What we’re reading (11/27)
“Elon Musk And The Dangers Of Another Stock Bubble” (The New Yorker). “ Tesla now has a market capitalization of almost $1.2 trillion. That figure surpasses the capitalizations of Toyota, Volkswagen, General Motors, Ford, Daimler, BMW, Stellantis, Honda, Kia, and Hyundai combined. If you suspect that these figures are a bit crazy, you’re right. But the real clue to the current mind-set in the stock market is what has been happening to the stocks of Ford, General Motors, and other old-line auto companies. If Tesla, Rivian, Lucid, and other E.V. startups are going to dominate the global auto industry in the coming decades, the logical corollary is that the legacy carmakers are headed for the scrap heap. But, lo and behold, the market valuations of Ford and G.M. have been rising sharply, too.”
“Hertz-Tesla Deal Signals Broad Shift To EVs For Rental-Car Companies” (Wall Street Journal). “Car-rental customers could soon see more electric-vehicle options on airport lots and other places where they are looking to reserve a ride. The rental-car industry, long a big bulk-purchaser of new models in the car business, is sharpening efforts to add more battery-powered vehicles to fleets, the latest in a broader global shift among companies embracing greener technologies to cut their greenhouse-gas emissions.”
“The Value Of Nothing: Capital Versus Growth” (American Affairs). “[T]he U.S. economy is, to a unique extent, organized around maximizing asset values and returns on capital independently of growth—in terms of corporate behavior, financial market incentives, and government and central bank policy. This may seem obvious or even tautological: what is capitalism if not a system aimed at maximizing returns on capital? But the disconnect that has emerged between returns on U.S. financial assets and underlying economic performance—and even corporate profits—over the last few decades should raise deeper questions about basic economic policy assumptions and their theoretical foundations.”
“The Market’s Black Friday Freakout About The New Variant Shows How A Reactionary Wall Street Rules American Life And Politics” (Insider). “The moment echoes that seen over the summer, when the first headlines of the emerging Delta strain put a damper on the global recovery. Subsequent research showed vaccines are effective against Delta, and continued vaccination has helped put the world economy back on track for a full recovery, but the immediate reaction was strong enough to halt many companies' planned returns to their offices in the fall, and that decision resulted in months of weaker hiring before the boom recommenced.”
“Crypto-Trading Hamster That Outperformed Warren Buffett Has Died” (Fortune). “Mr. Goxx, whose real name was Max, gained prominence in September as a social experiment demonstrating the randomness of the crypto markets. Adjoined to his regular cage, the hamster had a fully equipped office from which he ran his trading firm, Goxx Capital.”
