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Let’s Talk Markets Live: George and Dennis 3/21/25
Recorded: March 21, 2025 Duration: 1:00:33Space Recording
Short Summary
In a recent discussion, key industry players announced significant partnerships and project launches, while addressing emerging trends in regulatory changes and economic challenges. The conversation highlighted the potential for growth amidst concerns of decline in job security and innovation leadership, emphasizing the need for strategic adaptation in the evolving crypto landscape.
Full Transcription
We are live.
Let's Talk Markets live on this beautiful March 21st.
I don't know how it is by you guys,
but the weather has just been spectacular.
Up here for the two days this week I've been here.
I was in DC Monday through Wednesday,
where the weather was even nicer.
But not going to say what the climate was, but the weather there was quite
nice. So, you know, it's, I'm excited to jump back on with George and Dennis and to
talk markets on Let's Talk Markets, but I do want to start out the show by announcing
a very exciting milestone that Irvin has just reached, where we have yesterday announced our first public company
client joined our platform in order to connect with their investors. Their name is Monogram
Technologies, MGRM. I don't know if you guys are familiar with them. Pretty cool story stock,
amongst other things. One of the largest crowdfunding offerings that there were, tens of thousands
of directly registered individual investors, and really compelling technology. I'm not here to sell
it. I'm just excited that they really want to connect with their investors, and they joined
Ervin to do so. and so it's been a
real great success so far in just a couple of days so it's a real milestone for us. Dennis, I think
you've hit a milestone this week too. So yeah, I want to talk about that. Well first, congratulations
Dave. I mean, I've known Dave for probably almost 15 years here now. We've run through market
structure conversations for years. We've been good friends, obviously,
for a very long time. So I love it when you know, you you have
success, you know, we don't know if we have success yet. But we
just launched a new network at stock trader network.com, where
we've got, you know, we're trying to build a community of
short term traders and long term investors to come in, talk their
ideas, chat amongst
ourselves.
Obviously, we've always had a good community for pre-market prep, our regular show that
we still do eight to nine every day.
You can watch that on StockTrader Network as well.
And then if you want to expand further, we've got a 24-7 chat, we've got educational resources.
We're trying to be the one-stop shop for the trader here.
It's taking some time to build it up though. You know, we've been working on it for a long time.
My voice might sound a little bit hoarse
because I talked for eight hours straight yesterday
and I'm not used to that.
So I was joking with George and Dave.
We got to get you guys over on the Stock Trader Network.
Get my voice arrest here for a few minutes there.
So yeah, that's my story.
So stocktradernetwork.com.
So try new things.
Yeah, that's what else is there, right?
You always got to try something new.
So yeah, George Dennis, thanks for joining us.
Pretty excited to talk with you guys.
It's been, you know, it's been what, two months, I think.
And I don't know, has much happened
in the last two months.
No, nothing.
You know, nothing, right?
Uninteresting.
Totally uninteresting. Yeah, and. Nothing, right? Uninteresting. Quiet. Totally uninteresting.
Yeah, and I was telling the guys earlier,
I was actually in DC this week meeting with the SEC.
So we, the investors, last week petitioned the SEC
for rulemaking on RegShow, the regulation that
governs short selling.
And we're pushing to close all of the loopholes
in that regulation, including the Madoff exemption for market makers, the problem of continuous
and persistent failures to deliver where we're arguing for escalating fines for
FTDs and getting rid of basically the subjectivity of rake show and the same
thing is actually happening up here in Canada
There's an effort to do similar rules around reg show and we're going to be pushing
To get rid of any subjectivity on those rules as well. So in reg show
You know you you have to locate stock before you sell it short and you have to have what's called reasonable grounds
And if you want to have an exception to that rule,
you have to be what's called a bona fide market maker.
And those two terms mean nothing.
Reasonable grounds means nothing.
Bonafide means nothing.
These are completely subjective terms.
That's why the regulation is unenforceable.
And that's why we are pushing to change it
to something objective and enforceable.
So had some time in DC and had some very encouraging meetings down there.
But then I'm really happy to get back to Canada, a civilized country that doesn't make trouble
with our neighbors.
Oh, no.
Yes, not at all.
We don't take advantage of the US with our trade surplus.
I mean, that probably leads us into this discussion.
I mean, you know, jokingly, not much has happened.
A lot has happened, obviously.
Fifty first state talk over here, Dave.
So you you move away from the US, you might become an American again by by by.
Sled the country and here they are, come in trying to take me back.
It's your fault.
They don't want you to leave.
They want Dave Lauer.
They need Dave Lauer and they're going to
take over the whole country to get him.
Just to get me back.
Yeah. That's not cool.
It's not cool.
I don't know what's going on.
Honestly, this whole thing is so crazy to me.
I had the funniest conversations in DC.
I got to tell you, and I was talking to someone and no one was in favor of it. Everyone thinks
it's absurd. And he was like, how do you pick on Canada? And I was telling him, I was like,
Canadians are angry now. Like they're angry. You've made the nicest people in the world angry.
