The Real Story Behind Tesla's Crazy Rally

The Breakdown

Blockworks

Investing, Business

4.8 • 786 Ratings

🗓️ 14 July 2020

⏱️ 23 minutes

🔗️ Recording | iTunes | RSS

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Summary

Today on the Brief: Wall Street quarterly earnings season opens Investor flock to higher-yielding Chinese government bonds Bitcoin whales go down but other types of HODLers go up Our main conversation: What the hell is going on with $TSLA? Elon Musk is now richer than Warren Buffett. A year ago, Tesla wasn’t as valuable as Ford or GM. Now it’s more than 25% of the value of the auto market as a whole. In this episode, NLW looks at a set of possible explanations: Elon as a Golden God/the cult of personality Tesla as an innovative tech company Better-than-expected vehicle delivery The mother of all short squeezes Robinhood effect Mr. FEDerico Narrative Market Machine In the end, NLW argues that in a world where 1) the new retail base is willing to engage in narrative and meme warfare and 2) where the Federal Reserve distorts prices, the narrative market machine becomes more of a driver of prices than ever before.

Transcript

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0:00.0	If you assume that there is this force that makes it harder to understand quote-unquote
0:05.6	true value, then all of a sudden what are you left with?
0:09.4	You're left with the narrative.
0:10.9	You're left with the narrative machine.
0:12.9	In some ways, it becomes your only choice to bet on the narrative machine because it's
0:17.6	a fool's errand to try to properly value things in a world with this incredibly
0:22.4	distorting force.
0:24.7	Welcome back to the breakdown, an everyday analysis breaking down the most important
0:29.3	stories in Bitcoin, Crypto, and Beyond.
0:33.5	This episode is sponsored by BitStamp and Crypto.com.
0:37.7	The breakdown is produced and distributed by CoinDesk.
0:42.5	And now here's your host, NLW.
0:48.5	Welcome back to The Breakdown.
0:50.6	It is Monday, July 13th, and today we are talking about what all of Twitter is talking about,
0:56.9	at least that's what it feels like, which is Tesla and why this monster stock rally just
1:03.1	keeps going. First, though, let's do a really super quick version of the brief.
1:09.0	First up, we are entering earnings seasons. This is the week that Wall
1:13.7	Street starts providing guidance on earnings from quarter two. Well, at least some of Wall Street.
1:18.9	Others have said that because of the insanity of coronavirus, they won't actually be giving guidance,
1:24.6	which is obviously very out of the norm. Why it matters is that
1:28.7	basically everyone is expecting all of these earnings to be absolute trash, right? Quarter two
1:34.1	has been nearly universally written off as just a wash. And so in some ways, ironically,
	...

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