☕ What you’re NOT hearing about Tesla’s earnings

Good morning! 👋  

I’ve got a handful of meetings today, so I’ll keep it brief.  

Here’s my playbook. 

1 – What you are NOT hearing about Tesla’s earnings 

Investors are pitching a fit this morning because Tesla has warned about lower volumes and other business pressures in 2024. (Read) 

Cry me a river! 

Think about what's happening. 

Think about the jump in services and other gross profits. 

Think about the increase in energy storage deployment. 

Think about AI, insurance, energy trading, robotics and a dozen other startups that are already running inside the company. 

Thing about how Tesla will change the game again when it starts producing new, lower cost EVs starting in 2024 and early 2025. Why? See #5. 

And if all that doesn’t do it for ya’...  

Think about what Musk himself said, "I see a path where Tesla could be the most valuable company on the planet." 

I agree. 

Bought more shares this morning. 

2 – Apple on top in China 

Contrary to legions of people who couldn’t fathom Apple’s price cuts in China, I told you there was a method to the madness. 

Team Cook became the largest smartphone vendor by shipments in China for the first time last year. (Read) 

Demand remains high, especially amongst brand/status-conscious Chinese consumers. 

You know what to do. 

3 – GDP: you can’t make this stuff up 

The web was filled with reports this morning at 0330 about how economists expected a sharp decline in growth, a marked slowdown and all sorts of other hooey. 

Where the heck do these people find jobs, but, I digress. 

The US economy grew faster than expected while defying the naysayers yet again. 

That’s what you want to pay attention to and focus on. 

Keith’s Investing Tip: Like many official data sets, the GDP report is a) tremendously flawed and b) more cooked than a Christmas goose. That’s why you want to pay attention to the CEOs running the world’s best companies including names we talk about regularly. If the business case for owning those stocks remains intact, continue investing. This isn’t rocket science! 

4 - 44% of US adults can’t handle an unexpected $1,000 expense 

This doesn’t sit well with me for three reasons.  

First, the data gets more stark every single year which tells me that a huge swath of people living in this county are financially illiterate. The fabulous Suze Orman, host of the super-popular Women & Money podcast, estimates the figure is 95%.  

Second, despite knowing this, our school systems still don’t teach basic financial knowledge let alone functional financial life skills. I am reminded of this every time I see a line of young folks buying $10 designer coffees and older folks trying to catch up while grousing about how tight money is. 

And finally, 1/3rd of Bankrate survey respondents would borrow from a friend or put the bill on a credit card if they had to cover an unexpected expense. 

Is it any wonder that stocks like Affirm rose 190.51% over the past 12 months??!! 

The downside and why I won’t touch it is that I think the BNPL – buy now pay later – model significantly increases the risk of personal bankruptcy for millions of hardworking people who don’t know any better, a sentiment echoed in this well-written article from the NYT. 

MyPOV: There is a bright spot. The current state of financial fragility will result in a new ecosphere and the very concept of money will be reinvented within the next few years. I’ve already identified two key stocks ahead of the curve and am happy to own both. Neither, btw, does crypto in case you’re wondering. Hopefully, you’re thinking along similar lines. 

5 – Whoooop ... there it is ... Chinese EVs  

 I've been telling you for months that Unka Elon’s price cuts are not about margins like everybody thinks. Rather, they’re about Chinese EV makers which he views as the real competition a few years from now. (Read) 

Perhaps not surprisingly, I recommend two of ‘em because I think they’re blue chips in the making which is why patient investors could find both attractive. (Upgrade to Paid) 

Bottom Line  

You make your money in bear markets.  

You just don't see it until bull markets. 

As always, let’s MAKE it a great day – you got this! 

Keith 😊 

PS: We are making one final DNS shift this morning as part of the server upgrades we did over the holidays; please forgive me if your email gets a bit delayed! I am told that the Internet Spirits resolve these issues within 24 hours or sooner depending on how fast the servers propagate.