Tesla to $24.33 & Epic Recession | Confronting Gordon Johnson

welcome back to another episode of the

meet Kevin show from two days ago in New

York City with Kevin O'Leary to

yesterday with Gary black today we are

visiting who could potentially be the

most famous bear on CNBC and Twitter I

think it is going to be so enlightening

to have a discussion with you and uh I

am so excited to introduce Gordon

Johnson you have a research firm g l j

research and uh tell the world why are

you such a bear yeah thanks thanks for

coming uh it's a pleasure to meet you

um so essentially we're bearish right

now we're not structural Bears I hate

that we got that that moniker but

unfortunately that's what we have the

reason why we're bearish right now is

because we can get into this and we talk

about some of the other topics but you

know we've had essentially since 2009

we've had

um you know over a decade of

artificially low interest rates

um and we've had significant since covid

and even before covid quantitative

easing and we believe those macro

factors are shifting and we believe they

have to shift because what's happened is

inflation has now surged to a 40-year

high so the FED is kind of against their

back is against the wall and they have

to act to fight inflation because as

Charlie Munger said outside of nuclear

war inflation is the worst thing that

can happen so I think that the FED has

to act to fight that and I think that's

going to pull liquidity out of the

market I think that's going to be bad

for stocks that's the kind of overall

view why we're a bit more negative which

makes sense which is also why it looks

like uh you hit on Nick T this morning

that's the famous sort of fed mouthpiece

uh he seems to get the text messages

from Jerome Powell hey leak this or

whatever drone Powell seems to be really

interested in these moving averages of

what inflation is doing and Nick T this

morning mentioned that on a 12-month

annualized basis while 12 month year

over year we're at 4.6 inflation which I

know you have some comments on because

you tweeted it but what I did think was

interesting to your point is that

six-month annualized we're at four two

but three month where at four nine which

feels like we're seeing some

acceleration especially in that more

sticky travel Hospitality people

basically spending money on restaurants

right is is this going to become

unsustainable and is the Fed even able

or equipped to fight that kind of

inflation they're definitely equipped to

fight it and this is a great question

great setup

um so with respect to Nick T he does

great work I told him that I think the

issue is he's using seasonally a

seasonally adjusted index to make

observations on annualized numbers and

if you talk to the Bureau of Labor

Statistics they'll tell you you have to

use non-seasonally adjusted numbers

because you don't want those adjustments

and when you look at the non-seasonally

adjusted numbers specifically the index

not non-seasonally adjusted CPI over the

past roughly three months you've seen

literally it shoot up and in fact

inflation shoot up and in fact in 2021

if you look at the trend from about 1980

to 2020 it was a straight Trend and

there's a couple of periods 2000 2001

2007 and 2008 where kind of hockey stick

them in the moment right we went back

down sure it's hockey sticking again

that started in 2021 and I think again

the issue is all the stimulus money that

was printed so the problem is for uh the

deflation crowd is we're seeing a

Resurgence in inflation

um and in fact it's really resonating in

Services inflation which represents

about 70 70 of CPI Services inflation

when this in the CPI number uh was 7.1

percent in the most recent reading it

was down from 7.3 percent but I think

over the past uh roughly uh four

readings it's been above 77 we haven't

seen that since 1983. Services is the

sticky inflation that's really hard to

get under control so when you consider

that you consider that gas prices are

going back up right

um Energy prices are going back up what

happens with inflation is as we learned

in the 70s it rotates you know you see

it in Services you see it in uh car

prices then it rotates the energy then

it rotates somewhere else and when you

let that Genie out of the bottle as the

FED did I think you know know people say

the fed's going to make a mistake they

already made a mistake right the mistake

is 40-year high inflation right so when

you let that Genie out of the bottle

it's really hard to put back into the

bottle and you know I'm really concerned

and and again Nick does good work Nick T

um but he's using seasonally adjusted

numbers when he should be using

non-seasonally adjusted numbers when you

look at the NSA numbers the inflation

looks actually worse yeah that's

interesting because otherwise you're

comparing how seasonal adjustments have

changed so now then the question becomes

the you know we have all this mixed data

I mean diesel prices are plummeting

because of the freight recession but

gasoline prices are rising like you

mentioned it almost feels like what

you've described is this cancer of

inflation that it's here now it's gone

from there oh but now it's popping up

over here right it's like metastasizing

and showing up in different parts of the

body but my concern is with Services as

you've mentioned isn't there this

potential that the FED raises rates but

the people who are actually really

driving the services spending the

average American they don't necessarily

care about higher rates now maybe

that'll affect affect your credit cards

but if you're already in credit card

debt and you're already paying twenty

percent on your credit card who cares if

it's now 25 that really doesn't

marginally affect your ability to spend

or go on vacation because people are

living paycheck to paycheck yeah good

point so let's use history right yeah we

it's hard to predict the future in fact

it's impossible but our job is to try

you you're not sure so the issue is

every single time historically that CPI

inflation has gone above five percent it

didn't come back down again without

until not every session but until the

fed's funds rate went above CPI

inflation sure CPI inflation right now

is sitting at five percent right core

CPI inflation 5.6 the fat funds rate is

about 4 4.75 Powell had that prank call

yesterday and he said he's going to

raise rates two more times so

theoretically we're going to get to 5.25

but the problem is you don't just need

the FED funds rate historically using

history to go to where CPI is you needed

to go above CPI we're not there yet so I

think that his historically when the FED

raises rates it has allowed inflation to

come back down and let's be honest

really what the FED needs is they need a

recession um and that's not that's not

they don't want to admit that they and

he said that in the prank call yesterday

but they need growth to actually decline

they need jobs to be lost so you don't

have all this strength strong economic

growth I want to go to my notes Here

sure you know uh consumer spending so

consumer spending data came out recently

um it accounts for 70 of GDP uh 1q23

um it's surged by 3.7 percent that was

the biggest increase since 2021 during

the stimulus money bench um and then you

had government spending uh uh which

surged 4.7 that's a new record high so

consumers are spending like drunken

Sailors yeah despite the inflation we're

seeing and that is very bad data if

you're the FED um and if you're somebody

who is trying to fight this inflation

you know trying to make it by a normal

person you know we a lot of us talk

about the stock market but the

statistics suggests roughly 80 percent

of Americans are agnostic to what stocks

are doing right exactly so the problem

is the people who run things the people

who make decisions are so focused on the

stock market whereas the bulk of

Americans aren't I think that's why I

keep going back to this but I think it's

a great quote by Charlie Munger the only

thing worse than nuclear war is um

inflation and I think the reason is

because once that inflation gets to a

certain level we can look at you know

periods in history like the weirmware

Republic you know the collapse of Rome

the collapse of Greece all inflation

driven yeah um you know you start

basically people can't afford food and

they start to um you know uh basically

push back and when that happens you have

the fall of Empire so that's why we're

so focused on this topic on Twitter and

why we're so focused on it in our

analysis yeah now what's interesting is

the this consumer spend explosion seems

to be driven by you had mentioned

consumer spend for the first quarter up

3.7 seems to be driven by what last year

was a decline in people's personal

savings they were starting to go through

the excess savings they accrued during

the pandemic which gave them around

maybe on average two and a half times as

much cash as they previously had but

that had started declining in 2022

but now in q1 it started Rising again

right so this this idea that oh

eventually people are going to run out

of money

what when does that actually happening

great Point great point so I think

there's a dynamic happening and I don't

think a lot of people thought about this

think about this right so for the past

since Obama right the FED has been

artificially repressing interest rates

right I think a lot of people will agree

that they kept rates too low for too

long so think about this you know you

put your money at Chase and they're

giving you point

five percent on your money right you buy

a 10-year bond the 10-year bond was

yielding less than one percent for a

long time now all of a sudden you're

getting four percent on your savings

right every American not not just the

rich um you know you you buy a 10-year

bond

um you're getting five percent uh or now

it's 3.5 but not sure it was up to four

but you buy a one year bond you

understand it's way higher now the point

is there's a new source of income for

everyone that they haven't had for a

decade and that is interest rates being

higher higher rates are bad for people

like you and me who are investing in the

stock who are long stocks

but I know it's great for the average

American because now you actually get

paid on your savings so I think the

reason why you're seeing this strong

consumer spending is because interest

rates have went up to the point where

people feel more wealthy the problem is

again the FED needs to take interest

rates above CPI inflation so they're

they're fighting it but they're not

fighting it enough and as a result

people are outspending more I think

that's why banks have been strong so

that potentially could explain why we're

starting at least in these latest U of M

surveys on inflation expectations right

it seems like some of those expectations

are starting to rise we used to be at a

one-year expectation of around three six

two weeks ago and it just came out this

morning too I think it was four is above

four six so two weeks ago we were at

four six and it was a shocker that's the

preliminary read the final just came out

23 minutes ago and four six yeah so it

reiterates this this potential de

anchoring of inflation expectations

which suggests the FED has a lot more to

do right how high

um I I don't know but I think that you

know if I want to talk about this the

FED can we can we talk about this

absolutely just real quick so

look this may this may incense a lot of

people but I think this is the most

Reckless fed we've ever seen oh wow let

me explain so over the first 100 Years

of the U.S Federal Reserve Bank in the

United States their balance sheet grew

by roughly 1 billion I'm sorry one

trillion dollars it was about 974

billion that's that's the first 100

years right so when covid hit

initially their response was a two

trillion dollar monetary stimulus and

you know what we were looking at a black

hole right so I understand what they

were doing

but then when covet hit and we did 2

trillion six months into covet retail

sales were 15 above Trend yeah when the

growth when we had the global financial

crisis it took retail sales I think

eight years to get back to Trent yeah

um uh the the the the uh the 2001

collapse I think it took 12 years to get

back to Trent covid that recession it

took only six months and we fit 15 above

trade in addition we had vaccine

confirmation so after we were back to 15

above retail sales Trend and we had

vaccine confirmation they continued to

stimulate they did another two trillion

dollars that's 200 years of stimulus

they did in like two months that is

completely Reckless right and then they

said you know we're not going to

forecast when they were doing all the

stimulus and then as me and a lot of

other you know people who were

historians of the market were saying we

got the crazy inflation right and what's

crazy is they were essentially making a

like 30 to one bet on this right they

were trying to get so inflation you had

CPI inflation at 1.7 percent right they

were just trying to get to two percent

and to do that they were doing this

crazy stimulus now the problem is if

they lost on that bet it wasn't them who

lost right it's poor people it's I think

the stock market for the next 10 years I

think is going to be stagnated so wow my

point is these guys have proven to be

Reckless and be wrong with the

transitory comments Etc but then with

svb and I want to talk about yeah

hopefully we can get it to the bank

crisis but with SBB right you had a a

bank doing very bad things

um clearly other Banks had you know in

2022 had you know uh adjusted their uh

you know risk assets and duration to

match what the FED Fed was hinting they

were going to raise rates so you know

and and instead of letting them fail the

FED comes in in over two weeks that's

