Elon Musk. Twitter. Babylon Bee.

[Ken]

There is a recent article at Fortune interviewing a longtime Tesla bear who says the stock will be down to $24.33 by the end of the year. It is currently at about $110. He specifically says the high valuation in the past was in the expectation of rapid sales growth, but actual new orders last quarter were only 250,000, which means the only reason Tesla had positive growth in 2022 was their backlog of orders. Apparently a lot of Teslas are also leased rather than bought. Which bodes for large numbers of used Teslas flooding the market soon.

I have been a Tesla sceptic for years so it doesn’t take much to convince me, but he makes a great argument. When the current Prius finally reaches the end of its productive life I will almost certainly replace it with an EV. Just probably not a Tesla.

[Josh]

2% monthly increase is 26% annual. That’s pretty bad.

And yes, we are in a recession by actual terms, even if the government decides to say we aren’t.

No, inflation is currently about 0.15% month-to-month which equates to 2% on an annual basis. That is what that chart above is showing.

Under what definition are we currently in a recession? There are help-wanted jobs everywhere around here in the $15-$20/hour range going unfilled in fast food, warehouse, retail, etc. Unemployment is at near record lows.

Ken,

Claiming that inflation is currently 2% is patently absurd.

The Treasury currently pays over 6% on ibonds.

[Ken]

2% monthly increase is 26% annual. That’s pretty bad.

And yes, we are in a recession by actual terms, even if the government decides to say we aren’t.

No, inflation is currently about 0.15% month-to-month which equates to 2% on an annual basis. That is what that chart above is showing.

Under what definition are we currently in a recession? There are help-wanted jobs everywhere around here in the $15-$20/hour range going unfilled in fast food, warehouse, retail, etc. Unemployment is at near record lows.

Ken,

Claiming that inflation is currently 2% is patently absurd.

The Treasury currently pays over 6% on ibonds.

That is because they are 6-12 months behind. I-bond rates are set on May-1 and Nov-1 of each year and are based on the subsequent 6-months CPI-U rate. Here is the actual inflation numbers used to calculate the i-Bonds rate direct from the Bureau of Labor and Statistics: https://www.bls.gov/news.release/pdf/cpi.pdf

As you can see, we had a big spike of inflation in the spring and summer when fuel prices skyrocketed. Now that energy prices have dropped, inflation has mostly eased since energy prices drive so many other costs. The current i-Bond rate is based on the average CPU-U from May-Oct of last year



The above monthly figures also account for the downward trending inflation line in the graph I cited further upstream. As you can see, the inflation rate has been trending downwards since June.

[Josh]

Ken, claiming the inflation rate is 2% is patently absurd. Try again.

[Ken]

Ken, claiming the inflation rate is 2% is patently absurd. Try again.

I linked you to the BLS site where those numbers are calculated. Go look it up yourself. The CPI-U rate for November 2022 was 0.1 percent as you can see on the graph above, which actually equates to an annual rate of 1.2%. That is the latest data (they haven't released the December numbers yet). They go into a great deal of detail about how those numbers are calculated.

Yes prices are higher today than they were a year ago. The relevant question for monthly inflation rate calculation is whether they are higher today than they were a month ago. Or whether the higher price today are the result of price increases that happened last spring and summer.

If you go to the BLS site I linked to above you will see that the inflation rate actually peaked this past June when gas prices peaked and has been steadily declining ever since. Whether you think that is absurd is up to you.

[Josh]

Ken, claiming the inflation rate is 2% is patently absurd. Try again.

I linked you to the BLS site where those numbers are calculated. Go look it up yourself. The CPI-U rate for November 2022 was 0.1 percent as you can see on the graph above, which actually equates to an annual rate of 1.2%. That is the latest data (they haven't released the December numbers yet).

Yes prices are higher today than they were a year ago. The relevant question for monthly inflation rate calculation is whether they are higher today than they were a month ago. Or whether the higher price today are the result of price increases that happened last spring and summer.

If you go to the BLS site I linked to above you will see that the inflation rate actually peaked this past June when gas prices peaked and has been steadily declining ever since. Whether you think that is absurd is up to you.

It is obvious that these sources of data are biased. It is also obvious that the inflation rate is not “2%”. It is telling that you are so eager to believe whatever you are told from “official sources”.

[Ken]

Ken, claiming the inflation rate is 2% is patently absurd. Try again.

I linked you to the BLS site where those numbers are calculated. Go look it up yourself. The CPI-U rate for November 2022 was 0.1 percent as you can see on the graph above, which actually equates to an annual rate of 1.2%. That is the latest data (they haven't released the December numbers yet).

Yes prices are higher today than they were a year ago. The relevant question for monthly inflation rate calculation is whether they are higher today than they were a month ago. Or whether the higher price today are the result of price increases that happened last spring and summer.

If you go to the BLS site I linked to above you will see that the inflation rate actually peaked this past June when gas prices peaked and has been steadily declining ever since. Whether you think that is absurd is up to you.

It is obvious that these sources of data are biased. It is also obvious that the inflation rate is not “2%”. It is telling that you are so eager to believe whatever you are told from “official sources”.

No, it is not obvious that they they are biased. If you have evidence that the BLS is falsifying data then feel free to share it. There are millions upon millions of people and financial institutions who depend on such numbers to direct hundreds of billions of dollars of investments and they will be very interested in your "discovery."

What seems more obvious is that reality doesn't conform to your pre-conceived notions and so you chose to reject reality rather than examine your pre-conceived notions.

This is all just about your absurd claim that we are currently the worst recession in your lifetime and that is reason why Tesla stock prices are dropping. Are you going to just keep endlessly doubling-down on that claim forever?

[Josh]

We are definitely in the worst bear market of my lifetime. I wasn’t alive in the 70s. You keep blathering on about Tesla but seem to ignore the rest of the American and global equities markets.

[Ken]

We are definitely in the worst bear market of my lifetime. I wasn’t alive in the 70s. You keep blathering on about Tesla but seem to ignore the rest of the American and global equities markets.

This is an Elon Musk thread so presumably Tesla talk is on topic.

Shifting the goal posts are we? Instead of the worst recession in your lifetime we are now in the worst bear market in your lifetime? We can examine this new assertion if you like. First, where are the markets at today? The S&P 500 (which is the best measure of the market because it is a weighted average of the 500 largest stocks) is currently down 19.26% from it's 52-week high. The actual definition of a bear market is when it is down more than 20% but that is neither here nor there. We were, indeed at that point back in October. Here you go, this is current as of this moment. The market is actually up today based on today's release of some good jobs data. By contrast, Tesla is down about 70% over the same exact period or about 3.5-times more than the broader market. So taking the broader market into account, Tesla is still doing horribly. Worse than bitcoin actually, which is only down 63% in the past year.



So how does our current market compare to previous bear markets? Luckily for you there is a lot of information out there. Here is one graph showing all the bear markets going back to 1956. What does it show us? Is 19.3% the worst bear market in your lifetime? You tell us. Were you alive back during the great recession in 2008 when the market was down 56.8%? What about during the dot.com crash in 2000 followed by the 9-11 crash in 2001 when the market was down 49.1%. Were you alive then? Or what about the "Black Monday" crash in 1987 when the market was down 33.5%?

So are we really in the worst bear market of your lifetime?

[Josh]

Ken, you seem ideologically committed to the idea that right now is the greatest economy ever, and no amount of evidence will change your mind.

But the icing on the cake is you insisting that there’s no inflation and that we aren’t in a bear market either.