2020 = Year of the Electric Car (*maybe)

Thursday, January 2, 2020 by Robinhood Snacks | Disclosures

"Anyone got an extra car cord I can borrow?"

Dow Jones
28,538 (-0.37%)
S&P 500
3,231 (+0.29%)
8,973 (+0.30%)
$7,169 (-0.12%)
10-Yr US Treasury

Hey Snackers,

Our 2019 resolution was to make financial news digestible.

We slept on it... and we're going with the same thing for 2020. You can help:

  • Forward this email to a friend so they can sign up at snacks.robinhood.com to enjoy the daily newsletter with their morning oatmeal ritual.
  • Add some flavor to your brutal commute with our 15 minute Snacks Daily podcast on Apple or Spotify.
  • Follow us @RobinhoodSnacks on Instagram or Twitter (FYI, we're giving away free Snacks tees right now).
1. Is 2020 the Year of the Electric Car? Tesla, VW, and Ford say yes (Honda disagrees)

Turn me on with your electric wheel... Mother Earth isn't a fan of burning gas — So is 2020 the year we switch to something else? The verdict is: a (strong) maybe. Carmakers spent the final week of 2019 humblebragging their future-focused electrification accomplishments.

  • Ford announced it's sold out of pre-orders for the first electric car it's actually serious about: Mustang Mach-E (this ain't no "compliance car").
  • Tesla just delivered its first 15 models produced in China, capping an insane under 1 year start-to-finish construction of its car-pumping Shanghai Gigafactory.
  • VW can't contain its e-citement, so it's accelerated its goal to produce 1M fully electric cars by 2023 instead of 2025.

Honda isn't convinced... The Boston Red Sox to Toyota's Yankees, Honda's experience with electric goes back to '99 (remember that salamander-looking Insight?). So its CEO is qualified to say he's "not sure" the world wants full-electric cars yet. Instead, Honda's focused on improving fuel efficiency with ybrid tech and won't go full electric "anytime soon."


Electric's 2 biggest issues = Price + Battery... If you haven't bought an electric car, it's probably because they're too expensive or you're nervous about running out of juice mid-ride (aka "range anxiety"). Carmakers know that — here are some ways they're trying to fix it:

  • Price problem: Analysts think e-cars won't be price-competitive until 2024-ish when battery prices fall more. Meantime, Tesla's China plant can produce cheaper, and tariff-free, for Chinese buyers.
  • Battery problem: Ford's Mach-E boasts a 300-mile option that 80% of pre-orders include. And VW is building a nationwide charging network so you can plug in mid-bathroom pitstop.

New New Year's Resolution... Stop using a sketchy international scheme with a charming name to sneak out of US taxes. Instead of going to the gym more, Google's parent company Alphabet will end its "Double Irish, Dutch Sandwich" tax minimization strategy in 2020 — they saved billions and only paid a single-digit tax rate on money earned outside the US through this structure loophole.

It sounds like a bar order, and reads like a Spring Break itinerary... but it's actually a perfectly legal travel route for money that won't trigger US income taxes or Europe's witholding taxes — and those happen to be most of Google's profits abroad. Here's how the cash moves:

  • The $$$ earned abroad is funneled to an Irish subsidiary ➡️ then moved to a Dutch holding company ➡️ then sent to an Irish shell company in Bermuda
  • That Bermuda part is key because the island has no corporate income tax — So that's where Google reports the income earned internationally.
  • $25B of Google's money made this voyage last year, up from $23B in 2017.

Tax policy can move economies... It isn't just that the corporate tax rate for US companies has been cut from 35% to 21%. The Tax Cuts and Jobs Act of 2017 now lets American companies bring back cash they made/hoarded abroad without paying additional US taxes. Now Google can bring back its billions in overseas cash to potentially invest in the US — or return to shareholders as dividends.