400 billion dollars of not QE we think

it's QE but so you know that's like you

know that's like 50 you know what was

that like 50 years of balance sheet

expansion in two weeks so you know this

isn't a an instance of you know courage

from Jerome Powell so I'm concerned and

we could talk about gold because I'm

concerned that when things get tough

he's not going to have

um the courage to stay the course on

fighting inflation and that could be

quite concerning oh wow I mean this is a

lot to unpack there I'm really really

insightful because you're right rates we

were printing over this last decade

before covid because as you said

inflation was running below Trend we

were at one seven uh and they were

trying to get us to two percent there

was even talk about lowering the

inflation Target which sounds insane

today but lowering the two percent

Target to 1.75 because they just

couldn't get it up right which makes the

question then that comes from that is is

that because of this 40-year

disinflationary trend of technology or

why did we see why were we able to print

so much money then and not see inflation

right uh and then of course we can talk

about the mistake of now that is a great

question I'm sorry I keep saying that

yeah so

the issue is there were two types of

inflation right you have inflation of

the monetary type and you have inflation

of the fiscal type right so with Obama

and through you know essentially until

we got to covid really what you had was

monetary inflation and that's the FED

essentially doing quantitative easing

right we we we did the you know the the

MBS bailouts we were supposed to bail

out the the housing market then they

just continued to do it so you say we

didn't see inflation but you did the

problem is you saw it in stocks and

homes house prices right that cancer

analogy somewhere else not to be

insensitive obviously you saw it in

stocks and houses right home prices have

went from I think an average of like 200

000 to like 400 000 now they're coming

back down but you know over that same

time frame minimum wage hasn't moved so

you've essentially priced an entire

generation you look very young you're

probably in that generation even you

price an entire generation out of the

ability to buy homes normal people right

the bulk of America it's not not the the

well-off

um so with covid right Congress got into

the mix and the Fed was extremely

Reckless they were doing all this

stimulus but Jerome Powell urged

Congress to join in sure so and keep in

mind right the U.S government can't do

stimulus without the FED printing so

people are blaming the US government and

they should but they can't do it unless

power prints that money out of thin air

so what you had is you had the fiscal

stimulus right you had literally uh

helicopter money being dropped with

people checks and so that's when you had

the inflation and everything else right

you just give people checks they're

going to go out and buy so that's when

you had the outside of homes and stocks

you started to see inflation everywhere

else and again once you let that Genie

out the bottle we've seen historically

it's extremely hard to put back in the

bottle so that's why I say and we can

talk about this more this is the most

Reckless fed we've ever seen wow I mean

that's fascinating because really you're

suggesting we've always had this

inflation during the QE regimes it's

just shown up in asset prices rather

than in nominal inflation for your

groceries or normal Services whereas now

we've had this massive acceleration in

in money printing during the covet era

which I I agree with you I mean looking

back if we had the vaccines approved

what five days after the election or so

November 9th of 2020 right around there

7th 9th

um why did we print until March of 2022

right when inflation was already six or

seven percent we were screaming

um via Twitter and however we could we

don't have the exposure you do that we

can't believe what the FED is doing and

you know people say well you're just

trying to support your short position I

care about America sure the issue is if

you look at any major crash of whether

it's it's an Empire or major crash in

the US economy it follows a bubble and

the FED has built via unnecessary you

know measures the biggest bubble in

essentially everything people have

referred to it as the everything buggle

bubble we've ever seen and you know what

a lot of bulls would say well what's

different right they've been doing this

since you know 2009 what's different

here's what's different right again I

think the people say the fed's gonna

blow something up I think they already

did blow something up and that is prices

40 year high inflation so the problem is

they've blown this bubble and you know

the fed's core goal is to keep prices

steady right that's essentially why the

Fed was created it's not even really

jobs the Fed was created central banks

were created to keep prices steady

clearly prices aren't steady so the

problem is they've blown these massive

Bubbles and now that we have 40-year

high inflation they have to fight it and

so as those bubbles Burst when bubbles

burst you have you know essentially

recession slash depressions and that's

kind of why I think people should be

concerned less scared yeah you refer a

few times now to almost comparing

America to potentially the Weimar

Republic or Empires collapsing is it

going to be that bad I hope not

um I don't think we're too far past uh

the pill but it really concerns me

um that what the FED did with svb doing

the 400 billion dollars of balance sheet

growth in two weeks uh because that

showed a lack of Courage

um a lack of willingness to fight

inflation

um so the concern I have is when the

going gets tough and the stock market

drops two percent I'm joking but yeah

you know you understand when anything

happens negative and I want to talk

about svb because those guys should have

been let to fill as in the depositors

would have been fine but when anything

bad happens I'm concerned this fed's

going to come in and do um you know just

massive stimulus again and that that

could lead to an even bigger collapse

later let's talk about that let's talk

about the banking crisis on stimulus

because I have to say I was uh really um

I found this picture very exciting that

you put on uh Twitter okay this uh this

right here your caption is uh in

medieval Spain Bankers who became

bankrupt were publicly disgraced by Town

authorities and given nothing nothing

but bread and water to eat until the

creditors were paid off right after a

year if the bankers fail to pay them

they would be beheaded and their

property and assets would be sold off

yeah I don't want to say I think Bankers

should be beheaded but I do think that

you know if you're able to make a lot of

money a lot of money doing bad things

you should also be able to be allowed to

fail let me let me talk about

essentially what happened um do you mind

if everything

um so so essentially what you had with

the failure of svb Signature Bank Credit

Suisse and any others it's the fault of

the FED for doing 14 years of interest

rate repression quantitative easing and

essentially turning the Banker's brains

into mush

um and what I mean by that is and you

also had Bank management for not taking

the fed's advice and preparing for

higher rates instead operating

recklessly in order to get you know

higher bonuses moving their stock prices

higher versus Brazil and Mexico by the

way who hiked rates sharply in December

2021. the Fed was telling you we're

about to start hiking rates what did

Brazil and Mexico do they hiked rates

significantly to prepare for that

um in December 2021 or the right thing

to do so you had svb signature your bank

credit Suites and others and who engaged

in stock pumping schemes to boost their

Equity prices which resulted in very

nefarious and likely illegal activities

keep in mind the at svb what they were

doing is offering below market rate

loans to startups who weren't making any

money right no earnings and the quid pro

quo was those startups had to keep their

cash at svb that's a bad business

practice right that's just that's just

nefarious business activity so when when

you when you get caught out there with

you you know when the tide goes out we

see who has a who's not wearing shorts

that's a Warren Buffett quote Yeah right

the tide went out they should have been

allowed to fail and keep in mind you

know everybody was talking about oh my

God the depositors these and we found

out later right it was like you know

guys who had billions of dollars so

these weren't you know small businesses

but also keep in mind

um that you know these depositors you

know would have been made whole right

the depositors that that next it

happened over the weekend that Monday

they would have been made whole 90 90

cents on the dollar right so this idea

that all these you know know small

businesses were going to lose money was

always wrong and when you when you bail

these guys out right when you allow

these guys to engage in nefarious and um

alleged credibly alleged illegal

activity

um you basically encourage moral hazard

so when you do that you essentially

encourage other Banks to do the same

thing so I think what Yellen did and

what what Powell did

um I think was bad and I think you know

it's all funded by the taxpayers you

know FDIC treasury et cetera the

government is funded by the taxpayers so

that's why I put that quote up because

you're not holding these people to

account and these people did extremely

very various things and we have we have

we have examples of banks who took the

fed's advice and raised rates you know

they they they change the duration of

their asset mismatch not just not just

Mexico and Brazil but also banks in the

U.S JP Morgan Bank of America et cetera

when these Banks didn't and and so these

Banks should be held to account I think

this is so fascinating because really

what you've suggested is that uh Jerome

Powell was weak in 2020 when we had the

vaccines we had retail sales above Trend

we had already won why continue to spend

money and now he's acting tough oh we're

going to stay higher for longer but as

soon as one thing goes wrong that's it

100 bailout of the banks essentially

right which was taxpayer backed uh

ultimately I think FDIC will end up

Distributing the 20 billion 22 billion

dollars of loss to other Banks right

really corporate socialism to some

extent which I think you've referred to

as well on Twitter so the question then

is if he was weak in 2020 if he's weak

now during the banking crisis

it sounds like you're thinking it's

going to be weak again and we're going

to see printing again and stimulus again

which potentially means inflation again

can you speak to that yeah so I I think

you you phrased it perfectly which is

why you know again everybody positions

us as bears but if you don't have faith

in your own power you don't have faith

in Joe Biden from a fiscal

responsibility perspective and they're

going to basically print which is going

to decrease the value of the dollar what

you want to do is you want to own gold

right if the dollar Falls in value gold

is going to increase not just gold but

other precious metals and potentially

other Commodities so that's why we're

bullish gold we own gold we like gold

um and I think it's because you have a

Fed chair and a U.S president who are

willing to spend hundreds of billions of

dollars in the face of 40-year higher

inflation which is extremely scary if

you love this country because again you

know every it's it's like every time I

talk about inflation these these guys on

Twitter who say you're just you know

talking up your Tesla position no study

economic history I went to school you

know I studied economic history um you

know I major in finance minor in

economics Morehouse College

um you know if you study economic

history inflation is extremely scary I

think Munger at over 90 years old he

knows what he's talking about

so do you think we're going to return to

stimulus checks then or how is that

inflation going to come back where's

this where's the weakness going to

manifest like how are we going to see it

right it's it's hard because if you look

at the history of inflation you know the

last time we had inflation like this was

in the 70s and what you've seen with CPI

it's like this right so you'll think you

got it under control then it rears its

ugly head you think you got it under

control it rears its ugly head and you

know everybody credits Paul volcker

rightfully so uh but if you remember

initially you know he didn't raise rates

enough at inflation 1980 and then you

had to come up again and then he had you

know at one point you had mortgage rates

at 15 you were able to invest in a bond

and get like you know 13

um so I don't know where we're headed

but I think that what is being done now

is not enough and I think that again you

know because rates were zero for so long

and now they're you know on certain

bonds you know one year you know six

month Bond you have near five percent

rates I think that's why you're seeing

an increase in spending because people

have more money on their savings and

they feel like they have our money and

they do but I don't think they're doing

enough and you can see that evidence by

the strong economic activity the strong

leg of Labor Market the CPI data today

the data we talk about the non-season

adjusted data which is now spiking back

higher

um so I I don't know what we need to do

but it's definitely more than what

they're doing and you know they have not

been a um a a a image of Courage if you

will

um uh with respect to some of these

issues we've had do you think the

depositor should have taken that 10

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absolutely absolutely I mean they would

