Tesla Investor's General Macroeconomic / Market Discussion

[RobStark]

German Unemployment Rate is 3.7%
USA Unemployment Rate is 4.0%

Both are essentially at full employment with only the unemployable and those in transition left.

There are over 1M high paying jobs in the US that are wanting for skilled applicants.

 

[neroden]

There's no such thing as "jobs that are wanting for skilled applicants" -- there are only "companies not willing to pay to train unskilled applicants".

 

[Starno]

I think 2019 is going to be a fairly positive year for the market in general. There was this kind of massive correction at the end of 2018. It cleared a lot of overvaluations and overheating. The fed is more cautious, and might not even raise the interest rates at all this year. China-US trade talks are going well, with both parties wanting good relationships. And historically, during the 3rd year of a presidential term the market has been something like 87% of the time positive (YoY).

Europe might bring some issues, but I think the global situation is strong enough to withhold negative events. At least for the next 4-5 quarters.

 

[pz1975]

Tesla, Bitcoin, and the Inverted Yield Curve Herald a New Era of Growth

Good interview with Cathie Wood (CEO of Ark Investment Management). I posted this here because it starts with a discussion on the significance of the inverted yield curve. It also discusses Tesla and some of their other other stock picks. Worth a read.

 

[mblakele]

Naturally the latest issue of The Economist covers recent macro turmoil. Here's a sample:

 

[mblakele]

The case for a falling dollar
Why the dollar’s ascendancy is looking tired

[...] The dollar’s fortunes have not yet shifted decisively. But the conditions for it to weaken are starting to fall into place.

To understand why, consider the forces behind the dollar’s ascendancy since 2014. America’s economy, though sluggish by historical standards, has benefited from an ever-reliable engine: the American consumer. The euro-zone, by contrast, responded to its sovereign-debt crisis by saving more. Its surplus savings, together with those generated in Asia, must find a home. America’s high-yielding bonds and modish technology stocks have made it the go-to place for global savers.

[...]

Apart from such trouble spots as Argentina, Chile and Turkey, emerging-market currencies have started to rally against the dollar. Still, the euro is the gauge by which many people judge the dollar’s vigour, or lack of it. And it has been stubbornly weak.

[...]

​

 

[mblakele]

Recently I've noticed some folks looking for a place to discuss macros. So... probably time to bump this thread.

Seems like most media are blaming the current dip on coronavirus fears? Here's an article about how that might play out.

Covid-19 presents economic policymakers with a new sort of threat

 

[dmunjal]

Recently I've noticed some folks looking for a place to discuss macros. So... probably time to bump this thread.

Seems like most media are blaming the current dip on coronavirus fears? Here's an article about how that might play out.

Covid-19 presents economic policymakers with a new sort of threat

Corona could be the catalyst but if you follow gold and bonds, it's telling something more.

 

[AudubonB]

Corona could be the catalyst but if you follow gold and bonds, it's telling something more.

How so and in what way, @dmunjal? Is there a way you can extract from, say, gold's action as to what is the disease's effects versus other factors?

 

[dmunjal]

How so and in what way, @dmunjal? Is there a way you can extract from, say, gold's action as to what is the disease's effects versus other factors?

If the virus slows down GDP growth across the world which seems to already be happening, central banks will be forced to lower rates and expand their balance sheets. Emerging market currencies get hit first and money flows into the US dollar and US Treasuries. Gold is expecting more QE and bond traders are front running this.

 

[Cosmacelf]

If the virus slows down GDP growth across the world which seems to already be happening, central banks will be forced to lower rates and expand their balance sheets. Emerging market currencies get hit first and money flows into the US dollar and US Treasuries. Gold is expecting more QE and bond traders are front running this.

This would be good for the US stock market wouldn’t it?

 

[dmunjal]

This would be good for the US stock market wouldn’t it?

Yes, but only after the Fed responds.

 

[azaz]

There is a legitimate possibility of coronavirus being declared a pandemic this week and Sanders looks more likely than ever to win the nomination.

Combined, this week could be shaky and might be remembered as the top.

 

[Cosmacelf]

There is a legitimate possibility of coronavirus being declared a pandemic this week and Sanders looks more likely than ever to win the nomination.

Combined, this week could be shaky and might be remembered as the top.

I don’t disagree. So, are you going to sell your positions? I swear, selling is harder than buying...

 

[azaz]

Not selling any shares since my time frame for those is super long term but am thinking of buying some PUTs

 

[Cosmacelf]

Not selling any shares since my time frame for those is super long term but am thinking of buying some PUTs

Puts on the nasdaq or specific high beta stocks?

 

[TheTalkingMule]

There is a legitimate possibility of coronavirus being declared a pandemic this week and Sanders looks more likely than ever to win the nomination.

Combined, this week could be shaky and might be remembered as the top.

Why would a Sanders nomination lead to shakiness? Certainly an economy that's 75% consumer driven would benefit from consumers having more money at the expense of the investor class.

 

[DrMazeppa]

Looking for other perspectives on the next few weeks: on one side we have increasing issues due to the virus, a market asking for a correction; on the other we have central banks ready to print more money (which we know is pumping up stocks big time) and TSLA on fire.

Personally I have great expectations for Q1, and the last two days have shown incredible resilience in TSLA (though this could be an illusion to get to 900 calls), but if the broader market suffers, would Tesla become a safe place to move money from other stocks,or simply follow down the rest?

 

[Cosmacelf]

Why would a Sanders nomination lead to shakiness? Certainly an economy that's 75% consumer driven would benefit from consumers having more money at the expense of the investor class.

Because socialist policies wreck economies. Or, if you prefer, the investors who invest in the stock market think socialist policies wreck economies which will cause massive stock market selling. It's the same in the end. And no, I'm not going to get into an argument about economic policies.

The stock market will freak out if either Bernie or Warren get the nomination, calm down when polls show Trump will win, and have a modest bump when he does win. If any of the other Dems get the nod, the dynamics will be different.

From a market macro perspective, given the current state of the nomination, I suspect the market will be queasy this week looking ahead to South Carolina. If SC hands Bernie more than an expected number of delegates, look for a market correction the Monday after. But guessing what the market will do based on any particular event is fraught with huge error bars.

But it isn't looking great just from the coronavirus impact. At some point, US and world GDP projections will be revised again downwards...

 

[Cosmacelf]

Looking for other perspectives on the next few weeks: on one side we have increasing issues due to the virus, a market asking for a correction; on the other we have central banks ready to print more money (which we know is pumping up stocks big time) and TSLA on fire.

Personally I have great expectations for Q1, and the last two days have shown incredible resilience in TSLA (though this could be an illusion to get to 900 calls), but if the broader market suffers, would Tesla become a safe place to move money from other stocks,or simply follow down the rest?

Now this conversation should be in the other thread!

I would bet that TSLA follows all other high beta and growth stocks and goes down. Honestly, if you think macros are going to be negative, it wouldn't be the end of the world to pull out of the market entirely, sit on cash, and then go back in at the first sign of anything going well. And I'm not talking about just TSLA. Pulling that trigger seems hard, though, doesn't it?

The next shoe to drop for TSLA will be that Chinese consumers are not buying cars this quarter. Whether or not this directly impacts Tesla sales is irrelevant, the market perception will be negative. On the other hand, Tesla does sell direct, so maybe they'll benefit. I was surprised that TSLA didn't crash on Friday after this article came out:

Coronavirus nearly halts China car sales, down 92%