Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable

[Knightshade]

It already passed Senate, unless this is a separate 1.9T bill.
So if it passes in Congress tomorrow, it gets rubber stamped by the President - this could be our news tomorrow?
Please correct me if I'm wrong...

Ok, you are wrong


From your link-

With the budget resolution nearly complete, Congress can turn in earnest to writing Biden’s expansive pandemic relief proposal into law — and push it through the Senate, without Republican votes if necessary, under the special rules unlocked by the budget legislation. That process will take weeks, with Democrats eyeing mid-March as the deadline for final passage of the relief legislation because that is when enhanced unemployment benefits will expire if Congress doesn’t act first.

The thing passed in your story is the budget bill that allows them to later pass a relief package via reconciliation.

It's not the actual package.

"A bill can be introduced in either chamber of Congress by a senator or representative who sponsors it."

It can- though all bills for raising revenue must start in the house.

(that said, courts tend to read that rule pretty narrowly.... and what the senate sometimes does is take some totally unrelated thing the house passed, gut it, and stick their own stuff in and pass THAT since it "originated" in the house)

Good example of that last thing here:
Continuing Appropriations Act, 2014 - Wikipedia

 

[capster]

Poppycock! I’ve been told repeatedly over the last couple weeks that there is a demand problem! If it’s not true am I required to sell my demand shares? Anyone? What’s the rules on that?

Considering that your "buy every time someone says ‘there’s a demand problem’" appears to one of the best investment strategies that’s been discussed on this forum, I’d say you should continue to hodl.

Besides some birds are bound to come around parroting "demand problem, demand problem, shorty want a share, squawk!" again soon and for the foreseeable future.

 

[22522]

In apparent response, US treasury rates are already being shoved downward by overseas markets. If that continues in US trading tomorrow, it could push upward the current discounted value of future earnings and hence current share prices for growth stocks like TSLA.

I don’t understand. There is an order of magnitude difference between Tesla growth and these minor interest rate changes.

 

[mekberg]

Besides some birds are bound to come around parroting "demand problem, demand problem, shorty want a share, squawk!" again soon and for the foreseeable future.

According to @SpaceCash birds aren’t real.

 

[UnknownSoldier]

This is uh one wild ride we're on. I guess the sole consolation is that these 8% swings we're seeing would have been 20% swings before S&P 500 inclusion, and in fact they were just last year.

 

[Mr X]

Trust

 

[Curt Renz]

I don’t understand. There is an order of magnitude difference between Tesla growth and these minor interest rate changes.

TSLA is valued on assumed great growth for many years to come. Small adjustments of the interest rate factor used to discount the value of the future earnings stream, can greatly affect the current share price. Recently the up move in interest rates may have been the primary reason for this month's drops in the share prices of TSLA and other growth stocks.

 

[SOULPEDL]

I looked... it's fine.

Ok, you are wrong


From your link-



The thing passed in your story is the budget bill that allows them to later pass a relief package via reconciliation.

It's not the actual package.







It can- though all bills for raising revenue must start in the house.

(that said, courts tend to read that rule pretty narrowly.... and what the senate sometimes does is take some totally unrelated thing the house passed, gut it, and stick their own stuff in and pass THAT since it "originated" in the house)

Good example of that last thing here:
Continuing Appropriations Act, 2014 - Wikipedia

Thanks buddy. I was catching up on youtube, looks like maybe another week to go for the Senate.

 

[Congo Line]

We have no tapering in FED purchases and a shot economy. And yet, bond yields spike over fears of not just inflation, but rampant runaway inflation.

What is pissing off the bond market is a commitment to throwing cash around via 1.9 trillion stimulus to jump start economy. The direct $1400.00 payments is definitely rubbing bonds the wrong way. That and the possibility of a minimum wage increase. Because everyone knows it is the little people that cause inflation.

My questions: how many trillions lost due to this COVID nonsense? How many tens of millions of people cannot pay their rent in US alone? And how does a 1.9 trillion stimulus bill make up for it to the point of destroying the financial system from too much money sloshing around?

This is obviously temporary one way or another as continued spiking yields would crush economies worldwide and reverse the process, but I guess the bond market is happier with deflation than even a hint of inflation.

Agree, the bond market seems to be acting irrationally, although it is often given credit for being more insightful than equities markets.