have gotten that that day and then they

would have been made whole later

um but we now know that I think I think

it was like 10 depositors that had

billions of dollars so initially you

know like Circle was one of them I think

they had three billion dollars but the

point is it wasn't small you know

businesses that you know we're going to

see massive labor Cuts these were like

Silicon Valley billionaires who had you

know who essentially bailed out and

these were guys who knew what they were

doing like when you when you look at

some of these VCS on Twitter who talked

about some of the deals they got from

svb I mean it's crazy you know they were

getting below Market rates they were

getting like you know sweetheart deals

on mortgages Etc these are guys who not

who should not be bailed out and all of

a sudden it's the VCS and potentially

like the Gavin newsoms of the world who

were also a big voice in forcing this

essential backstop right right potential

conflict of interest it was just it's

it's infuriating when you think about it

if you understand what's going on I

think it's fascinating that you uh are

you you criticized Paul volcker

generally people don't go there uh

people seem to honor Paul volcker but

you mentioned that I mean he got in at

79 he had a recession in 80 because they

didn't raise rates even enough right and

that didn't tame the inflation that they

needed to raise rates again for starting

I think in October of 80. all the way

through 82 right to actually get

inflation under control so everybody

holds them up on a pedestal but even he

was not certain with what to do well no

I do hold him on a pedestal he he

he did something amazing he and keep in

mind at the time I think Carter was

behind him but there were a lot of

pundits out there and Congress both the

house and the Senate and you know TV

pundits Etc who positioned him as the

devil when he held his ground he is a

man to be revered he had the courage the

courage he had the courage so no I I I

just what I meant to say is initially he

didn't do it but he did it and he stuck

with it and he's a man that should be

revered because I think he saved America

from years of stress and if you look at

what this fed has done I mean think

about let me finish that thought if you

look what this fed has done it's the

opposite that think about this right

think about this think about it so Janet

Yellen right so in 2000 in 2021 2020

2021 right when the 10-year bond was

below one percent instead of issuing

debt to fund the U.S she was running

down the TGA now the problem is when you

run down the TGA not the problem the

benefit is if you're long stocks that's

like QE yeah um what we look at a lot of

people talk about the FED balance sheet

but you also have to look at the

treasury general account balance and the

reverse repo account balance when she

run down run down to TGA that's a way to

effectively stimulate the economy

you know the problem is she could have

issued that 10-year debt at below one

percent that was just Reckless it was

Reckless not to issue debt at those

numbers was Reckless enough it was

Reckless and you know so so so the last

time she ran down the TGA and then she

had to run it back up it was um I think

it was December 2021 to May of 2022

right she ran down to TGA she had to

refill it now keep in mind when she

refills the TGA what that means is she

has to issue debt into the market so

she's pulling liquidity out of the

market guess what happened December 2021

to May of 2022 s p down 17 and a half

percent right so now we're at a point

where right the TGA got all the way

below 100 billion right tax season we're

now at I think we're like 270 billion

she's doing about 50 billion of rundown

a week so that means she has about maybe

four or five weeks left before she runs

out of money so over the next month

she's gonna run out of money the debt

ceiling is going to be compromised and

then she's going to have to refill the

TGA right treasury general account

balance she's going to pull liquidity

out of the market where at the same time

the FED is doing QE last time she did

that s p fell 17 18 right right uh

correct yeah they're doing QT games

sorry correct sorry uh the FED is doing

quantitative tightening not quite but

the last time she did that right

the Fed was doing QE right the Fed was

you know pushing money to the market

stock market still fell 17.5 now she's

gonna have to do it and the fed's doing

QT right they're pulling money out of

the market so I don't know how much the

Market's going to fall but it's things

like this that I think some of our sell

side peers aren't focused on yeah and I

understand it but you have to be focused

on the macro in this environment oh yeah

absolutely yeah I think that's so

interesting the idea of refinancing or

having refinanced the debt lower reminds

me of I believe it was Donald Trump who

was saying we should take out 100 year

treasury bonds now because we could do

it for next to nothing right I mean now

in hindsight that would have looked like

a brilliant idea right he wasn't all bad

I don't want to get political at all but

um one thing I would say though is he

was pushing Powell to cut rates and I

think it was 2019 pal cut rates three

times with unemployment at a 50-year low

that was a huge mistake

um you don't do that when things are

going well you do that when things are

going bad so again another issue another

instance of him not having the courage

to do what's necessary the the right

Futures market right now seems to be

convinced that we're going to get around

two percentage points of cuts by

December January after maybe hitting

that peak of that 5.25 do you think

that's realistic or are we going to sit

at that flat line for a year yeah I

wanted to bet you a beer that's not

going to happen

I'm joking but no no absolutely a Bud

Light or like a like a Stella I don't

want to go there but

um what I'll say is you know you just

look at where inflation is you look at

the trends in inflation going up you

look at the strength in the jobs Market

you look at the strength in consumer

spending that we talked about the idea

that the FED is going to cut rates I

think is ludicrous

um and I think the rate Market will have

to adjust accordingly what Val said when

with the prank from zelinsk the faith

zielinski which we now know was real he

said we're going to raise rates two more

times and keep them there for a long

time look believe what he's saying like

I was a guy who fought pal right don't

fight the FED I fought him for a year

and I lost tremendously um look at Tesla

in 2020

um in 2021 I I fought them and I lost so

for guys who are saying we're gonna have

rate Cuts you're fighting what he's

telling you and I I don't think that's

smart I think you should believe what

he's saying and if you believe what he's

saying you know rates are going higher

is it possible and they're going to stay

there that the reason maybe people are

fighting that is the idea that the FED

can't today say that they're going to

cut rates in December because then

people will pull out dead and go right

back to spending and they'll reanimate

inflation and we truly won't get there

whereas if he pretends to have this hard

face uh we're gonna you know hire for

longer hire for longer and then we get

to December all right we're gonna you

know is is it an expectations game is he

playing with us because you actually

tweeted about how Jerome Powell seems to

be more transparent in this prankster

call right than he is with the American

people is he playing us I don't think

he's playing us I think but in the

prankster call he said what he's told us

right he said we're going to raise rates

he said in one minute what takes

probably 20 press conferences I agree I

agree I think they should stop with

these speeches but he but he kept with

what he's been telling us right he's

saying I'm going to raise rates and keep

them there he said that in the prankster

call so I don't think he's trying to

play us I think he's being honest and

let me tell you why so it's the data if

you look at Services inflation you know

uh Services inflation sitting at um hold

on let me see here so we got uh uh let's

see um core Services inflation right the

number that just came out core Services

inflation without Energy Services jumped

7.1 percent from a year ago in the most

recent reading um that's CPI okay the

core Services CPI I um and that was 7.3

in February so this was the fourth month

in a row of seven percent plus core

Services inflation it's the highest

we've seen since 1982. that has to be

scary to the fed you look at um Energy

prices which are going back up you look

at um uh core CPI which is sitting at

5.6 percent right their target is two

that's their measuring state so the

reason why I think he's serious is

because the numbers are too high the

numbers are sticky and they're not

coming lower so if he's serious about

fighting inflation which I think he is

then he has to do what he said he's

going to do and again he reiterated that

with the fake zielinski and that's the

hire for longer okay now uh PC this

morning uh those numbers I I want to say

I want to pull the the services uh

figures here it seemed like Services

came in at expectation core services and

we know pce runs lower just the way they

measure it right uh is it possible that

we really did peak in June of 2022 and

that yeah maybe it'll take longer to get

these numbers down whether it's CPI or

PC but in a year from now are we going

to be at two percent inflation are we

going to get it down I I hope so but the

data just doesn't support that right now

um again this Services inflation is

sticky you know core Services inflation

minus energy sticky at seven percent you

know that's a that's that's a that's

that's roughly 70 of CPI services and

it's not falling

um and you also have now Energy prices

going back up right Biden ran down the

spr right strategic Pro strategic

petroleum Reserve

um so what happens when we have to

refill that what happens if OPEC

continues to cut right we're going into

driving season oil prices but more

importantly gas prices which are have a

a hugely High correlation to the energy

component of CPI we did the math I think

it's around like 85 percent if you look

at just retail gas prices oh wow uh

against the um energy component of CPI

that the r squared correlation going

back multiple years is it's like 85

percent so as gas prices go up that

component in CPI is going to go up and

that's been a key driver of the downtick

right that's a way of saying you could

sort of see a leading indicator of what

CPI is going to be just by looking at

gas prices which have been coming up

right not to be confused with diesel

prices coming down but gas prices for

normal Americans going up if if any of

your viewers want to just do this

analysis it's very simple look at the

energy component of CPI on a monthly

basis go back about 10 years and then

track that against retail gas prices

