A Rocket Scientist, A Car Manufacturer and A Bitcoin Investor walk into a bar and the Barman says, “Just one pint of lager, Elon?”.
Tesla has become both a household name and a subject of great controversy over the last 18 months. A mixture of its 800% growth, its terrible earnings history and its famous CEO has led the conversation towards whether or not Tesla, and/or EV technology is a bubble.
The company was founded in 2003, but the most important stage in its development came 2 years later in 2005. This was when the internet phenomenon of “memes” became a mainstream form of media. Elon Musk has become a master of the meme and uses it as his main form of free advertising.
Everything about Elon Musk is a meme. He released “short shorts” on the Tesla website to celebrate how much money, “short investors” had lost when betting against his EV company. He sold thousands of flamethrowers labelled “Not a flamethrower” and he famously chipped 30% off Tesla’s market cap by smoking marijuana on Joe Rogan’s podcast.
That being said, Tesla has gone from being a relatively small car manufacturer to being worth more than all other car companies combined and has done so in less than 12 months. How? Well, perhaps it’s a function of speculative markets, massive monetary stimulus and the prospect of it being the Next Big Thing.
Tesla sold 500,000 cars last year. It recently announced that 150,000 of them have to be recalled due to various faults. What did the share price do on announcement? It increased by 3%.
Tesla’s dream is to clean up the planet and reduce global carbon output through the use of electronic vehicles. So, it would probably come as a surprise that they have just bought $1.5 billion dollars’ worth of Bitcoin.
Bitcoin has to be mined using exceedingly powerful computers. These computers use huge amounts of electricity, the majority of which is produced using very carbon inefficient methods. All in, Bitcoin has a carbon footprint equal to New Zealand. How very eco-friendly…
Elon fuelled the GME fire two weeks ago by tweeting things like “GAMESTONKS!!!”. Stonks, is the memeification (if that’s even a word) of the term “stocks”. It began with the implication of uneducated investing and gambling with company share prices in an attempt to make a quick buck.
One thing is very clear about Elon. He has an army of fans who are ready to put their money where his mouth is.
Daniel Frampton DipPFS