By Pam Martens and Russ Martens: March 13, 2018
If Wall Street can glam up a story around a stock or a man or both, it can sell the hell out of the shares to the dumb money. If enough dumb money invests, the Dark Pools spring into action and drive the price even higher. That brings in hedge funds. Pretty soon you’re talking about real money. This is how we got the 1929 stock market crash, the Great Depression, the dot.com bust in 2000, the Enron, Worldcom and Tyco flameouts, and whatever we end up calling the bust that lies ahead of the current brainless bubble market.
Take yesterday’s market, for example. Boeing lost 2.91 percent of its value, driving the Dow lower, while Tesla gained 5.61 percent driving the Nasdaq higher.
Boeing turned 100 years old on July 15, 2016. It has a half trillion dollars in back orders. It manufactures the 737, 747, 767, 777 and 787 families of commercial airplanes which represent almost half the world fleet. The company is also a major manufacturer of freighters, reporting that “about 90 percent of the world’s cargo is carried onboard Boeing planes.”
Tesla, the electric car maker, has been around since 2003. It lost almost $2 billion last year and has never delivered an annual profit to shareholders. Somehow, it has managed to achieve a market capitalization of $58.36 billion as of yesterday’s close. (This is not to say that electric cars are not the wave of the future but only to suggest that the survival of a particular technology does not guarantee the survival of a particular company.)
Tesla’s CEO is Elon Musk. He Tweets and says crazy things in a fashion that is undignified for the head of a publicly-traded company. In that respect, he is another symptom of these aberrational times where the man holding the highest office in the land, President Donald Trump, also Tweets and says crazy things that are undignified for the head of a major nation.
Musk, in fact, has been compared to Trump. Marcie Bianco wrote last month for NBC regarding Musk’s rocket venture known as SpaceX. Biano concludes regarding Musk’s desire to colonize Mars:
“The desire to colonize — to have unquestioned, unchallenged and automatic access to something, to any type of body, and to use it at will — is a patriarchal one… It is the same instinctual and cultural force that teaches men that everything — and everyone — in their line of vision is theirs for the taking. You know, just like walking up to a woman and grabbing her by the pu**y. It’s there, so just grab it because you can.”
Bertel Schmitt wrote for Forbes last year about Musk’s stated intention to build a brand new factory and start producing a Model Y small SUV by 2019. Schmitt sums up that fantasy as follows:
“Permit to completion, a single family house can take a year. A new car plant takes anywhere from three to five years from ground breaking to car making. Depending on the location, permitting could add another year. Musk doesn’t even know where that new Gigafactory will be, and he wants it to make cars in two years? It takes a lot of drugs and alcohol to come up with such a plan, preferably with ‘Lucy in the sky with diamonds’ on the turntable, or elsewhere…Anywhere else in the auto industry, if you would announce plans like that, you would be submitted to a drug test, and fired…”
Schmitt’s multiple references to drugs came about as a result of Musk’s Tweet on June 7, 2017 when he wrote: “A little red wine, vintage record, some Ambien…and magic!” (Ambien is considered a sedative-hypnotic.)
Today, Matthew Walther at The Week has crystallized American society’s Pied Piper-like trance under the “messianic huckster.” Walther writes:
“I realize that the founder of Tesla and SpaceX really does make things, like electric cars and spaceships. But Musk’s numerous attempts to realize his gleaming visions of a Jetsons-like future have never come close to living up to the (largely self-manufactured) hype. Lately he has started claiming that he is going to send cargo-laden rocket ships to Mars by the middle of President Trump’s second term, in advance of the establishment of a permanent human colony. I’m not holding my breath.
“Why have we allowed this lunatic a prominent place in our public and commercial life?”
That last question could equally be asked about the sitting President of the United States. The Washington Post has chronicled 2,000 lies the President has told since taking office. On Saturday evening, Trump delivered a rambling speech in Pennsylvania to ostensibly help a fellow Republican win a special election being held today. Trump’s speech was punctuated with remarks that are a humiliation to the office of the President of the United States.
Trump called the host of NBC’s “Meet the Press,” Chuck Todd, “a sleeping son of a bitch.” He said of Congresswoman Maxine Waters of California, an African American: “She’s a low IQ individual. She can’t help it.” Waters is serving her fourteenth term in the U.S. House of Representatives. Before she entered Congress, she served 14 years in the California State Assembly. Trump had never held public office before somehow managing to gain entry to the highest office in the land. His businesses had filed bankruptcy six times.
On Saturday night, Trump also sized up where he thinks he ranks on the presidential dignity scale. He said: “I’m very presidential.”
These are not normal times for America or for the markets. The more we attempt to normalize them to save face, or to relieve our anxiety, the more dangerous the situation becomes. Coming together as a nation to fight back is the only way we can save ourselves from the messianic hucksters.