which we get daily and you'll see that

the r squared correlation is nearly

perfect so the fact that those prices

are going back up has to be scary to the

FED if they're looking at this data I'm

sure they are so the idea that he's

going to quote unquote pivot I think is

it's it's it's I don't know a better

word than ridiculous I think it's it's

just not going to happen what about this

d dollarization uh you know we've lost

some clout in the Middle East

potentially a lot a lot of talk about

now uh Saudi Arabia and Iran partnering

and they used to be mortal enemies now

with deals negotiated by China right uh

are we losing uh the the strength that

we once had the soft power strength that

we had and our people respecting America

less and trying to move away to

different Alternatives or is this just

the same story we've heard before yeah

that's that's a great topic and

currencies is one of the hardest things

to predict um I I'm definitely not

better than anyone else out there but

what I'll say is I think there's two

different things to focus on here number

one dollar deal you know the idea that

we're going to move to some of the

reserve currency I think is ridiculous

um still I think roughly 60 of the

world's reserves are in US Dollars uh

the United States despite all its

problems is the most stable democracy in

the world

um you look at you know China where you

have a dictator who's running you know

labor camps and slaves and you know look

at what happened to Jack ma it's not a

real democracy you look at Russia I

don't think I even need to talk about

that they invaded a Sovereign Nation

um you think about some of these others

so I don't think there's risk of us

moving to another Reserve currency

anytime soon what I will say though is

if pow is reckless which scares me

um I think the value of the dollar could

decline significantly

um and if that happens you're going to

have inflation in the United States that

brings a lot of people to their knees if

they're not already there so wow I don't

think there's risk I I think that people

are just playing this is something we've

heard for years oh we're moving away

from a dollar just like the numbers

right reserves again US Dollars 60 our

democracy is the strongest you don't

have people you know um getting in boats

in the U.S trying to get into China you

do have people getting in boats in China

going through Mexico trying to get into

the U.S we're still the best and I I'm a

patriot so you know add that to this but

we we're still the strongest in the best

country in the world and that that has

that that psychology has a lot to do

with the strength of the dollar so I

don't think there's any risk of us

moving but I do think there's risk of

you know them printing a lot of money

and devaluing the dollar and if that

happens I think you will have a lot of

people here that are brought to their

knees and then it's true by the way

you're getting an awful lot of an

increase of Chinese Nationals coming in

through the Mexican border right very

interesting okay now we have to talk

about Tesla so when when are you going

long test do you own a Tesla I do not

have you ever driven it I'll show you

the cars I own okay I have I've driven

one uh I actually drove the

man this is a great story you won't

believe this okay so this was like 2000

I think it was nine or ten okay um and I

remember I forget the guy the IR guy's

name at Tesla but I was out doing like

um

I remember I so I was out doing like

some solar meetings in California and

the guy said you got to come to our

plant and he let me drive the Roadster

and it was like driving like a electric

go-kart oh yeah yeah it was really fast

and I went to their plant no there were

no cars being made and I was going to

initiate on the company with a buy I

swear this was that it was when it was

35 and you know 15 split ago yeah

and a couple of my clients were like if

you initiate on that stock with the buy

we're leaving

and it's not that it's not that I let

that influence me but yeah you know it

kind of influences so I said you know

what I'm just not going to touch it

um so that that's an interesting story

and it wasn't that I was extremely sold

I didn't even meet Elon it was just

I I just I was just like this is a new

product and you know people like me

products anyway so

to answer your question get back to your

question what what would get me to buy a

test look we have I think it's I think

the stock is worth 24.33 and I know that

sounds crazy but I'll you know I'll tell

you this when when tilray was at 300 I

think we had like a 40 Target people

said you're crazy

um with sun Edison which went bankrupt

um we had a buy rating at 30. they did

this deal with event and we took our our

30 price Target down to one dollar when

the stock was 19. people said you're

crazy

um in First Solar I remember this is

back in 2009 when the stock was like 230

dollars I think we had a forty dollar

price target people said you're crazy

look I think that's what the stock is

worth when it gets there we'll

reevaluate

um but I think there's a lot of issues

which we can get into

um and you know are you using sort of

the industry average multiples and no

we're using a um

I I actually think that the the numbers

we're using so to answer that we're

using a a 20-year DCF okay projecting

out cash flows discounting those cash

flows backwards or something

um uh we're using I think the the

discount rate we're using is around

eight percent yeah

um but so you know and what I'm saying

is the assumptions we have in our model

to get to 24 I think are pretty

aggressive

um what kind of volumes are you thinking

um I think we have them getting to like

10 million okay so you'll actually have

them getting to 10 mil right but your

DCF is still putting them at 24 today

correct that's scary right because the

thing is think about this right so Tesla

did what 73 cents um in q1 you you

multiply that by four and divide it into

the stock price today you're talking

about just under 60 times multiple right

the industry trades it seven times this

is for a company who effectively cut

prices roughly I think it was like 10 in

q1 yet solve volumes grow just four

percent right that means they're cutting

prices and they're not seeing the

elasticity think about this what if

Lamborghini cut their prices by 20 right

or forget about Lamborghini Porsche you

understand people will be running to the

dealership right if if that 200 000

Lamborghini people the elasticity would

be massive so the issue with Tesla is

very simple in our view

um you have a company who over the past

four quarters has produced more cars

than they've sold that's a record

um you have a company who's cutting

prices and you're not seeing the same

increase in unit volume that you're

seeing in price Cuts that's a big

problem you have a company who in our

view is the Blackberry of EVS I.E

they're the first guy out there but now

you have all these guys coming in with

cars that have equal or better Real

World Range better interiors and real

service ability

um and a long history of um you know

being able to make it you know Tesla's

never been through it's a frontier asset

essentially they've never been through a

full business cycle

um so I just think that there's

significantly more downside because you

have you know all this competition and

it's not necessarily Tesla's fault right

think about this right the cost of

capital right over the past three years

think about 2020 2021 early 2022. if you

said EV you could go raise billions of

dollars and create a car company out of

thin air but the demand the demand for

those cars increase right you have all

these new cars companies all these new

EV car companies but like is there is

the demand for are there more people to

buy the car so what I think is going to

happen we highlighted this last year is

inevitably you're going to have a price

War because it's just Supply demand if

you have more cars same amount of demand

you're going to have to cut your prices

to move those units and because Tesla's

the first guy in there they haven't

really invested in r d to you know come

with new models every car company you

know new models every one to two years

Tesla's essentially have the same models

since Inception

um uh and I think that's a problem so

you have all these issues you have the

issue with you know the specifically

Elon Musk around you know the full

self-driving he's been saying we're

gonna have full self driving next year

since 2014. you have you know

um you know all the things he's done you

know the fake solar panels he did to

sell SolarCity

um filing a 13d instead of a 13g clear

violation of Securities laws to acquire

Twitter the things he's done on Twitter

um you know forcing his workers back to

work in California at the height of the

covet crisis against a county order

um and and calling a hero a pedo and a

number of other things so I think that's

in uh you know uh upset if you will some

of his buyers

um and we've said this before in a lot

of instances you know having a Tesla car

now is analogous to wearing a red Mega

hat

um and I think that you know his core

constituency was you know on the liberal

side and I think now that he's kind of

whether it's true or not moved over to

the conservative side I think that's

hurt him too so there's a fundamental

aspect and then there there's a

quantitative aspect and there's a

qualitative aspect both I think are

working against them

and if you look at what's happening in

China I mean so so far this quarter we

just put our time in no doubt

um the the numbers came out early this

week you've had six votes go from China

to Europe last last quarter over the

first 26 days of the uh of the quarter

you had 13 votes so significant decline

in boats to China

um so the cells domestically in China

are better than they were last quarter

but they're not significantly better

despite the fact that you're not having

all those cars produced go to Europe

that's a big problem they're just not

selling the cars in China they need to

that also suggests the demand in Europe

is a week you saw today again they cut

the model y seven seater by another

thousand dollars that's the seventh

price cut in the U.S this quarter and

yet and still their inventories are

going up look this is just a company

that has too much capacity versus demand

I think they've reached saturation and

the competition is coming and coming

heavy

um so I think that you know I think our

price Target is going to prove accurate

when it hits our price Target we'll

reevaluate but you know we don't hate

Elon Musk or hate Tesla it's just we

think the stock is grossly overvalued

and when it gets valued accordingly we

will reevaluate but it's not a tech

company right they're last in FSD

um uh they're buying batteries from catl

and Panasonic all the promises they made

at battery day were essentially

mistruths we now know that the battery

has

um the 4680 battery they had they they

