And it’s gone!
Within minutes of the market’s open Tesla’s (TSLA) market cap dropped by $150 billion—presumably in response to Elon Musk’s selling pledge. And by the end of the day its market cap at $1.017 trillion was down $235 billion from its November 4 peak. That’s the equivalent of one Ford Motor Company (market cap=$80 billion), one General Motors (market cap=$85 billion) one BMW (market cap=$69 billion ) combined—and an orchard of partridge-bearing pear trees to boot.
Call it what you will, but the TSLA action had nothing to do with honest price discovery or even rationality. It was just more proof that the Fed and other central banks have unleashed a speculative mania like the world has never before experienced.
In fact, the valuation metrics surrounding Tesla have gotten so absurd as to suggest that the Wall Street speculators and homegamers who have piled into this cult stock are being punked by the financial gods as they roll around heaven splitting their spleens with laughter. Just consider that during the latest 12 months, the lion’s share of TSLA’s net income and free cash flow had nothing to do with making EV autos.