It never seems to end

People are retarded and it never ceases to annoy me. Nobody will care, but I have to get it off my chest. Last summer I came quite close to buying some NVIDIA puts. I’m glad I didn’t, because I would be trapped. You have a mature company here, trading at 29 times revenue. For a company like that, everything has to go right, for decades to come, for investors to ever see their money returned.

With Tesla it’s the same story. It’s a car company. It trades at eight times revenue. Revenue has been flat for the past four quarters. They’re no longer the largest EV company, BYD just passed them. BYD trades at one times revenue. The typical car company with flat revenue trades at less than its revenue. Here I had to go ahead and buy some put options, they’re expiring in January 2025, but so far they just lost value.

Tesla lied about its range, they’re the only ones whose cars consistently fail to meet their advertised range. Tesla models miss their range estimate by 26%. The autopilot was promised years ago. It was never delivered and people now have cars without radar, that will never have autopilot, because they don’t have the hardware.

People were promised robotaxis. It was “financially insane” to buy anything other than a Tesla, because next year your car would be able to drive itself and deliver passengers to its destination. That’s what Musk promised people, so they went out and bought this car, based on that promise. In a normal society, you get your money back when the company failed to deliver on its promise.

So in a normal society, Tesla is supposed to run at a loss for years to come, paying people back the money they spent on cars that don’t drive themselves and don’t achieve the range they were promised. And a car company that’s going to make a loss, is not supposed to trade at nine times revenue.

Right now, the company is being subpoenad. The US Justice department is criminally investigating the company run by the “richest man” on the planet. Because they lied and brought a product onto the market that was simply not ready for the roads. People have died because of the autopilot software, it doesn’t work.

This insane company has now released another new product, a “cybertruck” that’s not road legal in the EU, turns pedestrians into gore and gives you a whiplash if you crash into something. That’s their only new model, all their other models are outdated. Reuters reported that Tesla blamed drivers for failures of parts it knew were defective. They let people drive around on the highway at high speed, in cars with defective parts. The CEO himself declares the company “dug its own grave” with the cybertruck. But the stock doesn’t care.

If any of this happened to any other car company, it would have some sort of consequences. But it seems as long as there are hordes of low IQ low status white (and Korean) males willing to throw their life savings at Tesla, this swindle just continues. There’s not a chance this company could ever offer people a proper return on their investment at today’s price. If its earnings stayed the same (they have declined over four consecutive quarters), if you didn’t have to pay dividend taxes (you will), if it paid out all its earnings as dividends, you’d spend 76 years waiting to break even.

There are other examples. Coinbase is worth 36 billion dollar right now. This is a loss making company, trading at 13 times revenue. In what universe is a company like this ever going to make investors money? Over time, the dividend received from your investment is supposed to exceed what you paid to acquire the shares in a company. That’s never going to happen for a company like this.

I know this is boring, I know nobody cares. But markets are not supposed to work like this. Bitcoins are valued at 900 billion dollar right now. But a bitcoin doesn’t earn you any money. In fact, around 10 billion dollar is spent every year right now, on “mining” new bitcoins. Where is all this money coming from?

It’s normal to have insane periods, the ground beneath the Japanese palace was once worth more than all the real state of California. That’s the anecdote you always hear. But what normally happens, is that it then eventually ends.

Tesla, Bitcoin, Coinbase, Nvidia, these are insane bubbles. But rather than deflating, they crashed and now they’re back to where they were. “Oh Tesla is worth more than the top ten automakers combined” is supposed to be the sort of anecdote you tell years after the whole thing has crashed, but the crash never seems to come. It’s an enormous waste of money, which represents time and energy.

For the past ten years or so, we’ve lived in a universe where greed, incompetence, failure and lies are just continually rewarded, with this pattern becoming cartoonishly ridiculous in 2020. Elon Musk liquidates short-sellers by lying about having “funding secured” to take his company private, but gets away with it. In fact he doesn’t just get away with it, he becomes the wealthiest man on the planet.

It feels as if ever since 2020, I haven’t lived in the real world, but in some sort of bizarre extrapolation my own brain produces based on what it knew at the time. It all just genuinely doesn’t feel real. It feels like everything is some kind of joke at my expense.

30 Comments

  1. Musk is the last big hope isn’t he? Taking us to Mars? Something like that anyway.

    A bet on him is a bet on the future.

    If nobody bets on Musk, then we’re doomed to be stuck here on a finite rock with diminishing resources, and it’s all as good as over for the myth of progress and infinite wealth accumulation etc.

    So, perhaps the rich are betting on him succeeding, even if it is likely to be a losing proposition, to keep their dream alive?

    Whereas if they bet against him, won’t they lose irrespective of whether Musk succeeds or fails?