they made is actually worse from a

technological standpoint standpoint than

existing technology so they don't have

any technology either so I think once it

gets valued accordingly we'll reevaluate

have you tried FSD

I am scared to try FSD I have not I have

not and I've seen the videos and I know

I know every experience probably

probably isn't like that but I've been

in a pretty pretty uh the Dawn videos

the dawned uh I've been in a bad car

accident and I'm just once you once

you're in a car accident you're not

willing to risk your life for you know

technology

um what about

um which companies do you think are

beating Tesla in FSD or even regular

competition you mentioned Tesla might be

the Blackberry so which which other

companies yeah so guide house ranks um

uh uh uh uh autonomous driving

Technologies and they rank Tesla dead

last there's probably 20 companies they

rank if not more the ones they have at

the top are uh wamo and Cruz and

Mercedes and byd literally Tesla ranks

dead last So when you say which

companies are beating them in FSD

according to guide house who I trust

everyone

um with respect to cells right byd is

crushing them in China VW is beating

them in Europe

um and in the U.S we now know that over

the first two months of this year their

market share has fell from 75 last year

to 50 this year keep in mind GM's not

even really in the folds yet they're

coming with I think like 15 new EB

models this year it's not the GMS and

the Fords beating them and you know on

CNBC a lot of people like to say but

look at Lucid look at rivien I think

that's cherry picking the guys who are

beating them here are Toyota

um uh VW uh Mercedes

um you know Etc Hyundai those are the

guys who are taking share from Tesla and

beating them in the U.S

um so I think that you know the numbers

just tell the story

um and I think that you know with these

price cuts that aren't working I mean

the proof is in the pudding

Toyota's CEO recently said that they

believe they're part of the silent

majority of people who are interested in

hybrids instead of fully battery

electric vehicles

shortly after he said that in December

he uh announced his retirement and now

the new CEO is talking about moving to

All Battery electric vehicles and

they're talking about a new lineup of

bevs is potentially Tesla just early

here and these Legacy companies uh

realizing wow we actually have to catch

up with real battery electric products

where we really haven't yet yeah I I

think that again yeah I think they're I

think they were early I think they had a

first mover Advantage I think that when

we had the part shortage in 2020 and

2021 I think they were willing to cut

Corners that other people weren't uh

with respect to some of the chips they

qualified in within months where usually

it takes two years

Etc we highlighted all these issues

nobody seems to care but now you're

starting to see some of these cars I

think they have the most amount of their

their cars are recently ranked the most

likely to be recalled Consumer Reports

has Tesla ranked nearly dead lasts on uh

quality slash performance uh JD Power

the same what what question mark which

is a rating outfit in the UK the same

they rank Tesla's cars literally what

what question mark is dead last and

quality performance JD Power and

Consumer Reports either dead last or you

know second or third from last so you

know again this isn't me saying this

these are reputable you know rating

agencies who are saying these cars are

just not high quality so with the with

the new guys coming with all these

different EVS you're getting guys who

have done this for you know in some

cases a decade who you know can ease

think about let me finish that thought

who can easily you know go from

producing an ice car to producing um an

EV card think about this right so when

covet hit right Elon Musk was famous for

saying we're going to make ventilators

right we're going to repurpose our

Factory to make ventilators did he no he

didn't make one ventilator what he did

is he brought a couple of CPAP machines

slapped the Tesco Tesla logo on them

sent it to a hospital you know who did

repurpose their facilities Ford and GM

right

about this World War II right when we

needed tanks Ford

in just their facilities to make tanks

right these guys know what they're doing

and what's more important is the ICS I

see

Eternal internal combustion engine

manufacturers they make cars out of

profit they're ice cars right those cars

have profits on them they're losing

money on their EV cars and I would argue

that barring China Tesla might be losing

I don't think the Fremont Factory is

profitable I don't think the this is my

personal opinion I don't think the Texas

Factory's profitable I don't think

Germany's profit I think the profit is

in is in China and if you look at their

um you can't tell now with the 2022 10K

but in the 2021 10K you work the numbers

out they tell you the only profitable

facility is China why because they got a

sweetheart deal there because you're

able to you know I'm not saying Tesla's

doing this but in China you're able to

hire slave labor everything's cheaper so

you know the point is

you know outside of all the what I think

is

um uh accounting Shenanigans

um that is going on at Tesla

um the reality is they need to generate

cash and I think that you know this year

they have to pay taxes in China that

deal gets less and less sweet each year

um and I think that making EVS is not

profitable right now but I think the ice

can do that they can make these cars

unprofitably because they're they're

their their core constituency of selling

ice cars are profitable so they can use

that profit to invest in the uh the EV

space so I think that puts Tesla at a

disadvantage when a lot of people

thought Tesla was at an advantage so

what do you say to people who respond

and say well Chevy tried with the bolt

to have an EV and they just can to the

bolt right uh the it seems like they're

cutting jobs at Chevy Cruze uh their

autonomy division it seems like most

companies even byd are focused on let's

provide some simple Adas tools that we

know will work like uh Lane keep assist

something we can go to market with we

can bolt on but most industry reports

show that Legacy automakers have a ten

thousand dollar cost disadvantage in

making EVS compared to a Tesla right

when when does that switch are you

suggesting that the ice will catch up

and somehow they'll get that Advantage

back that's a great point so if you look

at Tesla's margins with the most recent

price Cuts you're talking probably about

18 17 to 18 margins that would put them

below most automakers all of a sudden

they're not the manufacturing leader

this is already happening

um and with respect to you know GM

canceling that car that's normal right

so they're replacing that with another

EV right you introduce new models I

think that's they're replacing it with

another low-cost EV so while while a lot

of Tesla you know fans and you know

Bulls come out and say hey look look

look at this

replacing it with another EV so I don't

think it's them getting out of the

business they're just they're just

basically updating the model and I think

with respect to cutting people look

people are struggling right I mean you

know the economy is not great despite

what you know some politicians may tell

you so it's not just you know the car

companies cutting employees right

there's a ton of tech companies cutting

employees uh you know uh there's job

Cuts being announced every day so I

don't think this is um specific to the

Auto industry I think it's a more

economic thing do you think that could

be potentially why Tesla doesn't have

that demand elasticity going back to one

of your original arguments that hey

you're reducing prices but it doesn't

seem like maybe we're getting as much

throughput while at the same time I

think you would agree they are ramping

production substantially right uh is

that maybe more macro if we were back at

uh you know you finance your car for 1.5

percent Tesla would be having wait lists

I think it's partially macro but you're

seeing tremendous growth from guys like

GM byd VW Hyundai Toyota

Etc and their EV sales their EV sales

are growing whereas Teslas are

stagnating despite significant price

Cuts so I do think there's a part of it

that's macro but I think there's a big

part of it that's I think Tesla has

saturated the market and I think that

people are saying let me look at

something else you know it's just

competition right you have you have a

ton more EV cars available you know

before it was just Tesla now you have

you know 10 20 30 options with EVs and I

think people are saying let me try this

other car let me try this other company

my service to Tesla was horrible

um you know my brother is um uh manages

a dealership in California he said

someone came in with their Tesla and

this is one person I don't want to say

this is everybody but he called me up

two days ago he's like call me back

immediately you got to call me and I was

busy I called the next day and I'm like

what's up and he's all excited um he's

like look you know people are bringing

in their Teslas and they're telling me

that like there's this scheme that Tesla

is doing where you know you lease a car

and you you can't buy it and then they

tell you you have to buy a car and then

you go to and then they tell you they're

bought they'll buy the lease back and

then you go to sell them the lease and

the price they told you they would give

you they cut it lower when you go to

sell it so he said there's been a number

people people that have come into His

dealership saying we want to trade in

our Tesla we'll never buy another one

because some of these schemes they're

doing and again I don't know if that's

widespread this is just you know a

couple of guys in California but you've

heard a number of things like this right

on Twitter I suppose I would say it's

very likely that anybody showing up at a

dealership with a Tesla does not like

Tesla so you probably have a

disproportionate share of unsatisfied

people right that's fair that's fair uh

but just the serviceability has been

extremely questionable

um you know and some of their tactics

just you know that we've seen have been

questionable but that's that's not the

bark of our thesis our thesis is

basically competition is going to come

in

um competition is going to crush them

because they're the Blackberry of the EV

space they're gonna have to cut prices

margins are going to get cut and people

are going to see this is just a car

company that's the Auto industry every

auto company outside of Ford and all the

new EV guys has went bankrupt why highly

Capital intenses extremely low margin

and I think Tesla has been able to Stave

that off because of a number of things I

think kova was the best thing that

happened to Tesla because you had all

this stimulus come in you had part

shortages and they were willing I think

to do things and other auto automotive

