In today’s Substack Live we looked back at the forces every investor eventually meets: the pull of a hot IPO and the pull of a shiny metal. Here is what is discussed in the live video:
SpaceX went public at a $1.77 trillion valuation, rose above $200 and promptly fell 35%. The median analyst target of $282 implies a $3.5 trillion company. That sits between Microsoft and Google, for a business that lost $2.6 billion last year. There is no P/E and no EBITDA to anchor to, because there are no profits. Even granting a 7x revenue ramp by 2030 and margins the company has never posted, the median target still trades at 152x future earnings. The S&P trades at 22.
The IPO buyer refuses to miss a paper gain. The gold holder refuses to book a paper loss. Same psychology, opposite directions. Both mistake sentiment for fundamentals. We cover this piece by The Private Ledger.
Gold tells the mirror-image story. The bull case is real: central bank buying, debasement, no counterparty risk. The bear case is simpler: it pays you nothing, and “the fundamentals haven’t changed” is exactly what a bag-holder says on the way down.
And because it’s July, our World Cup call: I went with Spain over Argentina. Learning.Investing.Thriving. on the other hand picked Argentina with Messi getting the farewell. Gravity, apparently, does not apply to him.