Do you know how hard that is?
Like this is like, I've never,
I can't even tell you, I'm from Jersey
and I've never apologized so much
as when you live in Canada.
Everyone's apologizing all the time for everything.
Not your fault, their fault, doesn't matter.
Constant apologies.
It's like the nicest, most polite place.
And now all of a sudden they're angry, right?
Dennis, are you angry?
Yeah.
Yeah, you back us into the corner
and we start throwing our maple syrup at you.
That's what happens here.
It's gonna get real sticky, guys.
I mean, my wife is petrified.
My wife is worried about an imminent invasion happening.
I was like, I don't think we're gonna have
an imminent invasion, but this economic war
is a little bit scary, obviously.
So, I mean, lots of people obviously talking in our area about Trump and I come from Windsor,
Ontario originally, so I have lots of friends back in Windsor.
I would say Windsor is like ground zero for this stuff because of the automotive.
Like 90% of the Windsor economy is automotive big three related.
So people are very worried about their jobs down there.
They've had jobs forever.
Like people are working 30, 40 years,
35 years at these plants and they're worried
that they may lose their jobs.
So I mean, that's the other side of it.
And I get where Trump is coming from to a certain extent.
You want more things made in the US.
You obviously want jobs more in the US.
The one issue that, you know, I think the markets have
is that I wonder if he's just trying to do everything
too fast and too harshly, like coming in,
pulling a China shot, I'm gonna make change,
I'm gonna rip this apart, rip this apart,
rip the government apart, I'm gonna get you all rid
of all these trade deficits around the world.
He's doing so much so fast that I don't even think the market knows what to do
with that, especially the U.S. markets.
And that's why I think, you know, they've obviously been going down over the course
of, you know, the last month or so.
Yeah.
What do you think, George?
Yeah.
I mean, I think that the major problem here is that this is
probably like the worst time post World War Two to be, you know, taking on this
kind of, I would say, let's call it a global acrimony. And like, it kind of
reminds me of, you know,
I play this very intense strategy game, Europa Universalist.
And if you take too much territory, all the people around you
form a coalition against you and you lose like these coalitions
mean you lose. And that kind of reminds me of what's going on
right now, where it's just like, I feel like this would be going a lot better if the enemies
might have been waterfalls a little bit and picking some
battles at a time.
And where I started the worst time since World War II is you
look at our market being down.
I looked at this earlier in the know, our market being down, I looked at this like earlier in the week, our
market being down about 6% and China's market being up 26%, right? And I think the horrible
timing of this is it seems to be coming at an inflection point where what I would always say
is be like, yeah, the US has a lot of problems, but I think they're the best at innovation.
And I think we might have with deep seek,
I think we might have passed an inflection point where the US
might no longer be the best at innovation.
And it's not just deep seek. It's that, you know,
probably like Alibaba, you know, Baidu, they, they, they both have like models that are like, you know, probably like Alibaba, you know, Baidu, they both have like models that are like, you know, at least comparable or coming out there.
And we'll get into electric vehicles in a bit, but the BYD announcement of the battery that can charge in five minutes.
I mean, incredible, incredible advances, right?
Yeah, but it's just like I look at that and I say, okay, we really got two problems, right?
It's that I think we're taking on too many enemies all at once.
And then we also have the situation where there's a legitimate argument that these
Chinese companies might be better to put their dollars in.
So I think that's the major thing our markets are struggling with,
where it's just like, I think a lot of people in Europe would love to move their money elsewhere to China, wherever,
just based on what's going on in our country.
But the fact that there seems to be some legitimate reasons for it,
I think that's a major problem for us right now.
Yeah, you know, I got to say that there's a surprising amount of things that Trump says
that I find myself agreeing with.
And a lot of it is related to, you know, like I have a very traditional economics education,
and that's like sort of this Keynesian type of globalist education that I have, that has
sort of come crumbling down in the past, I don't know, 10 years.
That I think the economic consensus from 30 years ago is dramatically wrong and has been proven dramatically wrong.
And it's on all of that stuff that I kind of tend to agree with Trump, that these global trade imbalances actually
are a problem in some places and in some ways.
And this idea that you can stop making stuff as a country
is terrible.
That's a terrible thing that we did to our country
over the course of 30 years, and that we
need to correct it and fix it.
That said, I'm very much in agreement with you, George,
that this is a terrible time to be taking
a wrecking ball to the global geopolitical order,
given where China is at.
So far, we are two full months into this thing.
I don't think you could have done more to
help China than what they have done in terms of foreign policy, in terms of the way you've treated
your allies. Like there is a lot to be said for building this massive block of alliances, both militarily and economically, across the globe to confront what is going to be
and what has become a second major superpower. We are out of this unipolar world. We're
back into a multipolar world, which I think is actually probably a good thing. But at the same
time, we need to be bringing our friends closer and making sure that we're all sort of unified against
the, you know, these forces that are going to be coming at us in every way economically,
technologically, politically, militarily, you know, and I think that this is just crazy to me,
the way that they have approached things
with Canada and Mexico, with Europe compared to,
if just look at like tariff rates on Canada versus on China,
it was crazy at first that they were so unbalanced,
so much more against Canada than China.