companies were not willing to do and I

think that brought them a couple of more

years but I think now we're getting back

to the mean level of what the Auto

industry is and I think that's extremely

low gross margins extremely high

competition and extremely Capital

intensive and that is not what Tesla's

stock is priced for now some say that

when it comes to Tesla Service there

potentially is virtually no service so

is that do you think that's then unique

to just all EVS or do you think Tesla

has a potential Advantage here no no I

think Tesla has horrible service I mean

that's that's what I mean pretty much

how are you evaluating that

um you don't own a Tesla right

um I don't own a Tesla thousands of

um entries into you know some of these

different online forms a number of

entries into

um you know Twitter that I've seen and

some of my friends who have owned Teslas

who have had minor you know one of my

friends he's a cult

um he loves Elon Musk he owns a Tesla

he's in in Florida and he brought I

think he brought the model S you know he

paid like I think 75 000 for this car

he's already had to take it in like

three times

um to get it serviced you know I brought

a 10 year old Porsche and I haven't had

to take it in once

um you know so and and when he takes it

in to get service it takes a long time

now he won't say anything bad about Elon

Musk but this is a real world this is my

buddy who's you know having these issues

um and I've heard similar issues from

other other people out there so

look

I'm not saying that I have the I know

everything on what's going on with

service but I think in general if you go

to Google and you type Tesla Service I

think the stories you'll see will be

quite bad and I think that's that's

causing demand in the U.S to waiver and

you're seeing that with respect to these

price cuts and despite these price Cuts

even today if you go and check their

inventories they're spiking higher

despite you know massive price Cuts so

it doesn't I don't I can't say exactly

what it is but something is causing

demand for Tesla cars to decline

significantly and again the stock is

just not priced for that you know this

you're talking about a stock that's

priced at Tesla is valid if you look at

their market cap I think right now it

used to be the next seven largest

automakers combined it's probably now

the last next five largest automakers

combined despite selling like just I

think four percent of the cars they do

so for that valuation it makes sense

they should be selling their quarter

over quarter growth should be

accelerating significantly they

shouldn't be cutting prices they should

be raising prices because if they're

worth more than the next five largest

automakers combined that means demand

for their cars should be astronomical it

should be in the stratosphere and we're

seeing the opposite of that is it

possible that you're comparing q1 to Q4

where generally in Q4 you have this Rush

of demand and a q1 you have the seasonal

decline in demands is that possible no

no because if you look at what happened

with again byd VW

um uh Toyota Hyundai Etc uh Neo leado I

can go on and on they all saw tremendous

growth Q4 not all but most of them saw

tremendous growth Q4 to q1 without the

price Cuts right you know last year when

Tesla was cutting prices BW was right

BYU was Raising prices in China you

understand so and they still sold a a

massive amount of cars right they saw

tremendous growth so this is clearly

looking at the data a specific issue

with Tesla

um and again you're talking about now

seven price Cuts in the U.S and if you

look at that and by the way the

inventory chart I'm talking about is I

think it's Matt Jung who keeps the data

he just Tesla only shows it's like so

for instance if they have like a hundred

red you know Model S long range cars in

inventory they only show one so that

inventory number that Matt Jung is

tracking which is going up is actually

worse than it appears

the service data to some extent it

sounds largely anecdotal to some degree

like how people as I started this

interview Define you as a bear right

right like anecdotally it seems like a

lot of your tweets are bearish uh so I

think I'm very embarrassed I think the

stock is grossly over but outside of

outside of Tesla as well I think you you

had some frustration in that your

reputation is of Despair but you're not

bearish everything you're one gold long

nuclear which we're going to talk about

is it possible that maybe the service

isn't that bad maybe maybe the the

anecdotes of oh I had to go in for

service but how did that how does that

compare to cars who that gets serviced

three times a year four times a year

regular ice Vehicles yeah whereas Teslas

maybe aren't getting service for a year

or more I mean I can give you anecdotes

on on the two Teslas that I own of maybe

in the lifespan of two cars over an

average ownership of four years I've

been at service four times right that's

an average of uh essentially once every

two years per car right

um sure it's it's definitely anecdotal

there's no doubt about it um but again

the core of our thesis isn't that

service is going to hurt Tesla or

Services What's going to bring them down

the core of our thesis is competition is

going to crush Tesla and I believe that

the data firmly shows that the

competition is crushing them

um and you're seeing that continue into

Q2 right six seven price Cuts in the U.S

um and you know inventory is still

building another price cut just today

um and the data out of China you know

again only six boats into Europe whereas

you had 13 last quarter and still

despite not sending you know over 50

drop in boats you're not seeing a surge

in China sells that's very concerning

this is just data so the data continues

to suggest that things are very bad for

Tesla um you know you have Elon Musk

telling you he's willing to sell car

think about this right he's telling you

he's willing to sell cars at break even

he's going to make up for it with FSD

right here's the problem

the FSD take rates have went from 40 to

5 only five percent of the people buying

Teslas are are buying FSD so how are you

going to make up for selling it doesn't

even make sense you understand so and I

know that's how you're referring to I

think uh part of that could be explained

by uh a higher International sale

through rate of Teslas where you can't

potentially buy FSD yet because of

regulatory challenges you know I was

looking at even in the US though the FSD

rates have collapsed and remain

collapsed I have to look at that but um

what's fascinating to me is this the

guide house insights chart that that you

uh refer to I brought it up and they

throw Tesla basically in the bottom

right and everybody else Baidu zukes

mobile I uh Aurora emotional Cruise

Nvidia waymu those are the leaders right

now their evaluation criteria

let me ask you what you think about this

they evaluate these based on the

following Vision that makes sense but

what about this go to market strategy

Partners production strategy sales

marketing and distribution commercial

Readiness those items in this evaluation

have a similar weight to actually

technology

of of the full self-driving and all of

the items here uh for a beta product are

very easy to anchor down is it possible

there's a massive amount of bias in in

these insights and would you consider

risking your life and trying out FSD

confronting Gordon Johnson and trying

FSD to actually no I would never try FSD

and again I've been in a very bad car

accident okay I've actually been in two

so given what I've seen what I've seen

FSD do by Tesla Fanboys right

um I would never risk my life no I would

not

um with respect to them being biased

look it's you know if they had Tesla

ranked number one I'm sure you wouldn't

say they're biased look you know he

removed a number of centimated okay he

removed a number of sensors he removed

radar right to save costs

um you know it's like you know FSD 2.0

FSD you know and it's like every single

one you even hear Fanboys saying you

know it's getting worse

um and this you don't have to take my

word for it just literally go online

type in FSD and and look at the videos

this you have cars turning into you know

Lanes running over kids and tests

um you have cars you know that are

running into you know restaurants cetera

I mean this is crazy stuff

tesladeaths.com you've had 19 according

to tesladeaths.com verified deaths

associated with autopilot being on these

cars are wrecking into fire trucks I

mean this is crazy stuff you know I

believe any other auto company this is

my opinion that had these issues would

immediately recall it and take it off

the road whereas it's with Tesla it's

been on the road since what 2016 2017.

in fact think about this how do you

trust FSD well we now know the painted

black video right the painted black

video from 2016 which is still on

Tesla's website last I checked

was completely doctored and and it was

directed by Elon Musk it was a video

over 3.5 minutes

um if you watch that video the start of

the video says the driver is only in the

seat for legal reasons right we now know

that his Engineers were not wanting him

to do that but he said let's put that in

there we now know that video was shot

over 550 miles there were multiple

disengage engagements the car wrecked

itself but if you watch that video

you'll think that Tesla car since 2016

can drive themselves that is extremely

Reckless and that that's the best way I

can put it so to put your trust in

someone who's willing to do that with a

video how is that different than Trevor

Milton rolling a truck down a hill how

is it different I I don't know right

nobody died is alleged to have died

because Trevor Milton rolled a truck

down the hill tesladeaths.com has 19

people and counting that have died

associated with you know Tesla's um uh

Automotive uh automated technology so I

think it's it's extremely Reckless what

he's done the reason why I would not

test it is because of things like that

and other mistrusts that Elon Musk has

said and if you watch the Hulu

documentary you have two former

employees saying yeah we left the

company because they were making you

know egregious claims associated with

FSD these are former Tesla employees so

no I wouldn't put my life at risk and

look we are factoring no legal liability

our working assumption is that Tesla is

above the law they will never have to be

if they go to court they'll always win

they'll never be prosecuted for any of

this

um uh or have to pay for any of this but

if you think about what's happening it's

it's a real dereliction of Duty from

Nitsa to allow this stuff to continue

he's testing beta technology that isn't

what he said it was in 2016 on the road

that has been alleged to have taken 19

lives I think that's that's pretty

compelling

is it possible that Tesla's haven't been

taken off the road because this 2016

video which let's agree that the claims

were substantially exaggerated in 2016.

