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☕️ Will today be the day?

Mar 11, 2025

Howdy! 👋

Could this finally be the day the markets turn around? Maybe, maybe not... for all the reasons I laid out to the OBA Family in yesterday’s update.

The tariff tantrums will continue… until they don’t.

Simple as that.

Meanwhile, the path forward isn’t a mystery from an investing standpoint. Heck knows we’ve talked about it enough.

History is very clear.

You don’t need a PhD in economics nor a direct line to Unka Powell, the President or any other elected officials.

You simply need a long term gameplan that gets you through the short-term chaos that trips up many folks despite their best intentions. One that moves you and your money forward under a wide range of market conditions – bull, bear, or something in between.

Mine is simple.

Concentrate on where the world is going, not where it’s been
Buy the best, ignore the rest™
Use the right tactics to control risk

Oh, and one more related thought while we’re at it.

Every great rally starts when most people least expect it! 🤔

Here’s my playbook.

1 – Tesla’s moment or something else?

Source: Cern Basher, @CernBasher on X

Tesla experienced its 7th worst trading day yesterday, seeing a decline of 15.4%.

Not surprising considering how polarizing CEO Elon Musk has become.

Like him or hate him, that’s not the point – I don’t have the luxury of taking sides in my capacity as an investment strategist.

My colleague and friend, Dan Ives, notes, that, [we’ve] “Been here before many times with Tesla ... this is the start of the biggest innovation and technology cycle in Tesla's history ahead over the next few years. The launching of unsupervised FSD in Austin, Texas this June kicks off the autonomous era at Tesla that [Wedbush values] at $1 trillion alone on a sum-of-the-parts valuation. Autonomous will be the biggest transformation to the auto industry in modern day history and in our view Tesla will own the autonomous market in the US and globally." (Read)
Morgan Stanley’s Adam Jonas says, “Telsa shares can “rally more than 90%” and says buy shares on the dip. (Read)
TD Cowen upgraded the stock recently noting that shares can rally more than 45%.

On the other side of the coin.

UBS and Guggenheim both reiterated sell recommendations due to weak deliveries, concerns over demand, worries about Elon Musk's distractions and more.

Who’s “right?”

“Wrong” question.

Focus on who’ll be profitable… like, for example, billionaire Ron Baron who said late last year that he sees Tesla reaching a $5T market cap in 10 years and $30T long term. I think the number is probably $20T but that’s beside the point.

Many people can’t get past Musk when it comes to Tesla and there is absolutely nothing wrong with that. In fact, I think it’s great if you’re one of ‘em and equally great if you’re not.

This isn’t unusual.

Many investors, for example, won’t touch Amazon because of Jeff Bezos, yet the stock has been a long-term wealth builder. I can’t stand Meta because of Zuckerberg but am increasingly coming to terms with it. Some avoid oil companies on principle, but those who’ve held ExxonMobil or Chevron have seen massive returns. Others refuse to buy Nvidia at a high valuation, ignoring its dominant position in AI. Firearms, weapons, booze… same thing.

The market doesn’t care how you feel.

It only cares whether you understand where the money is going. The pie is plenty big enough for everyone who wants a seat at the table.

Keith’s Investing Tip: Social media has made it easier than ever to base your life on “likes” or what others think. Successful investors know that they will encounter plenty of companies they don’t like over time; stock ownership has nothing to do with “fandom” – it’s about financial opportunity. If that means buying more, great. If not, also great. Just make sure your choices are driven by strategy, not sentiment.

2 – Southwest Airlines new bag policy a “Hail Mary”

Southwest Airlines will start charging for checked bags on May 28, 2025—unless, of course, you’re in their top-tier fare class. (Read)

Translation - pay up or shut up.

I’ve logged more than my fair share of miles in the air and have intentionally avoided Southwest more times than I can count for a variety of reasons… cramped seats, a cattle call boarding process and the budget flight with all the charm of a Greyhound bus at 35,000 feet. But that’s just me and beside the point.

