A Tesla short-seller had an epiphany, but the ridiculous epiphany is that he realized that central banks are going to mostly engineer low-interest rates for decades. This is what should be embarrassing. There have been negative interest rates in Europe since 2014. Interest rates have mostly been below 1% in Europe since about 2009. Japan has had negative rates since 2016. US has had low rates since 2009. This guy Carson Block had to have a dream last week to realize that interest rates will stay low for decades. Low rates for decades is a revelation that he went onto the cable finance news channel CNBC to declare.
He also said that Tesla would thrive but ignored how Tesla is already very profitable. Tesla had over $900 million of net income in Q2 without credits. Credits from competing automakers. Tesla will add 10,000 Model S in Q3. $1.3 B more revenue. More model 3 and Y too. Extra $2-3 billion in revenue in Q3. More growth in Q4. 30% margin cause they had 28.4% in Q2 mostly without S and X. $1.5-2 B in net income in Q3, $3-4B in net income in Q4.
Carson Block bent the knee to Tesla because he realized that Tesla can raise all kinds of money with its high market capitalization.
This was after Tesla raised $5 billion in December 2020 for less than 1% dilution. Tesla has had about $20 billion in cash since December 2020. Tesla is down to about $5 billion in debt.
Nextbigfuture covered Federal Reserve chair Jerome Powell making promises about years of low-interest rates. There can be blips of higher interest rates to quash inflation but Central banks will keep rates low or negative because of the hundreds of trillions in national, state and corporate debt.
SOURCES – CNBC, Bruegel, Bloomberg
Written by Brian Wang, Nextbigfuture.com (Brian has shares of Tesla)
Brian Wang is a Futurist Thought Leader and a popular Science blogger with 1 million readers per month. His blog Nextbigfuture.com is ranked #1 Science News Blog. It covers many disruptive technology and trends including Space, Robotics, Artificial Intelligence, Medicine, Anti-aging Biotechnology, and Nanotechnology.
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