that's now hold on seven years ago I

gave you a shot sorry sorry so seven

years ago uh we have this video that had

exaggerated claims let's agree with that

is it possible though that Teslas aren't

being taken off the road because the

accident rate per million miles driven

is five times fewer than a regular ice

right so that data from Tesla has been

thoroughly refuted and we now know it's

not true Nitsa actually Switched at the

2016 data or the a million miles the

million mile accident data we now know

that that data is completely I shouldn't

say completely but it's farcical because

it's comparing miles driven on the

highway to other cars where mile or

miles are driven in city it's like

you're preparing apples to oranges so to

use to continue to cite that data when

it's been thoroughly disproven I think

is misleading I'm not saying you're

misleading but anyone who who's doing

that is being extremely misleading so

it's not safer number one one and number

two I think the reason why it hasn't

been taken off the road is because I

think you've seen a dereliction of Duty

from Nitsa

um NS the NTSB has stated essentially

this stuff needs to be taken off the

road but they can't act they can only

make recommendations it's only Nitsa

that can act so and again this is all

our opinion but I believe that you the

reason why it hasn't been taken off the

road is because you've had a massive

direction of Duty and you know our

assumption is it'll never be taken off

the road that's our working assumption

uh because if it is you know our price

Target would probably move lower from

2433 right now so again I think that

what's happening is is scary

um and quite frankly when I see you know

given what my research and the years of

covering all this and the many mistruths

that have come out of Tesla around FSD

when I see it Tesla car on the road I

keep my distance uh because again you

know when you've been in an accident a

car accident you don't take any risks

so uh clearly you're disputing the the

data from Tesla and Nitsa which which is

this has been thoroughly debunked

um and and and Nitza I I think it's

either NTSB or Nitsa has agreed that

they were wrong in the way that they

conducted their study the Elon Musk he

uses that that that that the verbias

they use they get there was a I think it

was a New York Times article I'll send

it to you yeah

detailed that this this this this claim

that Tesla's making has been thoroughly

disbunked this came out like last year

so this idea that Tesla is safer has

been thoroughly debunked debunked I'm

sorry um and there was I think a New

York Times article on it yeah it seems

like recently in the last Q4 impact

report they're now reporting uh it now

in fairness it says mostly but they say

autopilot engaged mostly on highway

miles 0.18 million or accidents per

million miles uh mostly non-highway

miles 0.31 no active safety 0.68 and

then the U.S vehicle Fleet accident rate

at about about two to three times that

at 1.53 do you dispute that recent data

as well no I'd have to look into the

recent data um but I know that the claim

you're making with the million miles

driven and Tesla being the safest car on

the road that data has been thoroughly

debunked well you did you mentioned that

you were debunking because that was

mostly highway but now they're parsing

out even non-high right I I to be honest

with you I haven't looked into the most

recent data okay it's when I say I

haven't looked into it I don't know what

the uh the expert opinion is when I say

this has been debunked I'm not saying by

me I'm saying by the experts right so

I'd have to look at what the experts are

saying I I can't I can't speak to that

would would you say uh New York Times is

the accident I'll say this I do not

trust anything

I I shouldn't say that but I I'm I'm

highly

I'm highly highly

um uh distrustful of anything that comes

out of Tesla given given uh you know the

the painted black video given the 13d

instead of the 13g given he said he was

going to make ventilators he sent CPAP

machines given he said he was going to

fix the issue in Flint he didn't given

he called the guy a pedo given he said

he was going to have a million Robo

taxis on the road in 2020. given he

continues to tell people he has more

he's selling more cars than he's

producing where the past four quarters

he's produced more cars than he's sold I

can go on and on given you know early on

right the the the documentary now that

is on um uh it's on tuvi to be right we

now know that when he did that battery

swap to get the the tax credits in

California that was also doctored so

there's all these things that he's done

right that any sane person would say I

don't trust what this guy's saying so

I will say that I'm not going to say I

disbelieve it but I'm saying I need to

prove what he's saying before I'm

willing to believe it

sounds like you don't like Elon

no I'm not liking Elon it's just about

being a some of the story is maybe no

it's just about being a human being

right if somebody tells you for five

years in a row that two plus two is five

right and then you come to me and say

Hey you want this guy to do your math

problems for you I'm like no I don't

want that guy to do my math problems

right there have been a lot of mistruths

that this guy has said

the Tesla devs credibly alleges have

potentially led to death so you know

every car company has In fairness well

no not not every car company has said

not one car company has said our cars

are driving themselves the guy is in the

driver's seat only for legal reasons in

2016 and every year since essentially

2014 said we'll have full self-driving

better than humans on the road next year

nobody said that except for Tesla

probably the best thing on the FSD part

is for people to evaluate that

themselves I would imagine and I

understand that you've been in an

accident so you're unwilling uh to test

FSD I did though I want to pull up the

New York Times thing and I found it and

you're right they said these figures

always show that accidents are less

frequent with autopilot right a

collection of technologies that can

steer break and accelerate Tesla on its

own but the numbers are misleading

autopilot is used mainly for highway

driving which is generally twice as safe

as driving on city streets Tesla has not

provided data that would allow a

comparison of autopilot safety features

on the same kind of Roads neither have

any other car makers however now they

have and so I know you haven't looked at

the new data yet but it would be

interesting to the the question that I

want to frame out of this is is it

possible that yes Tesla may have made

mistakes in the past and and maybe

elon's been Reckless with his SCP SCC

filings is it possible they can fix

these in your in your mind no because to

get to level five

um autonomy you need lidar and radar and

Tesla does not have those who says that

well any experts you speak to in the

space

um we've spoken to I don't want to say

their names but we have a number of

um you know autonomous driving

technology experts we speak to I think

Tesla will never let me be very clear

this is our opinion I think Tesla will

never with its current technology get to

level 5 Adas it's impossible in our view

they need radar they need lidar and

they're talking about doing late radar

but they're not going to do lidar

without both of those I don't think it's

possible to get to what they claim that

they're going to get to very fair so one

thing that I want to bring up is you on

your website you have the uh your

research you were forecasting negative

free cash flow we didn't go negative but

it came in substantially lower than

expected right and earlier you mentioned

some potential accounting Shenanigans of

like potentially depreciating some of

their or capitalizing some of their

their Capital expenditures to to butter

out how much they're spending tell me

about their cash position because they

have had cash flow it's falling they're

spending money on these new Factories do

you think that if Tesla does go negative

free cash flow and cost of capital is

higher now that would be a big Catalyst

for the stock going down I think it

would be one Catalyst yes but I think

that and again when we say Shenanigans

these are our opinions

um there's

you know when you provide Gap accounting

statements there's a number of things

you need to be able to say definitively

we can't say that definitely these are

our opinions based on the fact that you

know in you know you know they're capex

right in the first quarter yeah was more

right in the first quarter of this year

they're not ramping any plants right

their capex is more than when they were

ramping two plants last year we have

questions around that Tesla will not

answer our calls they won't answer our

emails they never let us ask questions

or calls so we don't get our questions

as answers so we just have to wonder

um but with respect to the cash flow I

think that yeah if it's if it goes

negatively we think it is

um it's going to be bad keep in mind

right

if you look at their cash flow and you

take away the Zev credits they sold this

quarter it was negative it was negative

80 million first time I think since

um 2021.