What else we’re Snackin’
  • NRD: It's "National Returns Day" — and UPS expects to ship back 1.9M gifts for it
  • Served: Uber and Postmates sue California over the gig-rights worker law, calling it unconstitutional (the law thinks your Uber driver earned full-tme worker status)
  • Designed: Amazon's HQ2 in Virginia will break ground soon — the outside looks brutally boring, but the parks around it are bask-worthy
  • Heard: China's Tencent Holdings leads a crew to acquire 10% of Universal Music, the music label behind The Beatles and Lady Gaga
  • Investigate: A US auto safety agency will probe a fatal Tesla crash that may have been tied to the autopilot function
  • Upcoming: Walmart's CEO thinks "virtual changing rooms" are coming before the end of this new decade
Snacks Daily Podcast

We're dishing out Snack-tastic shirts for just 4 more days @RobinhoodSnacks on Twitter and Insta


Disclosure: Authors of this Snacks own shares of Google, Uber, Amazon, and Tesla

ID: 1046827

Subscribe to Robinhood Snacks

Our Editorial Principles
Robinhood Financial LLC and Robinhood Crypto, LLC are wholly-owned subsidiaries of Robinhood Markets, Inc. Equities and options are offered to self-directed customers by Robinhood Financial. Robinhood Financial is a member of the Financial Industry Regulatory Authority (FINRA) and the Securities Investor Protection Corporation (SIPC), which protects securities customers of its members up to $500,000 (including $250,000 for claims for cash). Explanatory brochure available upon request or at www.sipc.org. Cryptocurrency trading is offered through an account with Robinhood Crypto. Robinhood Crypto is not a member of FINRA or SIPC. Cryptocurrencies are not stocks and your cryptocurrency investments are not protected by either FDIC or SIPC insurance.

Getting “early access” to options or Web is defined as signing up with a valid email address for a spot in Robinhood Financial’s respective waitlist queues for Web or for options. Getting “early access” to Robinhood Crypto is defined as signing up with a valid email address for a spot in Robinhood Crypto’s waitlist queue. Early access to the waitlist for Web, options, or Robinhood Crypto should in no way be construed as confirmation that a brokerage account with Robinhood Financial has been opened or will even be approved for opening. Priority may be given to Robinhood Gold subscribers and existing customers of Robinhood Financial.

Free trading of stocks and options refers to $0 commissions for Robinhood Financial self-directed individual cash or margin brokerage accounts that trade U.S. listed securities via mobile devices or Web. Relevant SEC & FINRA fees may apply. Please see the Fee Schedule.

Robinhood Financial is currently registered in the following jurisdictions. This is not an offer, solicitation of an offer, or advice to buy or sell securities, or open a brokerage account in any jurisdiction where Robinhood Financial is not registered. Additional information about your broker can be found by clicking here.

Margin trading involves interest charges and risks, including the potential to lose more than deposited or the need to deposit additional collateral in a falling market. Before using margin, customers must determine whether this type of trading strategy is right for them given their specific investment objectives, experience, risk tolerance, and financial situation. For more information please see Robinhood Financial’s Margin Disclosure Statement, Margin Agreement and FINRA Investor Information. These disclosures contain information on Robinhood Financial’s lending policies, interest charges, and the risks associated with margin accounts.

Investors should consider the investment objectives and unique risk profile of Exchange Traded Funds (ETFs) carefully before investing. ETFs are subject to risks similar to those of other diversified portfolios. Leveraged and Inverse ETFs may not be suitable for all investors and may increase exposure to volatility through the use of leverage, short sales of securities, derivatives and other complex investment strategies.

Although ETFs are designed to provide investment results that generally correspond to the performance of their respective underlying indices, they may not be able to exactly replicate the performance of the indices because of expenses and other factors. A prospectus contains this and other information about the ETF and should be read carefully before investing. Customers should obtain prospectuses from issuers and/or their third party agents who distribute and make prospectuses available for review. ETFs are required to distribute portfolio gains to shareholders at year end. These gains may be generated by portfolio rebalancing or the need to meet diversification requirements. ETF trading will also generate tax consequences. Additional regulatory guidance on Exchange Traded Products can be found by clicking here.

Options transactions may involve a high degree of risk. Please review the options disclosure document entitled the Characteristics and Risks of Standardized Options available through https://about.robinhood.com/legal or https://www.theocc.com to learn more about the risks associated with options trading.

The cash management program is expected to be offered by Robinhood Financial LLC. The cash management program, when operational, will be an added program to Robinhood brokerage accounts and will not be a separate account or a bank account. Robinhood Financial will provide additional information on the cash management program once it is operational to help customers, including those with “early access,” to determine if they want to add the program to their brokerage account.

