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by GuB-42 2141 days ago
I don't think that Tesla is a bubble, more like gambling.

Tesla right now clearly isn't worth $1T, but it is definitely on something big. Electric cars look well set to be the future, and so are the batteries that go with them. And currently, Tesla is a leader in both these fields. Furthermore, Tesla is creating an ecosystem not unlike Apple with its cars, it includes their supercharger network and all their software. And we all see how successful Apple is.

So yeah, huge potential. However, it is all speculation. Maybe traditional car manufacturers will wake up and offer decent electric cars. Maybe their ecosystem will fail to capture their market. If that happens, even if Tesla stays profitable, its value will crash. That's because Tesla will stop being a bet on the future and become just another mid-rank car manufacturer.

Personally, I am not into gambling, so I won't buy and I won't short.
1 comments
basch 2141 days ago
It is worth $1T in the sense that people have said "this team looks like the best team to give $1T to to build cars."

Sure, everyone is investing to make money and extract it later, but its also a bet that they will be a player for a while, are more efficient at using the cash then their competitors, can scale better. At the end of the day it is capital allocation, and the market has decided this team is the best team to handle the task. (Or it is a true bubble, where everybody doesnt want to miss out, but I think its some of the former too. Ford and GM are legacy businesses that have legacy overhead.)

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robjan 2141 days ago
$1TN is just the last price multiplied by the number of shares. The amount Tesla raised was just however much they earned from the original sale of stocks.
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basch 2141 days ago
Tesla can buy other companies with it's stock.

Facebook's stock is basically Mark's personal currency.

I understand that buying stock isn't straight up giving a company cash, but by pumping up its value, the shares the company is in control of are worth more. I also totally get how thinking people are this altruistic with investing is naive, and it's probably just fomo and short squeezes in a death spiral.

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