um and keep in mind a lot of that is

because GM isn't selling EVS I think a

lot of the Zev credits that Tesla

continue to sell is to GM now GM is

about to start selling a lot of EVS

what's going to happen you know so I

think that's something to be concerned

about if you're a Tesla bull I don't

think people are focused on that so I

think there's a lot of risks around the

corner

um that I think a lot of people may be

overlooking but I think the most

important thing right now a lot with a

lot of bulls hang their hat on is unit

growth right and that's clearly what

Elon Musk is focused on another price

cut today

um so I think that he told you right he

told you on the call we're willing to go

to zero percent margins on our vehicles

and we're going to make up for it by

selling FSD again how are you going to

make up for that when you have five

percent attach rates but anyways

um you know a lot of things this guy

says doesn't make sense to us right he's

saying we have more demand than we can

make cars whereas they produce more cars

than they've sold more four quarters and

running a record that's never happened

so again I think that I think that um

you know cash flow I think is going to

turn negative but I think what people

are focused on is units but I think

people are going to be concerned about

the margins do you think it's possible

that uh Tesla could release a complete

Suite of full self-driving you already

said not level five but of let's say

level two and a half uh and and maybe

then start recognizing some of the FSD

Revenue well they've already recognized

significance amount significant amounts

haven't broken down how much they've

recognized something you're right they

break it down into the q's and K's

they've recognized significant amounts

of SSD Revenue keep in mind FSD is

vaporware it does not exist there is no

such thing as full self drive it is

vaporware that's a fancy way of saying

it's a product that doesn't exist the

fact that the FTC allows them to sell

this is a mystery to us

um but nonetheless it it's allowed so

but yeah so if they released you know

level two 2.0 right they've been doing

that every single what month for the

past five years right 1.1 version 1.6

whatever

um and you know even the Fanboys are

saying it's getting worse right if this

quote-unquote Dojo computer or this you

know the the arc invest thesis that

they're collecting millions of miles of

data which I think is completely farce

it's a complete farce I don't think

their cars are learning

again if you talk to The Experts this

has been disproven as well but you know

you're having the same issues

um at the same intersections Etc and

you're having new problems emerge so I

just think that you know FSD is

something that was used to you know

raise money and allow you know sell side

analysts to have these farcical you know

fan Fantastical price targets

um and we've said all along that it's

not what it's chalked up to be and we

said that the reason why we said that by

the way is because two years ago via a

Freedom of Information Act request there

were documents that came out between

Tesla's lawyers and I think the

California DMV were in that

communication right Tessa the lawyer

said our FSD our autonomous Drive is

level two and it will always be level

two that's what they said in those

documents right the problem was because

the stock was going up we were reporting

on that nobody cared they're like no no

you're wrong you're just a hater

um so look I think that you know this

FSD hope is something that can continue

to keep people you know engaged and

happy about the stock and hopeful and

that's great for Elon Musk and Tesla but

the reality is the competition has

passed them everyone according to guide

house and you know with their current

technology without lidar and radar and

taking sensors out they'll only ever be

level two so until he fundamentally

changes

um I don't think he's going to achieve

FSD and Elon Musk himself said if we

don't achieve FSD Tesla is a zero

dollars he said that I didn't say that

he said that I'm not saying that's our

belief right we have a 24.33 price

Target but you know more than zero hey

you're a bull yeah I mean but you know

you know if you put a 7 times multiple

you know you know earnings that are fair

that's not how we evaluate but sure you

you're talking about like a 20 stop so

you don't buy at all the Kathy Wood

Brett Whitten argument of let's price in

some degree

I don't want to speak ill but what I'll

say is

um you know

we we had a debate I think we debated

her it was it was a Montana skeptic and

I debated her

um at the Robin Hood conference I think

it was in 2018. I got Robin Hood socks

on nice they were free I love the

conference those are nice socks

um so but you know her thesis then was

Robo taxis it's all Robo taxis you know

in 2019 you know they're going to be

doing billions of dollars of Revenue

they haven't done one there's not one

Robo taxi on the road so she got lucky

in our view glj researches view because

of covet hit you had you know all this

massive amount of money that was dumped

into the market and every stock went up

right AMC went up uh you know every

stock went up Tesla was the leader of

the Mims and because the stock price

went up you know it was like her thesis

was validated even though her thesis has

been 100 incorrect if you look at her

Tesla Model it's riddled with holes and

mistakes and when these mistakes are

pointed out as we recently did on

Twitter we get no response from Brett

and Kathy or Tasha

um and this isn't talking ill of them

I'm just saying like you know we make a

small mistake right we got the cash flow

number wrong you highlighted that she

says they're gonna have like 2 million

Robo taxes on the road there's not one

and yet nobody talks about it so

um you know I think that you know her

models are I think incorrect um I can

tell you where she's made huge mistakes

um and I think that you know when you go

out and you say you know pre-split she

said it was a two thousand dollar stock

now post split she said it's a two

thousand dollar stock right and you put

these Fantastical price targets out

there you attract attention and you know

so you think maybe it's more marketing

than I think so I think so because

selling a Sizzle before the stake well I

mean just think about it right I mean

her bear case is like what like uh 500

upside

um so it's just it's not realistic and

but you know when think about it

Kathleen would if you had if you ran a

hedge fund right look at what her

performance over the past two years and

you had that performance you'd be out of

business she's she's breaking the dough

in right because she can say we're going

to grow 50 or whatever her number was

it's like 50 every year and people get

excited and give her money and then she

charges an exorbitant management fee and

whether she's right or wrong she makes

money so I think that the marketing is a

big part of it um and it's unfortunate

because those people could be allocating

their money the money manager money

managers who are performing which I

think would benefit them two more Tesla

questions and then we'll move on

um you tweeted that when people find out

in 10 years the battery is dead by the

way with your you know Emoji here uh

that in 10 years when the battery is

dead the replacement cost is thirty to

fifty thousand dollars right where did

you get that that number that was wrong

that was wrong I think the replacement

cost is around ten to fifteen thousand

dollars okay

um so yeah sometimes we're not we're not

100 accurate in our tweets but the point

is you know

this is another thing we saw on Twitter

like there's Tesla there's used Tesla

cars uh let me know you say that because

I forget the exact point but the point

is like

a used EV is not worth as much as a used

ice my my car right is Gonna Last me

you know it's 10 years old it's going to

ask me another it's a Porsche um It's

Gonna Last me another 20 years right if

I wanted to if I take care of it you

know your your EV car that battery when

it when it goes out you're gonna have to

replace that that's a replacement cost

of 10 to 15 000 right you and me that

that's fine right you more than me

probably but we can afford that but you

know the average American cannot so

forcing an American you know forcing an

American to take an EV without them

understanding that cost but more

importantly once these cars are used and

that knowledge is widespread and well

known the used value of EVS is going to

collapse and that will hurt the new

cells of EVS so that's that's the point

we were trying to make last point on

Tesla because you're very clear on Tesla

right but the last point you mentioned

that they haven't come out with new

models cyber truck right

I mean so you know right think about

this right so when they did the Cyber

truck launch right what is it like three

or four years delayed now so when they

did the Cyber truck launch they were

saying it's going to be a 40 000 truck

right we'll see if that's right I think

it's probably gonna be double that price

I personally think it's not that great

looking uh given the issues they've had

with their cars I think the specs are

going to be significantly different the

price the range Etc are going to be

significantly different than what

they've promised so I can't predict the

future but what I can say is when they

when they announce that truck we said

the day they announced it there's no way

it's going to be that price and it's

going to be delayed and we were right

um so we'll see what happens but I think

that you know this this idea that they

have all these orders and that all these

people are going to buy that truck

I think it's going to be significantly

underwhelm

um so we'll see what happens

next topic you talk about housing bursts

2.0 yeah what do you think we've seen

housing prices fall from about May to

December uh Nationwide average around 10

some areas uh have been you know the

Phoenix's have been more like 20 Austin

um how is that going to affect this

economy that's a great question so you

know

we're currently renting

um but you think about it right a lot of

the spending patterns in the US are

driven by housing and more importantly

how much you think your house is worth

or how much it's worth so we've seen

housing prices fall for the first time

you know annual annual housing prices

fall for the first time in a long time

right mortgage rates are up the price

the cost of a house is up significantly

why why is it though because the FED

brought mortgage-backed Securities and

they never stopped since 2009. that

literally they're printing money out of

thin air and buying houses that's the

way to think about that that is unfair

to young people who are trying to buy

houses right it's great for people like

you and me who not me anymore but who

you I used to own a house great for us

because our asset value goes up sure but

this is artificially boosting the price

of houses now you have mortgage rates

you know 30-year fixed mortgage rates

that were what two percent under three

percent not that long ago now you're

talking about just under seven it's just

it's just a matter of math it's just

more expensive to have a house so what

happens is it's more expensive to have a

house right

um people are making literally the same

amount of money mortgages are more

expensive so you're going to have less

demand so what I think has happened is

and this is proven in the data you have

a lot of people during the housing boom

that brought second third fourth homes

as Investments and I think right now

they're keeping those houses off the

market because they think we're going to

go back to the euphoric period but if

you think about the last housing bus

right 2007-8 what happened was the

decline in prices started in the East

right you're talking about places like

you know Florida

um you know basically the east coast and

then the people in the west didn't see

it they say hey we're going to be fine

it's not going to hit us and then it hit

them slowly worked its way true now it

started on the west and I think it's

going to work its way to the east

interesting and I think it's just math

it's just that it's more expensive and

you have this less demand

um and as prices start to fall right

from Peak to trough I think San Fran's

down like what like I think 16 a lot of

the places are down you know a little

less a little more than that on the west

um and those declines are starting to

pick up so I think what's going to

happen is you know prices price decline

is going to start to fall more

and once those people who are holding

that inventory off the market put that

inventory back onto the market that's

what happened in the global financial

crisis

if there's like 3.5 units if they put

just like I think 10 of that 20 of that

this is all the vacant properties not

fake uh it's it's it's properties it's

not even necessarily vacant it's just

properties that are being held off

Market okay for whatever reason correct

like you know let's say you own three

houses right and you clearly you're not

saying in all of them maybe you're

renting a couple out it doesn't matter

but you're not putting them on the

market because you think prices are too

low right but let's say you're in I

don't know you're in Phoenix and all of

a sudden prices are down 10 now they're

down 20 you start to panic what happened

in the global financial crisis

people started to put those houses on

the market right more Supply same demand

prices fall yeah more Supply saying

demand prices collapse oh yeah so I

think that what that is what could

potentially happen I don't know if

that's gonna happen but that's what the

data is suggesting and if that happens

how does it affect the economy when your

price when you're the how the value of

your price the value of your house Falls

right in your mind and rightfully so

your wealth Falls and when your wealth

Falls you stop spending as much and when

you stop spending as much the economy as

effective the wealth effect of course so

you think a big risk to real estate

right now is the potential collab or the

rise of inventory because right now we

have very shallow inventory in fact the

first quarter much like we saw a very

seasonably warm January which led to

retail sales blowing up potentially due

to seasonal adjustments as well we've

seen some markets take up again in the

first three quarters will that flip-flop

back down when inventory Rises if

inventory Rises right so I think I think

the season know the blip we saw I think

is somewhat seasonal but it's also

because remember rates fell mortgage

rates fell a little bit right 7.3 I

think 6.4 yeah and that creates a lot of

Demand right at the margin but again

with with inflation now turning back

higher right with the FED telling you

we're going to do we're going to raise

rates two more times and keep them there

for a long time

um and yet the Market's saying you're

going to cut rates two times before

you're in I think there's a mismatch so

once rates correct to what the FED is

going to do rates go back higher

mortgage rates go back higher I think

you're going to see a further law in the

housing market what percent downside do

you see in housing and then what does

that translate to in stocks that's a

good question that that's a very tough

question I would just say you know the

last housing crisis I think peaked the

trough a lot of prices were down 40 to

50 percent and I think we'll see

something similar I I would say look at

where prices were pre-pandemic and look

at where they are now and I think we're

going to go at least to where we were

pre-pandemic but typically price is

undershoot back to Trend or or even

below that I think it's going to go back

to where the the price was not even not

even Trend back to where it was where it

was potentially lower and if that

happens you know I think that it's going

to have I don't know what the effect is

going to be on the stock market but I

think it's going to have a profound

effect I would say you know we could see

the you know the prep pandemic prices

the pre-pandemic lows that's where I

would probably get a lot more bullish on

everything uh once the s p got down to

that kind of pre-pandemic level wow

would you do that with individual stocks

if let's say you know Amazon or Google

or pre-prandemic levels would you

consider picking those up absolutely

everything okay uh you know once we get

back down to those pre-pandemic lows

those scary lows you know pre you know

fed doing quantitative you know QE