    • You want to escape our world, that is rapidly becoming a soulless, lifeless, rock; by traveling to other, soulless, lifeless, rocks. You want to rape the rest of the Universe like you’ve raped Earth, until everything has been consumed, everything dies, and the cycle begins anew.

      This is called retardation.

      • That may well be so, but the rich don’t seem to have any qualms about that.

        But for what it’s worth, I agree with you, it’s a bad idea, but that isn’t going to stop the rich from backing Musk.

    • Making money is obviously not be the whole reason for investing in Musk.

      Many of the rich ‘invest’ in things just to have something to brag about over a few rounds of golf.

      Just chump change to them.

  2. Just thought I’d add my two cents/satoshis on Bitcoin. I went pretty deep down the Bitcoin rabbit hole back in early 2021, around the time Tesla added thousands of coins to their balance sheet. Back then, I was very bullish/optimistic about bitcoin and life in general. But unfortunately, after learning about the vaccine catastrophe and the climate crisis, the optimism has sadly been largely replaced by pessimism. So I guess you could say that Bitcoin was my “autistic special interest” for a while. But now most of that interest has significantly faded. But anyway, my thoughts:

    “But a bitcoin doesn’t earn you any money.”

    For the Bitcoin Maximalists, Bitcoin IS money, which doesn’t require it to have any intrinsic value. All value is subjective, according to them. They view it as a superior version of gold, with all the desirable characteristics that made gold an excellent form of money. Scarcity, divisibility, portability, fungibility et cetera. A store of value, medium of exchange and unit of account. A way of transferring value across space and time. The most decentralised and secure computer network on the planet, which they argue makes Bitcoin unique and differentiates it from the 25,000+ other crypto currencies.

    Regarding the recent surge in price, there seems to be two main reasons:

    1) BlackRock spot ETF
    2) April 2024 halving is being “priced in” in advance

    Regarding the energy use, the Maximalists believe that proof of work is essential, and that proof of stake is inherently flawed. They rationalize the energy use in a number of ways:

    1) A significant percentage of the mining energy is derived from renewable sources
    2) Much of the fossil fuel derived mining energy* is “stranded energy” i.e. energy that otherwise would have gone to waste had it not been used to mine bitcoin

    So the Maxis believe that the environmental impact of bitcoin is negligible. They even claim that there are many environmental benefits of bitcoin mining, but I will not detail them here. Michael Saylor of MicroStrategy set up a company called the Bitcoin Mining Council which discusses this topic in depth. Again, this is not my opinion, I’m simply outlining the different arguments that I’ve read. It’s impossible for me to ascertain whether the Maxis are correct, or if the skeptics (like yourself) are correct. My I.Q./cognitive capacity is not at a level that is able to decipher the correct viewpoint. And honestly, I’m too burned out to put the time and effort in anymore in an attempt to determine the truth.

    Another unknown is whether quantum computers will be able to “break” the SHA-256 encryption. The Bitcoiners say there’s nothing to be concerned about because that would mean that the nuclear launch codes, stock exchanges, bank accounts etc. would also be compromised. But couldn’t it be possible that if TPTB had access to quantum computers, they could selectively deploy it against the Bitcoin network, and leave the other encrypted infrastructure alone, simply as a way of destroying confidence in Bitcoin? I just don’t know. I also don’t know why there’s so much animosity between Bitcoin Maxis and gold bugs, when they are both fighting the same enemy (central bankers).

    Anyway, enough rambling.

    * It’s worth noting that there was a time when much of the mining hash rate was derived from coal powered electricity plants in the Inner Mongolia province of northern China. Thankfully these eventually shut down and the miners moved to western China where there is abundant hydroelectric energy from river dams. But then the CCP shut these down, forcing the miners to go to Russia, Kazakhstan and Texas.

    • >intrinsic value
      This is an NPC term.

      >All value is subjective, according to them.
      If you disagree, I would challenge you to point to a real value.

      I’ll give you something simple. What is the value of a 500ml bottle of potable water?

      • Yes, Robert Breedlove has addressed the intrinsic value vs. subjective value debate in several of his podcasts, if I remember correctly. This is also something that the Austrian School economists tend to discuss a lot.

        And according to Max Keiser, Bitcoin is a better form of money than precious metals precisely because it has no intrinsic value. He argues that with gold and silver, the intrinsic/utility value (jewellery, industrial and medical applications) distorts the price discovery mechanism because it becomes difficult to determine what the monetary premium is for these metals. To illustrate this point, let’s compare gold and platinum. 950 platinum jewellery tends to be more expensive than 22 carat gold. But when we compare the current spot price of these metals, gold is over twice as expensive ($2031/oz. vs. $927/oz.) as platinum. Why? Because gold has a much higher monetary premium than platinum.