And even now where it's close to even,
that just doesn't make any sense to me,
especially when you consider that the trade
deficit to Canada is basically because Canada sells the U.S. oil at a discount, right? That's
like the entire deficit is discounted oil. More, more. Dave, it's more than the entire deficit,
because yeah, it is, because I was reading a TD paper there and the entire deficit, if you take oil out,
US actually has a trade surplus with Canada.
Crazy.
That's the absurdity of it all.
They actually have a certain, and we know it,
we buy so many US products, you know,
like we don't produce that much in Canada.
The stuff we produce in Canada for the most part
is stuff that's going back and shipping back to the US
to continue to be in production.
So if you take out the oil and they have the discounted tariffs on that only at 10%, if
you take out oil, the US has a trade surplus with Canada.
That's crazy in itself to think, you know, so this subsidy, subsidizing the entire nation
of Canada is just untrue.
I mean, we're selling cheap oil to you.
I know. I was talking to this guy,
I was talking to the guy like mega as they come, super great guy.
We were having this really interesting conversation about all these issues.
He's like, what has Canada ever done for us?
We provide, basically he's saying the nuclear umbrella.
We provide strategic defense and deterrence for Canada.
What have they ever done? I was like,
they sell you oil at a discount,
like at a huge discount,
like that's a big deal.
He's like, oh, yeah, I guess so.
I guess that's it.
There's such a strong relationship there,
and it's so mutually beneficial.
That's what it is.
It really boggles the mind where this,
what is the preferred outcome here,
especially given that all of this is happening
under the trade agreement that he negotiated
in the first term.
Yeah, that's a good point too.
That really I look at is that I agree with you from
the perspective of like what has become of our like, you know,
globalized economy, right?
Doing something about that is smart.
And then you, I also think that like one of the things that I
did like about Trump's first administration was I did think
he had a better approach to China than the people before him.
That being said, my biggest problem with the tariffs is not that they're tariffs. The problem
is that we're not doing anything to stimulate manufacturing in this country. It's like we don't
have capacity to replace whatever is getting
tariffed generally.
And that's the big problem.
There's little areas where you're just like, okay, maybe cars.
It would help.
But that's one of the few things we have manufacturing.
But if you look at that, it's because we bailed out those
car companies, not because those car companies are really all
that viable and they still have those heavy, you know, pension things. So it's just like,
what I would have loved to see is for them to come in,
offer subsidies to build manufacturing in the country and maybe a year out,
then do the tariffs or at least start, you know,
attaching some subsidies now or some incentives or things like that.
But that is my big problem with the tariffs, not just that they're tariffs,
that it's just like, okay, we're going to throw up tariffs.
It's just like, well, if you don't have any manufacturing,
tariffs don't actually help you or you don't have very little manufacturing infrastructure.
And to your point, that's largely left this country.
Right. Totally agree. And think like just from a numbers perspective,
you know, how much of a dent can Canada make in U.S. employment?
Canada is 10% the size of the U.S. It just can't take that many jobs versus China.
many jobs versus China. And like the dramatically low cost manufacturing in other countries,
it's not Canada that's coming in with like these crazy underpriced manufacturing.
No, and you know, the skirting environmental regulations and all that. Like that's,
it's just wild to me. I think there's the underlying thing though,
it goes back to the 51st state.
Like I think there's a little bit of Trump mentality
is conquest, you know, like the first thing he's doing
is renaming the Gulf of Mexico, Gulf of America.
We're gonna go up to Greenland,
Denmark doesn't have the rights to that.
You know, he's talking about the Gaza Strip,
talking about the Panama Canal.
There's this, you know, underlying conquest theme.
And I think he loves the idea of saying, Hey, we take all, you know, with 51st
state, Canada becoming an all of North America is just the United States of America.
He loves that idea of it.
So, I mean, he likes his name on it, right?
Kind of.
Yeah.
He likes his name on shit.
You're right.
Trump hotels, Trump airlines, Trump casinos. He likes his name on shit. You're right, Trump hotels, Trump airlines, Trump casinos.
He likes his name on stuff.
If he could, he'd rename it United States of Trump,
if he could.
I mean, what?
I mean, Greenland could be Trump land.
Trump land, that sounds pretty good.
You know, it's like some desolate tundra.
No, you know, it's funny enough,
I like the idea of taking Greenland.
I think that's a good idea to me.
But I think you're going to handle it
better to make it actually plausible,
not make us big public stink about it,
just go to Denmark and be like,
let's talk, what do you want?
What can we do here?
We buy Greenland from you as opposed to
we're just going to go over and take it from
you?
Right.
Again, they're a staunch ally.
You treat them that way.
They've never done any.
What's Denmark ever done?
They gave us delicious baked goods.
What else?
Sorry, I didn't even know.
Is it Danish?
That's the biggest question about all of this.
