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Tesla's value is approaching a trillion USD, approximately six times the value of the whole Volkswagen group. You can believe in Tesla or not, but that valuatio

Tesla's value is approaching a trillion USD, approximately six times the value of the whole Volkswagen group. You can believe in Tesla or not, but that valuation is clearly hoping for a future where Tesla dominates multiple industries. I don't see much difference to people investing in any insanely valued coin because they think it's the future of payment.

acdha 5y ago
Tesla's stock is definitely soaring but here's what they have underneath: 1. A very popular electric vehicle business (#1 & 2 best-selling EVs, top 10 across all vehicles) 2. A popular home sold and battery provider (3rd in the U.S.) 3. A large and popular EV charging network 4. A large collection of patents, software, manufacturing capabilities, and contracts for the previous three points Shareholders are still seeing a lot of growth potential but if the market takes a downturn the floor of that value is still quite substantial, especially since the world is turning hard to EVs. Even the bad hypothetical scenarios are something like Toyota buys them at a lower price than shareholders want, not utter disasters. In contrast, here's the sole value behind almost all cryptocurrencies: 1. How much the community thinks someone else will pay for a token The floor is $0.00 because cryptocurrencies are the most distilled form of fiat currency with a very weak backing. Nobody is required to use it and almost everyone has alternatives which are at least as easy and affordable so it's possible to end up in the case where simply nobody is interested buying in your particular set of random hashes at any price, or where the cost of operating the network exceeds that value.
- mxschumacher 5y ago
  car making, EV charging and selling of home batteries are all terrible businesses: Highly competitive and capital intense, unit economics are disheartening (feel free to look into the financial statements of public pure-play companies in these sectors) - for cars you have a century of empirical data. Are Tesla's manufacturing capabilities really superior to Toyota? The latter is making 20x as many cars (2020), makes money while doing so and is worth about a third of Tesla.
  - acdha 5y ago
    Again, I'm not saying they're perfect — only that there's a real business unlike a cryptocurrency. It might not be printing money like Google/Facebook ads but it's highly unlikely that the business could not turn a profit, albeit a tighter one due to competition. Contrast with a cryptocurrency: there's no value other than marketing and nobody needs to use it at all, much less any particular cryptocurrency over an alternative. That puts your floor value at zero: unlike cars, nobody needs random hashes and certainly nobody needs to buy your hashes over equivalent hashes available somewhere else.
    - mxschumacher 5y ago
      Yes, not trying to defend crypto here. Have been watching the space for 6 years and never used a product or service that was built on a blockchain. Cumulative value is hundreds of billions of dollars. I wonder whether I'll wake up in a few years thinking how could I be so blind to all this awesome innovation or whether the hype dies down. Quick note on Tesla: I'm not saying they cannot make money, just that the current trillion dollar market cap is absolutely astronomical given the business performance.
- legulere 5y ago
  You are right that Tesla has some inherent value to fall back to but cryptocurrencies do not. But still Tesla is probably valued several times too high. Tesla has almost three times the market cap of Toyota right now.
  - acdha 5y ago
    Yes, it's definitely possible for a stock to be overvalued. If you note my comment explicitly acknowledged this with the possibility that bad news could force a sale at well under the current price: the point was that there are very few possibilities where that value wouldn't still be a very large amount of money because there's a real business backing it and it's unlikely that the situation is going to change in a way which would cause all of their customers to disappear.
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oldgradstudent 5y ago
> You can believe in Tesla or not, That's an apt way of saying that, as Tesla is the first publicly traded cult.

acdha 5y ago

Tesla's stock is definitely soaring but here's what they have underneath: 1. A very popular electric vehicle business (#1 & 2 best-selling EVs, top 10 across all vehicles) 2. A popular home sold and battery provider (3rd in the U.S.) 3. A large and popular EV charging network 4. A large collection of patents, software, manufacturing capabilities, and contracts for the previous three points Shareholders are still seeing a lot of growth potential but if the market takes a downturn the floor of that value is still quite substantial, especially since the world is turning hard to EVs. Even the bad hypothetical scenarios are something like Toyota buys them at a lower price than shareholders want, not utter disasters. In contrast, here's the sole value behind almost all cryptocurrencies: 1. How much the community thinks someone else will pay for a token The floor is $0.00 because cryptocurrencies are the most distilled form of fiat currency with a very weak backing. Nobody is required to use it and almost everyone has alternatives which are at least as easy and affordable so it's possible to end up in the case where simply nobody is interested buying in your particular set of random hashes at any price, or where the cost of operating the network exceeds that value.

mxschumacher 5y ago
car making, EV charging and selling of home batteries are all terrible businesses: Highly competitive and capital intense, unit economics are disheartening (feel free to look into the financial statements of public pure-play companies in these sectors) - for cars you have a century of empirical data. Are Tesla's manufacturing capabilities really superior to Toyota? The latter is making 20x as many cars (2020), makes money while doing so and is worth about a third of Tesla.
- acdha 5y ago
  Again, I'm not saying they're perfect — only that there's a real business unlike a cryptocurrency. It might not be printing money like Google/Facebook ads but it's highly unlikely that the business could not turn a profit, albeit a tighter one due to competition. Contrast with a cryptocurrency: there's no value other than marketing and nobody needs to use it at all, much less any particular cryptocurrency over an alternative. That puts your floor value at zero: unlike cars, nobody needs random hashes and certainly nobody needs to buy your hashes over equivalent hashes available somewhere else.
  - mxschumacher 5y ago
    Yes, not trying to defend crypto here. Have been watching the space for 6 years and never used a product or service that was built on a blockchain. Cumulative value is hundreds of billions of dollars. I wonder whether I'll wake up in a few years thinking how could I be so blind to all this awesome innovation or whether the hype dies down. Quick note on Tesla: I'm not saying they cannot make money, just that the current trillion dollar market cap is absolutely astronomical given the business performance.
legulere 5y ago
You are right that Tesla has some inherent value to fall back to but cryptocurrencies do not. But still Tesla is probably valued several times too high. Tesla has almost three times the market cap of Toyota right now.
- acdha 5y ago
  Yes, it's definitely possible for a stock to be overvalued. If you note my comment explicitly acknowledged this with the possibility that bad news could force a sale at well under the current price: the point was that there are very few possibilities where that value wouldn't still be a very large amount of money because there's a real business backing it and it's unlikely that the situation is going to change in a way which would cause all of their customers to disappear.

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oldgradstudent 5y ago

> You can believe in Tesla or not, That's an apt way of saying that, as Tesla is the first publicly traded cult.