        So Max is basically arguing that bitcoin doesn’t suffer from this problem due to it having zero intrinsic value and 100% monetary premium. So by being valued purely subjectively, it can achieve true price discovery in a free market.

    • Chuckle.

      By way of a witty rejoinder: “This Is How All Civilizations End: In Denial, Followed by Panic”

      https://www.youtube.com/watch?v=fAHpWYx5AB4&t=571s

      I do like Sam Mitchell – he cracks me up.

      Sam also asks an interesting question that I hear more often these days, which is how to live a good life in the full knowledge that our civilization is doomed. Which also seems to fit into discussion today and from a few posts ago.

      I was going to bring up Sam a few posts back actually, because I could sort of see a parallel between Sam’s decision (which obviously didn’t last) to withdraw from the ‘doomosphere’ and stop making his YouTube videos because it was making him miserable and stopping him from being successful in his personal life, and our host Rintrah when he wrote:

      “At a subconscious level we hate them for it and want it to blow up in their faces. So the more you keep gazing at it, the more horrifying things you’re going to stumble upon (example: IgG4). I literally just don’t post about most of the stuff I’ve read lately and I try to stop myself from reading more about it. The darkness was never my choice, it was imposed on me. But I try to actively expel the darkness now.”

      Going back to Sam, here’s where he’s at now:

      “How can you move on with your life, and go shopping for curtains on Amazon.com, when a goddamn tornado is blowing outside your window?” But, he says with a shrug: “I’m getting better at it.”

      Chuckle – that’s the spirit Sam 🙂

      But then, I’m still in the same camp that I was a few days ago of punching through the grief to acceptance and then transformation, as opposed to avoidance and denial etc.
      That said, I’m a bit of a ‘realist’ and I’m pessimistic about our future. However, in light of what Rintrah wrote the other day, it’s interesting to me that the same point of view as mine is now being presented to me in videos and essays by some other doomers!

      Which, amusingly, seems to affirm the case Rintrah made about the tendency to find more of what you look for. . .

      I guess I have supporting evidence now for both positions 🙂

  3. Hi. Great article. I read a great article years ago that postulated that the US Government was preventing a long lasting market correction by stepping in and buying S&P futures as needed. I think the US Gov knows that the game is up if the stockmarket is allowed to decline significantly: wealth effect and loss of confidence in the $. Hence propping up selective mega caps through futures. Could be self-financing if you have the $$$ to drive prices.

  4. Re your last paragraph, we did enter some bizarro world in 2020 – the year that SUCKED.
    It started off with an estimated billion animals burning to death in Australia, and then we watched the “novel coronavirus” march towards us from China as people lost their minds and governments worldwide tightened the screws and imposed totalitarian measures that were previously unthinkable. It ended with Potato Joe allegedly ascending to the presidency.
    I still feel like I’m living in some kind of science fiction dystopia.

    • Yeah, those fires were something. Unbelievably huge, generating their own weather. . .

      An estimated three billion animals, up in smoke.

      Each evening, I watched this towering wall of thick smoke get blown in on the sea breeze from the pyrocumulus spewing crematorium to the East of me.

      Frightening.

      The whole country was on fire.

      Our then PM, a fool and coward, took off to Hawaii for a breath of fresh air.

      Incredible.

      A disaster so big there could be no denying it, and he took flight.

      And then, shortly after, came the virus. . .

      Total madness.

      “”Vaccine”” nazis everywhere. Lies, manipulation, propaganda. . .

      And that fleeting sense of unreality, like it was all balanced on a knife edge and could tip at any point into something completely new. . .

      Which would be welcome really.

      And no, that sense that it is fragile and could just come apart, or maybe just burn out and extinguish, hasn’t gone away.

      So much has seemed like BS to so many of us for years, but now, it feels like we’ve turned a page, and there’s no going back.

      And in truth, I’m not sure we should want to go back either, because it sucked, and we all knew and know that it was and is going nowhere good.

      Far better to face reality, then see what happens next.

      • Once you’ve grokked the universal wickedness that’s going on outside of your trailer, can you put it all out of your mind, and just go back to shopping for curtains on Amazon.com?

        No. I don’t think so. It’s too serious for that. Whatever you do next, you know you can’t get your ‘innocence’ back, you’ve been transformed.

  5. > It feels as if ever since 2020, I haven’t lived in the real world, but in some sort of bizarre extrapolation my own brain produces based on what it knew at the time. It all just genuinely doesn’t feel real. It feels like everything is some kind of joke at my expense.

    I’m still waiting for you to take me up on my offer to chat in more detail about these things, Radagast. Even just by email of whatever, it doesn’t matter. I have some stories and perspectives you might find interesting, but they won’t fit in this comment section. Worst case it’s something interesting to read, best case maybe we both figure a few things out about what’s going on.