I find myself wondering it all the time because as I'm talking about this economic policy, it's like when I learned economics or when I, you know, I feel like this was much more of a thing.
You know, you had a policy, right? And then you put some like projections around it, right? Where it's just like, okay, we're making these tariffs, but we think by, you know, 2027, like this is how we'll benefit.
And this is the extent that will benefit.
I haven't seen any economic strategy around this.
I just see, you know, talk of them working eventually.
Right. Which is not how economics works.
And it just like makes me wonder.
It's like, it's like, OK, like, I do understand that maybe it will work.
Maybe we'll get Greenland or Canada or whatever.
But it's just like, I just have a hard time distinguishing between, you know, what is, you know, real policy and what is just like tactics to, you know, ends that we don't really know.
Right? Yeah. And I think that that's that's the tough part.
You know, you look at, you know, some of the stuff like the US voting
with Russia in the UN Security Council and the way that that, you know,
that is really affecting some of these relationships in Europe.
And that's another thing where I'm just like, OK, is there like, is there a strategy here?
Like, if so, like, what is it?
Does anybody know? Like, does his cabinet know?
Is this just something that he feels strongly about?
Like, that makes it when you don't know if it's like policy or if it's tactics.
It's very hard, you know, as someone that's trying to predict
the markets to understand.
I think that's what we saw with the tariffs where they're there, they're back, they're
there.
It's just like, okay, how do I factor this in?
Because if it's just like, okay, here are the tactics or sorry, here's the like plan
around what's going on.
And this is what we expect. It's much easier to be like,
okay, I can plan around this.
That's right.
And maybe you'd have more support
if there was some strategy that was put out there.
And hey, talking about economic projections and uncertainty,
the Fed met this week.
They kept interest rates where they're at,
which is probably different from the outcome
that the meeting would have had, let's say, a few months ago, where far more cuts seemed
to be on the table.
And they put out their summary of economic projections.
And there's a pretty big shift from pre-election forecasts.
There's high uncertainty and unbalanced risks.
That's how Claudia Assam put it on Blue Sky. And she
said nearly all Fed officials say uncertainty is higher than normal in the past 20 years.
Risks are that GDP is down, unemployment is up, inflation is up. It really, it feels like
all of the pieces are in place for stagflation. And that is probably, from an economics perspective,
one of the scariest potential outcomes here, right? That a lot of these policies and all
this uncertainty are creating conditions that are both contractionary from a GDP perspective, as well as inflationary from a price perspective,
both tariffs and immigration policy are both things that are extremely inflationary.
And then the uncertainty and the tariffs also mix in to reduce demand or pull forward demand.
So far, what I've actually been surprised at is some of the economic numbers we're
seeing are like manufacturing and such are still holding up to a certain extent.
And I think a lot of that is actually just pull forward.
And it feels like the next two quarters,
second and third quarter are going to be much uglier than what we're seeing this quarter.
I think the market's telling you that. The market's selling off, especially when it's
limited, when it's very much US-centric to the sell-off. It's telling you, you know,
the market for one is uncertain. We've been talking, it's not only when you see the markets
going like this and you see, you know, uncertainty in the political front, the consumer sees this too.
The consumer's not stupid.
And I think what we're seeing,
even with recent numbers,
looking at some recent retailers that reported,
Nike reporting last night, FedEx reporting last night.
Yeah, the consumer is cautious here.
It's a cautious consumer.
So it's not a consumer that's out of money.
It's not a consumer that's broke,
but it's a consumer that is uncertain of money. It's not a consumer that's broke, but it's a consumer that is uncertain
of the economic environment that they're going into
and they're saving their pennies here for a rainy day.
It's why the airlines and the cruise lines
are starting to sell off here now too.
Cause people are looking,
oh, I'm gonna go book this trip.
I'm like, well, I don't know,
because I don't know just what you said, Dave.
I don't know that the next two quarters is gonna look like.
I don't know what the next year is going to look like.
I just want to save a little bit of money right now, just in case.
So that is showing up in the economic, not so much in the economic data yet, but
it's showing up in the quarterly earnings here.
And that eventually is going to start showing up in the economic data as well.
So I'm with you, the uncertainty here, you know, going forward from, you know,
we could call it, you know, maybe, maybe it's from Trump, maybe it's from, you
know, policy, but it also was kind's from Trump, maybe it's from policy,
but it also was kind of a perfect storm
because we kind of started the year
where everybody was rah rah, growth stocks,
spending like crazy on AI.
You know, this is gonna be,
and everybody's excited about the possibility
of a huge expansion in 2025, technological expansion.
And now all of a sudden, just suddenly, a little bit of a rug pull here.
And that's made the consumer cautious.
It's made the investor cautious.
And that's why we've had a sell off in the S&P of 7% of the NASDAQ 13% because
the investor and the consumer are both cautious here.
Yeah.
I think, I think it's a very interesting time in terms of, oh god, I'll be right back.
