Unfortunately, on Wall St there’s job safety in crowds. Group think overdoses are very common. Most of the street was falling all over themselves trying to upgrade Tesla in February, now the avalanche of downgrades is here.
(2)
Tesla up near $700 pre-market, they did it again (see above). After the mountain of March downgrades, equity is up 100% from the recent lows.
(2)
*TESLA EXTENDS DECLINE AFTER MUSK SAYS STOCK ($760) PRICE TOO HIGH - Bloomberg
(2)
Tesla equity nears $900, here come the analyst upgrades...
Tesla $1010 today, close to 200% off the March lows. All the Bears have become Bulls, you know what that means...
(2)
Selling at the Highs, what a novel idea...
Morgan Stanley downgrades Tesla to Underweight, lowers price target to $650. Goldman to Neutral...
(2)
Tesla Deliveries with the stock at $1000:
Q2: 66k
Q1: 89k
Q4: 115k
*Q2 figure is based on Street analysts’ estimates, Tesla data.
At $1130 vs. Goldman's 12-month price target of $950
*downgraded to Neutral from Buy this month.
(2)
In early April, the Tesla, August $1200 strike calls traded at $5, last week at $36, and today $143, a 2600% return. Of course few would have held the trade that long, but it's remarkable how cheap upside was trading during the dark days of the sell-off.
Front-Run
S&P 500 inclusion needs > 3 consecutive quarters of profitability, thus TSLA has NEVER been in the index. With a total enterprise value now close to $300B, and Tesla reports on July 22., some are betting the people at S&P are eager to add.
By buying up Tesla now, speculators are forcing the S&P Indexes to give the stock a higher and higher weighting. Thus, ETFs / Indexes will be forced to pay up, buying even more shares. Then the hot money exits, leaving indexes holding the bag. Thoughts?
• • •
Missing some Tweet in this thread? You can try to
force a refresh
*File under things you will NOT hear on CNBC. Bloomberg terminal data.
Power Grid, Big Data Centers -- Did the street finally figure out that Nvidia $NVDA 's expected growth trend needs copper names up another 100% from here?
*Copper miners > QQQ since 2020, 2021, 2023, 2024
A decade ago, global copper production was 19.4mmt (million metric tons); today, it is near 23.7mmt, up 4.3mmt (22% growth). Now think of the decade ahead.
100 million robots
Rebuild the US power grid
900 new AI data centers
LA Rebuild
Ukraine Rebuild
Gaza Rebuild
Investment-Grade Bond Sales - pressure on prices below— the great crowd out. There are indeed AI (data center) bills to pay. After the META bond deal, last week's "drive-by" $30B surprise, now this:
*GOOGLE PARENT ALPHABET STARTS EIGHT-PART US DOLLAR BOND SALE - Bloomberg.
The weakness in investment-grade bonds, see the LQD move lower. It’s not credit weakness, it was a surprise supply crowd out. The colossal Meta bond deal on Thursday was of a surprise size. Weighed on the market, big time. They printed $30bln (purpose - AI capex funding).
The investment-grade bonds market was set up for a $120B in November supply, and then all of a sudden got $30bln by one issuer, as a drive-by (surprise overnight) on Thurs in advance. So then Friday. The IG market had to make more room for the coming supply, digestion issues.
Any asset class that is relentlessly promoted by strippers and charlatans, an “investment” that plunges 70% four times in a decade is NOT a store of value. Long term track records on crypto are meaningless garbage.
Over the last decade, Bitcoin has spent most of the time off 40 to 80% - see the red drawdowns below. You must be prepared for this price action. Personal capital must have a long-term view with a mission to add in to weaknesses. If you will need the $ inside the next 5 years, get out now.
The conundrum. The pump artist and strippers draw young people into this dangerous game at the highs. They need to find the greater fool to move the asset class further. Young people adopt a perceived long-term view: "I will never sell." Then, Bitcoin drops 70% and stays there.
Business Development Companies BDC’s Private Credit - the slime show is oozing to the surface. Borrower “First Brands” used a Lehman like Repo 105 move to hide leverage and screw investors. Two size frauds in the last 10 days, stay tuned!
First Brands was;
“selling inventory at quarter end with a promise to buy it back higher after to hide in an effort to show better cash flow and inventory mgmt and hide the fact that there was that much more debt"
"Larry, Lehman Repo 105 is alive and well. This time in private credit!” CIO NJ
The loss to “private credit’ investors could be as high as $40B. “First Brands” balance sheet looks like so many of the mortgage CDO structures from 2007-2008. They want to “hide the salami,” - hide the leverage to produce returns.
Someone MUST start calling out this BS, a sustainable, forward-looking power path???
USA Nuclear Fleet -- average reactor has a capacity of around 1 GW (97 GW total capacity from 94 reactors).
You need 10 reactors, each with a capacity of 1 GW, for Jensen's "one project."
Building a nuclear power plant in the US typically takes around 7 to 10 years, considering both planning and construction phases. Sure, the Trump DOE (Department of Energy) can cut this timeline down, but it's time to GET REAL. A must-read - "When Markets Speak" on this subject.
Small Modular Reactors (SMRs) are designed to be built faster than traditional nuclear power plants, with construction times ranging from 2 to 7 years, depending on the design and regulatory approvals. Once again, Jensons' $NVDA pump festival is plagued by numerous issues.
Over 15% of everyone’s 401k is crammed into two artificial intelligence focused stocks (Microsoft and Nvidia) without a sustainable plan for energy supply to support lofty growth assumptions.
“Never, ever invest in the present. You have to visualize the situation 18 months from now, and whatever that is, that’s where the price will be, not where it is today. If you invest in the present, you’re going to get run over.”
Stanley Druckenmiller
(2)
Jensen $NVDA (CEO) -- has done a great job of pumping up investors into the bull case, but he has an obligation to inform Nvidia shareholders on the risks to growth coming from energy bottlenecks in 2025-2028.