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Plus, here is some speculation on the Battery Day announcements on 22nd September, mentioning the Osborne Effect that may impact the stock price, something I have posted about previously in P&E in relation to the car industry as it transitions from ICE powered cars to EVs.
https://www.ccn.com/tesla-battery-day-bad-news-tsla-stock/
https://cleantechnica.com/2020/08/29/tesla-introduced-a-business-model-the-world-has-not-seen-before/
Tesla stock price may be madness but surely that makes Nikola's stock price insanity as they have not yet produced a single vehicle and have nothing but some words and a pile of investors cash?
https://www.cnbc.com/2020/09/08/general-motors-takes-11percent-stake-and-2-billion-in-equity-in-electric-truck-maker-nikola-.html
https://www.teslarati.com/tesla-roadrunner-battery-day-leak-analysis-video/
https://www.ft.com/content/bba4ffb5-69f2-4282-89a3-3de1827d8d4d
"Tesla’s planned shift to in-house production of electric vehicle batteries has caused investors to question the carmaker’s partnership with longtime supplier Panasonic. The Japanese group’s stock sank 4 per cent in Tokyo on the news. Dashed expectations of growth for the business with Tesla propelled the fallout. Tesla revealed on September 22 that it intended to produce 100 gigawatt-hours’ worth of battery cells by 2022, enough for 1.4m vehicles. The volume is roughly three times that which Tesla purchases from Panasonic today. “Supplies to Tesla’s new vehicles [from Panasonic] could potentially decline,” said Tang Jin, senior research officer at Mizuho Bank. The development comes as Panasonic’s business of producing batteries for Tesla makes its way towards profitability after years of red ink."
The pain of the enormous losses isn't getting any less for the February short sellers, it still doesn't look like Tesla is a sell. I expect the share price to continue a steady rise over the next few years with some volatility along the way as traders lock in profits periodically but my view remains that it's a buy and hold stock for the foreseeable until the competition catch up with Tesla's battery and software technology, and when they do Tesla will still be years ahead of them as they will have perfected cheap mass production of that technology.
$27BN losses with 58% less shares shorted as the short sellers cave in and buy themselves out of a hole.
https://thenextweb.com/hardfork/2020/10/30/tesla-stock-short-sellers-interest-intel-alibaba-apple-squeeze/
What do you do? sit out for 1 year? 2 years? 3 years? that's not going to help with building a retirement fund. How many years do you let go by waiting for that "I told you so" moment?
Jeremy Grantham has been forecasting doom and gloom since before 2017, he says returns have been inflated for the last 100 years. He'll get it right one of these years. he was probably skipping round his living room in March, albeit briefly.
Will the US stocks market crash 50% from current values again? yes, without a doubt, but should you sit on the sidelines letting years go by in fear of it? no.
If you want your retirement pot to continue to grow or at least keep up or almost keep up with drawdown past retirement date it needs to be invested, retirement date is only the point you stop paying earnings into it (save for any capital gains through inheritance), not the point it stops being invested.
most investors don't make money that way consistently, you are just following the indices more or less
I can't believe you just dismiss Grantham as if he knows nothing
https://en.wikipedia.org/wiki/Jeremy_Grantham
He is a self-made billionaire, and manages over £100b of investments
As for Grantham, I'm not dismissing him as such just not fearing his predictions, note that he says expected long term returns from US stocks may be lower due to high valuations now, he is not saying there will be no returns. It will all average out and revert to the mean over time and that mean will be steady growth over the long run. To reduce sector and location bubble risk but remain invested for long term growth then investing in the global index would be the best course.
Here's your favourite canadian on market timing, quoting data on market timing:
For the S+P
if you invested in 1929, your pension fund would go down 85%, and not recover until 1955, 26 years later
if you invested in 1937, your pension fund would go down 50%, and not recover until 1946, fair enough there was a war
if you invested in 2001, your pension fund would go down 45%, and not recover until 2007
it's not happened much recently, you need to research why that is in the USA
compare the FTSE and S+P charts
The US has pumped lots of cash into the markets effectively. This cannot carry on indefinitely
https://www.investopedia.com/ask/answers/021015/how-does-quantitative-easing-us-affect-stock-market.asp
https://www.investopedia.com/articles/investing/082515/how-do-asset-bubbles-cause-recessions.asp
read all that and tell me that you believe everyone should simply invest permanently, and passively