This thing has been happening with my camera. And he's gone. All right, well, we'll wait
for George. Yeah, I think we're gonna lose George. He'll be back. Some technical issues.
Okay, we lost George. That's okay.
I'm still here.
It happens on live, you know, whatever this is, not TV.
Yeah, for sure.
So anyways, just going back, you know,
I think what George was saying too, you know,
when he started, you know,
and again, just bringing it back to this,
US markets down 7% this year, but China up, you know,
some 22% after today, it's sold off a little
bit.
I mean, there isn't a lot of times where you see markets, and this is year to date, where
you see markets so strong in one pocket in Asia and so weak over here.
Usually, we go look at the global financial crisis and look at at all that. And obviously, you know, the markets kind of
tend to move together.
We're kind of like a world economy
where we all kind of tend to have recessions,
dips together, troughs together, expansions together.
I mean, that is not what we were seeing, George.
I was just, you know, why we lost you there.
I was just kind of expanding on what you were saying
about China being up 22% right now,
and the US being down 7% year to date,
and just saying, this
is not normal for markets to do this.
It's not normal to see such strength in Europe and such strength in Asia and such weakness
in North America.
I mean, it's actually quite surprising.
And I think it's twofold.
I think one is international valuations are somewhat cheaper than the US.
So if you get to a point where people start caring about valuation,
Asian markets are pretty cheap.
You know, a lot of China stocks are 10, 12 times earnings.
European markets are a little bit cheaper.
US markets, you know, at 22, 23 times earnings are a little bit expensive.
But then also the cautiousness of the international investor is saying, well,
I don't know the uncertainty in the US political situation, so maybe I'm just going to
invest a little bit elsewhere.
So maybe pulling some money out of the U S and putting money elsewhere.
That's probably been the contributor to why we've seen such a strong first
three months out of China.
Yeah.
I mean, I think those dollars are leaving in what I, what I was going to say is
that, you know, tracking the options data through this,
I think we saw on February 9th, a very interesting thing
where we actually thought there was a bug in our code
because we couldn't generate metrics
for some of our upside downside thing
that are expirations generally longer than nine months.
And we had basically, I think it was something like 15% or like 16, like 60 names of our large cap stocks just fell off,
no longer had expirations longer than nine months. And I had never seen that. So that was my first sign on February 9th
that something was up.
Then by the time we wrote like our art,
like we wrote a newsletter about us being bearish
for the first time in a while on the 19th.
And that was because our spine adoption sentiment
was at zero and it's still at zero.
And that's the thing that I've never seen, you know, and I wanted to give both
of those events of the lack of, you know, first, you know,
institutions, I think being concerned enough to stop issuing
long term options either way, is very interesting. And I think
what I think is they knew the tariffs were coming, right. And
they said, you know, I think they were just like,
we don't know exactly what's gonna happen,
but we don't wanna take on any risk, right?
And then with spine and options sentiment being at zero,
like I've seen it like for other, like bear periods,
I've seen it like sit there for a little bit,
but then come back, but we're going at a month
of it just being fixed on zero.
And the only way for me to interpret that is people expect it to go down a lot further.
I do think what we're seeing is some aggressive swing trading in institutions,
because I think the markets have fundamentally changed.
There's still a lot of retail money in there.
And what I've found in talking to some institutions, that is that
that's a pretty easy trade for them. If they see basically a certain
amount of optimism in retail traders and certain names that they do,
it's easy for them to kind of write them up and push them down again.
So I expect to see that kind of behavior. But yeah, I think we're in a time like, we were talking about consumer
confidence. And I think that that is, you know, important.
But I think institutional confidence being low is one of
the things that's driving the low consumer confidence. And I
don't see that changing anytime soon.
Yeah, I mean, I think if you're an institution here and you've been sitting on some pretty incredible gains, right, coming into this year, right, especially following November, the Trump trade, this massive rally.
And it's been quite a while since we've seen anything that looks like a correction.
And now it's like a perfect storm of problems coming together.
And we're seeing the results of that.
And you're seeing it really intensely
in obviously like some of the biggest stocks
and the biggest gainers.
So I think that's the perfect time to segue
to our favorite stock to talk about, Tesla.
And Dennis, I'll give you the chance,
I'll admit I haven't been following your comments on it.
So the last time we spoke in January,
you were a huge fan.
I was.
Major investor.
And obviously we've seen it get cut in half at this point.
I was pretty proud of my Tesla puts as some of my friends have gotten sick of hearing
about but I emailed George last week and I asked him about his, you know, what's the
options market telling him on it and I ended up closing the trade.
And that was a pretty nice trade, I gotta say.
But so Dennis, where are you at with Tesla?
So interesting enough.
And I had an inflection point
well before Dan Ives had his three days ago.
And so I had Tesla at one point in time.
Thanks, I like that.
And well before, you know, last year,
if you were listening to me in 2024,
I was rah rah, Elon Musk, rah rah, Tesla.
You know, when Trump got elected,
I was like, this is just the best thing for Trump,
for Tesla, you know, it's gonna be, you know,
easier regulation to get FSD through and everything.