Although stimulus bill is viewed as inflationary, there is historically high level of unemployment which will take years to reverse, and this would seem to provide a lot of slack to be taken up before inflation kicks in. Also, Powell has committed to not tapering easing program until at least 2023, yet bond market models are pricing in for Fed to start tapering by end of this year.

The 10-year rate is now pretty close to what it was pre-pandemic, and IMHO the bond market is overreacting.

 

[mejojo]

Or as Happy Gilmore would say, "The price is wrong, b***h"

The SP....it's circular. Its like a carousel-- you pay the quarter, you get on the horse. It goes up and down and around. Circular... circle.

 

[asburgers]

10Y back over 1.5 with Asian markets puking. Lovely. I should take an extended nap tomorrow.

 

[MP3Mike]

No substantial profit was ever made by being comfortable with an investment.

Really? I am totally comfortable with my investment and I think it has returned substantial profit, and will continue to do so. (Now you might not be comfortable with my investment, but that is a whole different issue.)

 

[Cosmacelf]

Really? I am totally comfortable with my investment and I think it has returned substantial profit, and will continue to do so. (Now you might not be comfortable with my investment, but that is a whole different issue.)

Ignorance truly is bliss

 

[Nocturnal]

No, I was thinking it would be pretty reckless to borrow against Bitcoin to buy TSLA. In a black swan economic crisis it seems both would be likely to move in the same direction. I definitely don't buy the theory that Bitcoin is a safe haven.

I'm not that worried about a black swan economic crisis but it's not because I think one can't happen - it's that I'm confident the duration would be relatively short. However, I'm not leveraged at all right now. If I borrowed against Bitcoin to buy more TSLA a margin call could happen at the worst possible time. When the sugar hits the fan, the last thing you want is to have to sell at the bottom. That takes a bad situation and makes it worse.

These are the kind of things you want to position yourself such that they cannot happen. The observation that it's a low-probability event doesn't mitigate this because hope is not a valid investment strategy.

Black swan economic events are very rare but cannot be ruled out. And I guarantee in such an event all assets would be likely to be hit much more than 20%.

Just the same as taking margin in any other situation. But as I said the price would have to be low enough for me to take on that extra risk, which is unlikely.

 

[StealthP3D]

Air strikes normally a negative for the market? I've only been doing this for a few years.

When I was a young investor, I naturally assumed military aggression would be disastrous for the value of my shares. But the market kept surprising me. It seems markets like military action. Even if the initial reaction is negative, it almost always rallies hard in short order. Often it skips the initial negative reaction altogether.

I don't like it but it is what it is.

That said, I think the market response might be different if the aggression had a high likelihood of turning into something more substantial than, say, the war with Iraq.

 

[Richard007]

Found this article is last weekends financial times insightful on possible March madness

 

[StealthP3D]

Damnit guys. We need capitulation for the market to hit bottom! Everyone has to say, 'ok, that's enough, I can't take it anymore, I'm out.'

Instead, we have a bunch of diamond handed HODLers here. How is the SP supposed to reverse if all of us continue to buy and are running out of change under the cushions??

The most painful declines for an investor are the long, slow gradual ones. A little bit down for 6 or 8 days for every one or two days up. Month after month. A slow bleed. You don't want to sell any of your stocks because they are good companies and prices are too low to sell but they keep going lower, day after day. You get a small rally or two and think it's over but then they turn around and go lower yet.

I think the person who invented waterboarding was trying to design a torture worse than this. I've never been waterboarded so I'm not sure if they were successful or not.

 

[Matias]

I fear that crash is coming. I’m approximately 30% cash (about 50% in public stocks and 20% in not publicly traded).

Of course my guess is as good as anyone’s

I have made mental line where I will sell all public stocks (it is if my portfolio drops 10% from the current value). Of course it may lead to selling at the bottom.

But considering that at bear markets stocks drop 20-50% it may be wise.

A Brief History of Bear Markets

Of course it is only possible to know afterwards

8 people marked this funny. Funny how? You don’t believe there will be market crash? My opinion is that this is not nice conversation culture.

 

[Matias]

This would have led me to sell multiple times this month Heck...3 times just this week already.

It means your portfolio is not diversified enough..

 

[S3XY]

I looked... it's fine.

Thanks buddy. I was catching up on youtube, looks like maybe another week to go for the Senate.

I heard it's projected to be signed into law the second week of March which seems to fit your timing.