Southwest built its brand on being the no-frills, budget-friendly airline where “Bags Fly Free.” But apparently, that playbook - and marketing slogan - is out the window. And if you think this is some sort of genius financial pivot, I encourage you to think again.

Airlines are notoriously poor investments because they’re capital-intensive, unpredictable, and constantly one economic hiccup away from a government bailout. More to the point, they’ve got very low return to scale which handicaps ‘em in an increasingly digital world.

Southwest’s stock has lost investors -30.24% over the past five years. That means if you’d sunk $1,000 into Southwest five years ago, you’d be sitting on $697.60 today. Had you put $1,000 into Nvidia – a real “Zero to 1” company - you’d be looking at $17,424.30 instead.

Putskies… $15… if it doesn’t pull an “Intel” meanwhile.

3 – Nissan changes leaders faster than oil filters

Nissan is yet another storied Japanese brand on hard times.

Along with other executives, CEO Makoto Uchida will step down on April 1, 2025, and will be replaced by Chief Planning Officer Ivan Espinosa. (Read)

This is Nissan’s fourth CEO in eight years and comes after poor financial performance, failed merger talks and other issues deep in the company.

This hurts because it’s a brand I’ve been fond of for years… decades actually.

The problem with many modern Japanese executives is that the very traits that made ‘em unparalleled power players in the 80s are killing what’s left of Japan’s once vaunted corporate machine.

I made the comment several years ago when then Chairman Carlos Ghosn was unceremoniously ousted that we were potentially looking at the end of Nissan as we knew it.

Sadly, it increasingly appears that I was on to something.

Nissan stock (NSANY) has returned –69.79% since 2018. The SPY, a popular S&P 500 ETF, and even iShares Nikkei 225, an all-Japanese ETF, have returned 132.57% and 85.32% by comparison, according to Koyfin.

4 – Got $13,700? Buy your own humanoid robot

The inner geek in me is seriously tempted.

You can now buy your very own humanoid robot—the EngineAI PM01—for just $13,700.

Naturally, it's from China.

And yes, before you light up my inbox, I get it.

This thing is probably packed to the brim with sensors and silicon, beaming your deepest secrets straight to Beijing’s intel apparatus. But hey, at least you’ll be running on Intel N97 and Nvidia Jetson Orin Dual Chips while doing it.

Jokes aside, the era of robotics isn’t just coming—it’s here.

We’re no longer talking about clunky warehouse bots or Roombas that double as cat taxis.

We’re on the edge of mainstream humanoid robots—the kind that can walk, talk, and probably shame you into cleaning your house better, too.

The price point? That’s the real kicker.

Just a few years ago, getting anything remotely humanoid-like meant either deep pockets or a DARPA contract. Now, you can get a bipedal, AI-powered assistant for less than a decent used Honda.

I’ve been following this for quite some time now from an investment perspective and there are literally dozens of companies to choose from when it comes to staking your claim. Examples include Tesla, Figure, Agility Robotics, and 1X Technologies are racing toward mass production and you know what’ll happen next.

The question in my mind isn’t if you’ll own a robot.

It’s when—and what it’ll be doing.

Yardwork, while you sleep? Cooking before you get home? Mixing a cocktail while you enjoy sitting in front of the fireplace?

Part of me is terrified but another part of me is increasingly looking forward to what happens next.

Invest accordingly.

If you’ve got this covered and have a firm grasp on where to put your money, that’s fantastic. If you’d like a little help upping your game, I’ll be here.

5 – Meta’s new AI training chip

Meta is reportedly testing its first in-house chip which is intended to train artificial intelligence systems. (Read)

The media is only passingly interested but this is a BIG deal.

Meta isn’t the only one working on custom silicon and certainly not the only company that will ramp up production in the next few years. Apple, Tesla and Amazon are also “all in” according to various reports.

At the risk of sounding like a broken record, any investor who isn’t buying into AI-related stocks because “they’re down” is kidding themselves. Or, at least it seems that way to me.