But what started changing was, you know,
when he's bringing chainsaws
into the White House, cutting government jobs and Nazi symbols over in Germany. And I'm
like, Holy cow. So on pre-market prep, which is my daily morning show, I try to find the
date of it because I tweeted it that day. So I was just looking through my old tweets
and there's quite a few of them there. I think it was like late January that
I said, you know, look, I love the long term prospects of Tesla. I think they're working
on the real AI stuff, the really cool stuff that you know, everybody was going to eventually
want to have, you know, full self driving cars, humanoids taking out her garbage and
walking her dog and doing her dishes and vacuuming
her homes.
I love all that aspect of it.
But the issue was I'm like, I've never seen the hate towards, you know, somebody turned
so quickly like this Elon Musk.
It is like pockets of hate, like people absolutely hating it started, you know, really at the
beginning of January.
And I looked at it for a bit. and then the European sales numbers started coming out.
I was like, this is a red flag, man down 58% year over year.
And the Tesla bulls are on there talking about, oh, well, it's model refresh.
You know, the Y's not out.
They're just not buying.
That was an excuse because the obvious trade was telling us very clearly
that the customer was pissed off at the CEO.
And I've never seen, you know, such a politically one-sided CEO before.
CEOs, when you run a public company, and this is going to be, go down in history books as
a lesson, they try to stay relatively neutral because let's be honest, 51% Republican, 49% Democrat,
you can't cut off half of your customer base.
So you can't go actively and piss off half of your customer base.
And that's kind of what he did.
He's pissed off all the Dems.
But then it went further to his tweet that Canada is not a real country, to his tweets
all the time.
So he's just pissed off so many people.
That those people are-
Like you were talking about Germany
and the Berlin Gigafactory and then his intervention
or attempt to intervention in the German elections.
I mean, it's like, it's just wild.
Total, it feels like a total disregard for his company
in terms of like his public stances
and how energetically he has been doing this.
In a surprising way, I mean, like Tesla is such a fundamental part of his wealth and his what I
know it's his legacy. Right. Exactly. It's his baby. So it was really, I know about when I said it
because it was $390 that day, the stock was 390. And I came on pre-market prep and I said, I know I've
been bullish Tesla for a long time, but I'm like, I have to sell the majority of my position
here because I don't know how much brand damage he's doing. That was what my whole thing was,
you know, and he can go back and I think it was, I'm thinking it was actually the first
week of February.
Yeah. And I'm like, you know what?
I think it was right around the same time. I was, I was looking at the exact same thing. I saw the same, those European numbers were eye-opening to me. Yeah. And I'm like, you know what? I think it was right around the same time. I was looking at the exact same thing. I saw the same,
those European numbers were eye-opening to me. God.
And really said, there is something here that is going to hit Tesla's fundamentals. And there's a,
you know, for me, that was a trade to be had. But yeah.
And I was still longing at that time. So when you were identifying, you know, getting ready to get
short, I'm like, I need to like not be have this 10%
of my long-term portfolio.
So I sold 95% of my position.
It was over a double for me.
I had averaged at 190 and I sold some at 410.
I sold some at 390.
I sold some at 355, you know, and then I was all out.
Well, it's actually not true.
I kept a small legacy position that I still have an account.
So I have about 5% of my original position, which I just like, you know, I'm forever playing
with the house's money and what if I'm wrong?
And you know, eventually goes back up.
So like I put it in my RSP retirement account, like never going to look at it again type
deal.
But I'll tell you, like the brand, I cannot believe, I can't think of a situation where a CEO has killed, has basically done that much
brand damage in such a short period of time.
For years, Tesla didn't even have to advertise
because their cars were a walking advertise.
Everybody loved their cars.
They would just talk about them.
So they didn't even need to advertise.
They didn't have showrooms.
I mean, this is how they made so much money, so much margin, so much better than the other auto companies
because they didn't have to spend a lot of traditional stuff because everybody was just
hardcore believers. Built that brand for seven, eight years there. That's all in like six
weeks. Just destroying his brand. And I've never seen that before. And that's why I think
at this point in time people are asking,, you're gonna rebuy your Tesla,
rebuy your Tesla.
And I'm like, I'll day trade Tesla.
But at this point in time, I can't go back all in
because I don't know how much of this brand damage
is sticky.
I don't know if it's permanent.
Some of it could be permanent.
And that's a serious problem.
So that's where I'm at in Tesla
is that I just can't bring myself to get back in
even though I like the long-term prospects, there's been a lot of brand damage here.
And that's going to take time to heal if it ever does.
What do you think, George? What are the options market saying right now?
Yeah, I like there. It's a little. It's very soft for Tesla.
I mean, Tesla typically has one of the best net option sentiments.
And actually, like people seem to still like it long term.
I mean, it's looking pretty good. And I mean, I do think it could be due for a rebound here.
But I mean, I completely agree with what you both are saying. I got out of my last position. Well,
I have one open in my larger portfolio, but I got out of my last one in my high conviction portfolio at 340, too, I think.
