Is the $TSLA stockprice a bubble?

Well, probably, but this has been true repeatedly in the past year or so. Nobody I follow predicts anything but $TSLA becoming $TSLAQ, but this is because I’m human and I like to follow people who confirm my priors.

In other news

Forex: AUD continues to climb vs USD. GBP has been strong recently, but given the huge levels of gilt issuance it is hard to see it stay high. I’m tempted to sell against JPY Commods: SI is going up, gold less so. Fixed Income: Chile, HK, SK, Mexico yields all going up. Turkey, SA and some other developing markets (e.g. Bulgaria) going down. Developed market yield practically flat. Equities generally going up: it’s another risk-on day!

Robin Brooks reckons that the massive amount of stimulus in the USA will be dollar positive. I don’t really see it myself, but Brooks is a serious commentator.

Precious metals

My list of miners includes a mixture of copper, silver & gold producers. I can’t claim any expertise in this area. Metals have been on a roll for a while, but lumber has also been on a roll, which is unusual. In fact, over the last few days, lumber has been trending down, so maybe we are going into a risk-off world. I am not sure that precious metals necessarily are safe assets, but T-bonds are sooo expensive now, they are at least worth a look. There seem to be investors who don’t trust any form of gold other than those which they can bury in a hole in their garden. Call me a neophile, but I’m reasonable confident that Comex will not rip me off.

Housing

I can’t bring myself to believe that Covid-19 is bullish for housing. This post from Wolf Richer suggests that it’s not going to be in San Francisco. Kevin Erdmann has always said that cities like SF drive demand elsewhere, because the supply in them is absolutely constrained, so the demand for close-enough-subsitutes goes up. The economics of housing are difficult: a house is as unlike an apple or a widget as its possible to be while still being, in some sense, an economic good which can be bought and sold. I think Erdmann prefers to think in terms of “housing services” (with rent as a price, not the capitalized price), but I haven’t read his book and I find his explanations on various podcasts I’ve listened too pretty confusing, although he seems to have a clear idea in his own mind of the drivers. It doesn’t help that he confines himself to the US market, which I don’t know or care about. I’d like to apply his methods to the UK, but so far I’ve failed.

Airlines

Bad news doesn’t seem to dent the share price … until it does.

Wrap

Markets seem very “risk on” today: SPX up 0.2%, IWM up 1.4% (although NDX down 1.1%, afer a recent terrific run). Energy jumped: XL$ + 6%, but soft commodities mainly down (wheat up ~10% over a month, so deserves a pause). Global 10yr yields all up, except Germany: presumably some sort of response to the recent EU budget and what Germany will contribute to it. FX largely flat.

I listened to Mark Spiegel chatting to Chris Irons on the QTR podcast. They are both gold bugs, so the end got rather boring. I’d rather listen to Schiff.