Why Tesla might rip higher again. Also, JPY at the precipice again.

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Today’s Links

Tesla shareholder to get priority access to SpaceX IPO?
Bill Ackman wants to help SpaceX go public with a “special purpose acquisition rights” vehicle that would provide Tesla shareholders with prioritized access to the SpaceX shares. Whatever the setup, which given Musk’s desire to avoid the traditional IPO route could be very unusual, if the market gets the sense that Tesla shares can offer early access for the SpaceX IPO, who knows how high Tesla shares might go. (As always, not a recommendation for a course of action!)

More smart money going to cash.
I forgot to mention this one on the podcast, but this is another sign of smart money - Apollo Management - getting cautious at these very high levels of risk sentiment and raising cash allocations significantly.

Affordability pressure rules out having children for many.
A follow-on article to Mike Green’s viral post on the cost of living with some useful additional illustrations of why Americans are having fewer children than they want to have, if also with a couple of very confusing graphics.

Is half of the global financial system in the shadows and if so, what are the risks?
This is an eye-opener on the scale of shadow banking, which is getting its tentacles into ever more business areas, including insurance.

Are we all participating in a huge pyramid scheme?
The ugly pension math suggests that somewhere down the road, there will be material selling of equities to fund pension payments as dividends and profit distributions are not sufficient, meaning that we are all involved in a pension pyramid scheme with potentially devastating risks. (PDF download link available on that page)

Even Waymo has a way to go, especially when you turn all the lights out.
Waymo is the best-in-class (really only in class in the US, at least) in autonomously driven vehicles, but when the power goes out and stoplights go dark, the rules of the road change, which humans can navigate improvisationally, but autonomous vehicles can’t, at least not yet.

This is ridiculous.
We know why - nonetheless, the audacity, as SpaceX is buying a lot of Tesla Cybertrucks.

Chart of the Day - Tesla (TSLA)

I am far from being a Tesla booster, but I am certainly open to the idea that the stock can continue higher if a speculative rush develops on Musk constructing some way of floating SpaceX that prioritizes access for Tesla shareholders. But one gets the feeling that next year is the year that the Autonomous FSD/Cybercab really needs to become operational and see significant deployment. And SpaceX itself has a lot to deliver as well with its Starship platform after its many blowups and unproven status - yet to deliver payloads beyond a tiny fraction of its rated capacity. The year 2026 could prove a critical one where Musk’s companies need to start deliver more in the numerator of the valuation based on a reality/”future fantasy” ratio. In the meantime, remember that Tesla constantly dilutes shareholders with Musk’s ownership in the company rising after the Delaware Supreme Court ruled that his original huge pay package of more than USD 50 billion must stand.