But I think this is just not just for the markets, one of the most fascinating things that I can remember in history.
And I can remember going through this live. And when I first started to talk about the alignment with Trump,
I said, you know, pretty much what Dennis said,
which is like, I've never seen someone align so strongly with one party.
And where it started to slip for me, I would say the first red flag was,
you know, even as I was starting to say,
holy shit, this might pay off for him.
He's aligning with Trump. He's going to have a big role.
I'm sure he's going to get things
in this administration for it.
But the first thing is I remember
I was listening to a space.
And I remember hearing Trump talk about how
it was important, very specifically,
I think, wanted to put him on the spot about oil
being necessary and needing to stimulate
the economy in that way.
And he got on and said, you know, one of the more shocking things I've ever said,
because this is the guy that's like, has such little faith with climate change
that everyone needs to buy cars.
And by the way, we need to go to space because it might be too late for us.
And I heard the same guy.
We need to be a multi-planetary species.
How many times have you said that, right?
Yeah.
Probably true. the same need to be a multi planetary species. How many times has he said that? Right? Yeah. Probably. I heard the same guy. Sure. We had to balance short term economic concerns with
the climate like around oil. And I was like, holy shit. And that was the first thing where
I'm just like, you know, maybe this guy doesn't have a plan. Um, but you know, as it started
happening and I kind of tilted the other way.
And then it's like there's the fine line between genius and insanity.
And looking back and saying like, that ex acquisition was smart to help him align with Trump and
kind of buddy up to him and all of it.
And now I'm looking at all of it like very differently. As I saw someone last night buying a million dollars
worth of, I think they're 175 or 180 puts,
expiring April 17th.
And I'm just like, and also like putting all of this
in perspective, I've heard that like at $100 a share for Tesla,
X is at risk of being grabbed by the banks that have financed
and the people that put it up.
And I'm just like, wow, this is actually in range of blowing up.
And like the thing, you know, like I think in February,
so Chinese sales were down 49% and BYD up 161.
And the number for Germany was 74% down, I think, for February.
And the shocking thing where I'm just like, wow, this might all really like blow up is 94% of Germans said they would never buy a Tesla.
Yeah.
And I'm just thinking about it's like, it's unprecedented to piss off 94% of a country.
That's impressive.
I think even Hitler at the end had a higher approval rating.
And no, I bet you would find the same if you polled Canada.
I bet you'd find the same if you polled a bunch of countries.
They're throwing bricks through the windshield.
Yeah.
I talked to my neighbor and he doesn't even
have a problem with Musk.
And I was like, would you buy a Tesla?
He's like, no, I don't want to brick through my windshield.
I'm like, there's a fear of owning the cars right now.
Yeah, and it doesn't even matter your politics.
You might think that Musk is a genius
and you're as big of a Trump fan as you can be.
It's just like, as I think you're both saying,
it just doesn't make sense as a CEO to do that
to your company and to destroy shareholder value like that.
Like there's, objectively, right?
It's like, I think what like is clear now, right?
Even as you're like coming into January,
he's got this big position, everything,
you could be like, wow, he orchestrated this perfectly. You could easily make that argument.
Yes. It's all at like, it's getting to a point where like the board, a lot of them have sold shares, even his brother. So a lot of shares. Yeah. Like it's looking like he might like at least it's a conversation get removed, right?
Because it's possible love them as an AI company like one of the risks and one of the ways I'm like, you know, game theory.
It is it's just like one of my reservations and I love full self-driving long term.
But one of my reservations about it was like, I think there might be more accidents in Tesla's because quite frankly, the hardware isn't as comprehensive as like Waymo's, for example. That's a much, some might call it overkill, but it's not
overkill if you don't want to kill any people.
For the age that the technology is at right now, it is very much not overkill and you're
still seeing reports of how the FSD disengages at the last minute when there's going to be a problem
which juices its safety record. I don't know if you saw like the
cyber truck recalls. Well the side panel's falling off. That's not an FSD issue, but it is a
mass manufacturing issue and it goes to the heart of this issue which is it is
really hard to mass manufacture cars just as a general issue that's a really difficult thing to do and to do it safely to
make safe cars it's something that even like the biggest car manufacturers in the world still
struggle with and you know the the you you definitely see that you have Tesla here
pushing a technology that is not quite ready for prime time.
People are using it.
The regulator has been all over them for a long time,
but now, like what's NHTSA gonna do, right?
Against an Elon Musk company.
It's very concerning.
You're seeing like contracts go to Elon Musk companies
and people see that, right?
Like this isn't something that I think
the general public isn't aware of.
I think people see it and they understand it.
And a lot of people don't like that kind of thing.
Well, Trump, you know, as you know, said yesterday
that if you do damage to a Tesla car,
you can get 20 years in prison.
Yeah, he wants to prosecute people as terrorists.
Yeah, terrorists for throwing a brick
through a Tesla windshield.
You're terrorists, 20 years in prison.
I mean, what country are we in?