    • Tryptie, give it up.

      Despite Radagast’s emanations of cynicism and pessimism, he’s a romantic at heart and won’t soon “go there”

        • > , I’m not talking about mutually reveling in cynicism

          I thought you had been talking about Nature/God being an abusive narcissist, and those who worship It suffering from a kind of Stockholm Syndrome.

  6. Rintrah, for some time I’ve noted with interest your playing the market to earn a living. Curious if you’ve watched this brief video (or read the PDF) at https://thegreattaking.com

    tl;dr — we’ve reached peak debt, monetary velocity has plummeted, and changes in US and European laws over the past 30 years or so mean that only the creditors at the very top of the financial system will own anything once the derivative market implodes and starts cascading insolvencies.

    What use are puts or calls if you can’t trust your counterparty? Interested in your thoughts.

    • If that happens, nothing I do is going to matter much.

      Honestly I don’t know how you want to prepare for a scenario like that.

  7. “It feels as if ever since 2020, I haven’t lived in the real world, but in some sort of bizarre extrapolation my own brain produces based on what it knew at the time. It all just genuinely doesn’t feel real. It feels like everything is some kind of joke at my expense.”

    You write a lot about karma. That’s karma.

  8. I think it’s more that the US has printed tremendous amounts of money since the ’08 financial collapse, and all of that money has led to absurd prices for real estate and stocks. Like you say, there are many companies on the market that don’t really deliver anything (or only a sliver) compared to what they’re worth, and yet they seem to keep going up and up. This is also true of housing: when you look at some of the stuff that goes on the market, they’re some of the weakest-made buildings you’ve ever seen, made out of the cheapest materials and techniques they could find, and yet they’re priced absurdly.

    The only way for this to reverse would be a long overdue crisis/recession. It would have to force the fed to raise interest rates and withdraw those trillions of fake dollars.

  9. What’s more likely – that the world works in an insane fashion, or that there’s a critical piece missing from your understanding of its workings?

    The markets are the last place on earth I know about where you can make essentially unlimited money, in short time frames, by disciplining yourself away from delusion and towards fanatical realism. If you can be right when everyone is wrong, you bank, but you can only reliably do that by disciplining yourself to see past the fog of bad intel and inaccurate mental models that dominate discussion of the field.

    If you listen to others, PE ratios and the actual health of a company’s daily operations are highly predictive of the stock’s performance in the next few years, but are they?

    Huge overbought companies that perform horribly can skyrocket indefinitely. Someone I know bet a third of his money on a small hemp oil company with an excellent product, very low PE, and many apparent structural advantages vs the other small hemp oil companies out there. Since 2019 this company has lost 95% of its value.

    Something is missing in your mental model of what moves stock prices. What is it?

    If you can see past the fog of misinformation and the frustration of having wasted hundreds of hours of thought on what turned out to be a failed explanatory model, you can get filthy rich.

      • You have a defense mechanism wherein you need to defeat others in discussion rather than see their point.

        Who cares about hemp honestly, my point is that your mental model of when and why “line go up” is BROKEN, thus you cannot make sense of the world around you.

        If you weren’t a reckless impulsive neurotic fag, you’d contemplate this and its ramifications for your financial future, and thank me for trying to help you figure this out.

        Unfortunately, to date very few of my attempts to help you help yourself have been met with anything but a young man’s mockery and derision, which is unfortunate as you are no longer young.

        • >Who cares about hemp honestly, my point is that your mental model of when and why “line go up” is BROKEN, thus you cannot make sense of the world around you.

          Alright fair.

          The problem is, there isn’t really an alternative to value investing.

          All investing is value investing.

          If you buy something because you expect its price will go up even though there is no prospect of earnings that would justify the price going up, you’re not investing, you’re speculating.

          That means sometimes you’ll win and sometimes you’ll lose.

          And sometimes you’ll prove to be really good at predicting the madness of the crowd.

          But more often than not, the madness of the crowd IS a bunch of people trying to speculate on the madness of the crowd.

          Which means you might as well go play poker.

          • No, there’s a million non speculative strategies and portfolio designs that are not value investing.

            One important distinction is, whether or not a given investor knows more or less than what a basic bitch retirement planner knows.

            If you do not think there is an alternative to value investing, that’d firmly put you in the “no” category, unless I’m misunderstanding you. That’d mean you have more study to do to get up to average, which would potentially answer some of your questions in the process.

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The patients in the mental ward have had their daily dose of xanax and calmed down it seems, so most of your comments should be automatically posted again. Try not to annoy me with your low IQ low status white male theories about the Nazi gas chambers being fake or CO2 being harmless plant food and we can all get along. Have fun!

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