Robinhood Snacks newsletters and podcasts reflect the opinions of only the authors who are associated persons of Robinhood Financial LLC and do not reflect the views of Robinhood Markets, Inc. or any of its subsidiaries or affiliates. They are meant for informational purposes only, are not intended to serve as a recommendation to buy or sell any security in a self-directed Robinhood account or any other account, and are not an offer or sale of a security. They are also not research reports and are not intended to serve as the basis for any investment decision. Any third-party information provided therein does not reflect the views of Robinhood Markets, Inc., Robinhood Financial LLC, or any of their subsidiaries or affiliates. All investments involve risk and the past performance of a security or financial product does not guarantee future results or returns. Keep in mind that while diversification may help spread risk, it does not assure a profit or protect against loss. There is always the potential of losing money when you invest in securities or other financial products. Investors should consider their investment objectives and risks carefully before investing. The price of a given security may increase or decrease based on market conditions and customers may lose money, including their original investment. Robinhood Financial LLC, member FINRA/SIPC.

Testimonials may not be representative of the experience of other customers and are not guarantees of future performance or success. Robinhood Financial LLC, member FINRA/SIPC.

Third party information provided for product features, communications, and communications emanating from social media communities, market prices, data and other information available through Robinhood Markets, Inc., Robinhood Financial LLC or Robinhood Crypto, LLC are meant for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any financial instrument or cryptocurrency or as an official confirmation of any transaction. The information provided is not warranted as to completeness or accuracy and is subject to change without notice. Any information about Robinhood Crypto on any Robinhood website (including www.robinhood.com and blog.robinhood.com), the Robinhood platform, e-mails, or any other communications, are meant for informational purposes only and are not intended as an offer, solicitation, or advertisement for Robinhood Crypto or any goods or services offered by Robinhood Crypto. The Robinhood website provides its users links to social media sites and email. The linked social media and email messages are pre-populated. However, these messages can be deleted or edited by users, who are under no obligation to send any pre-populated messages. Any comments or statements made herein do not reflect the views of Robinhood Markets Inc., Robinhood Financial LLC, Robinhood Crypto, LLC, or any of their subsidiaries or affiliates.

Investors should be aware that system response, execution price, speed, liquidity, market data, and account access times are affected by many factors, including market volatility, size and type of order, market conditions, system performance, and other factors.

All investments involve risk and the past performance of a security, or financial product does not guarantee future results or returns. Keep in mind that while diversification may help spread risk it does not assure a profit, or protect against loss, in a down market. There is always the potential of losing money when you invest in securities, or other financial products. Investors should consider their investment objectives and risks carefully before investing.

Cryptocurrency is a digital representation of value that functions as a medium of exchange, a unit of account, or a store of value, but it does not have legal tender status. Cryptocurrencies are sometimes exchanged for U.S. dollars or other currencies around the world, but they are not currently backed nor supported by any government or central bank. Their value is completely derived by market forces of supply and demand, and they are more volatile than traditional currencies. Trading in cryptocurrencies comes with significant risks, including volatile market price swings or flash crashes, market manipulation, and cybersecurity risks. In addition, cryptocurrency markets and exchanges are not regulated with the same controls or customer protections available in equity, option, futures, or foreign exchange investing. Cryptocurrency trading requires knowledge of cryptocurrency markets. In attempting to profit through cryptocurrency trading, you must compete with traders worldwide. You should have appropriate knowledge and experience before engaging in substantial cryptocurrency trading. Cryptocurrency trading may not generally be appropriate, particularly with funds drawn from retirement savings, student loans, mortgages, emergency funds, or funds set aside for other purposes. Cryptocurrency trading can lead to large and immediate financial losses. Under certain market conditions, you may find it difficult or impossible to liquidate a position quickly at a reasonable price. This can occur, for example, when the market for a particular cryptocurrency suddenly drops, or if trading is halted due to recent news events, unusual trading activity, or changes in the underlying cryptocurrency system. Several federal agencies have also published advisory documents surrounding the risks of virtual currency. For more information see, the CFPB’s Consumer Advisory, the CFTC’s Customer Advisory, the SEC’s Investor Alert, and FINRA’s Investor Alert.

Robinhood Crypto, LLC has a seller of payment instruments license in Georgia, with reference number 61417.

Robinhood Crypto, LLC has a money transmitter license in New Jersey, with reference number 1803456-C22.

Please note that an Alaska money transmission license does not cover the transmission of virtual currency.

Check the background of Robinhood Financial LLC and Robinhood Securities, LLC on FINRA’s BrokerCheck.

Robinhood Terms & Conditions    Disclosure Library    Contact Us    FAQ

© 2020 Robinhood. All rights reserved.