Reflections on Investing

Ep65: Tesla's Fountain of Youth Revisited

The P/E for automobile manufacturers is normally very low. Ford, GM and Toyota currently trade at 7 times earnings. Tesla’s P/E of 114 is unique in the auto industry. Elon Musk’s promises of future growth from humanoid robots and robotaxis have sustained Tesla’s high price but investors should be cautious as stock prices built on future growth expectations can drop just as quickly as they rise.

Ep64: Risk

The perception of risk has a major impact on the level of market prices and helps to explain the increase in prices over the last 15 years.

Ep62: Government Debt and Investing

As Herb Stein “if something cannot go on forever, it will stop”. The current growth of government debt is unsustainable. How will it stop? And what does that mean for investors?

Ep61: Stocks and Wealth Creation

A majority of stocks destroy wealth. In fact, most all of the wealth creation from stocks is attributable to only a handful companies.

Ep59: From Earnings to Prices - P/E Multiples

The combination of P/E multiples and earnings determines stock prices – its basic math. In our last episode of Reflections on Investing we looked at earnings, now we add in the role of the multiple.