I mean, you see a lot of the things going on
with the supposed paragons of free speech,
deporting people because of speech.
And there's a lot disturbing.
And this isn't a political show, no need to get into it.
I don't care what you believe or what side you're on,
but it has an impact on markets, right?
Like that's the point,
is that seeing the impact of all of these policies,
even if you think that it's a policy
that doesn't impact the stock market, it does.
When you start detaining people from Canada
or the UK or Germany,
when they come into your country on a
valid visa and suddenly these countries I think the UK and Germany both issued
travel warnings to not go to the US that's a market I've never heard of that
it's it's wild and you know the US does depend on tourism the US does depend on
exports to other countries and now you now you're dampening that,
you're dampening demand. I can tell you like here in Canada, it has been a very grassroots movement.
It hasn't been organized at all to not buy anything from America. I'm sure you've seen the same thing,
Dennis, right? Like every store, all labeled. Canadian flags on everything in the grocery store,
that's Canadian. And if you don't have a Canadian flag on it, they're trying to... And I get it. like every store or like all label flags on everything in the grocery store.
That's Canadian.
And if you don't have a Canadian flag on it, they're, they're, they're trying to
about, and I get it, you know, when your country's under attack and you're being
talked about as a 51st state, you're back, you know, the nice Canadian into the
corner and, you know, say, you know, put the gun to their head.
There's going to be some, you know, there's going to be some repercussions
and they're still going to apologize, but they're
going to stop buying your stuff.
Yeah, we're still going to apologize for it.
We're sorry we have to do this, but we have to do this.
We have to buy Canadian.
I mean, I think that's the big thing as I, as I look at it for Tesla now, where it's
just like the, like the way I thought of the old Elon Musk,
I would say like he could have powered through whatever issues there were with FSD,
killing a few people, whatever.
But his public standing right now,
I just like looking at that product,
and even if you love the Tesla bot,
looking at that product,
people not being able to buy it.
Like if you think of it as about as approval rating in America, right?
Like 60% against right now.
And that 60%, you know, I think is, I think you alluded to Dave, like those are more of
the people that are buying robots and, you know, self driving cars or electric cars, let's say.
Yeah.
Like conservatives are not the target market for electric cars because
genuinely they don't believe that there's a need for that.
Yeah.
So you're talking about alienating a core market.
So that's the problem.
As much as I might still say, like he could build a quality, like he could figure
out the machine learning on the FSD eventually, right? Work out the kinks and the training and everything like that and say, like he could figure out the machine learning on the FSD, eventually, right? Work out the kinks in the training and
everything like that. And say like, he might bring the best,
most affordable robot to market. It's just like, what is the
public's relationship going to be with that? And right now, it
doesn't look good. It doesn't look like it's going to get any
better than this. You know, kind of like we were talking about
with the tariffs. It's like, is there a plan? Like,
yeah, exactly. Like, how do I get inside of this? Yeah. And
then you couple that again, and it's not just about politics.
It's also about competition, right? Like he Tesla is getting
out competed now by other companies, the ID being right,
the being the big one, they're making cheaper, way cheaper cars. They're innovating on
battery technology way more than anyone else. To me, that is fundamentally disturbing. Back to the
original point that was made earlier about DeepSeek as emblematic of this shift in innovative potential,
where the US has always, even if it's not a leader in manufacturing and how economically devastating the loss of that position has been over the decades,
it has still led the way in innovation. And now we're losing that in tech. We're gonna be losing it in biomedical research,
by what's going on with government funding
of medical research, which I find extremely sad
and disturbing and we're going to be as a country,
not welcoming the best and brightest from around the world
or won't be a destination for them,
and they're gonna go other places.
So the US is at a really, I think, pivotal time here.
And I don't think anything is sort of irreparable just yet.
And I do think there's always the potential
that there are long run benefits to some of these policies
that there's gonna be short term pain, but I don't know.
I think you're both right.
What is the strategy?
What is the end goal here for some of these things
that seem completely unnecessary?
And again, it just brings it back to the markets.
I mean, that's why we aren't holding rallies.
That's why there's uncertainty.
That's why the international investor
is maybe moving their money to China right now
or moving their money to Europe
because there's less uncertainty there.
So until, you know, we get that defined strategy
and here's the plan, here's what we're gonna have,
but he's just kind of coming in and tearing everything apart
and just thinking it's gonna fix itself.
I mean, when you tear everything apart,
somebody's gotta fix it.
So there's jobs.
Like when you start cutting all these government jobs,
this has repercussions as well.
I mean, we can't just go in and say,
okay, yeah, we're gonna fire 6,000 IRS agents.
We're gonna do this.
This has repercussions that show up in the economy.
I mean, it's interesting and somewhat scary
as a US investor.
Yeah.
Yeah. I wrote like one of my favorite letters
when we went bearish and it was like,
it was after a Friday that was like February 18th
was the market or 17th.
Cause I think I wrote the 19th on a Sunday and
the article was called don't F with our money and
It was because uh on that I was like I was like what's going on? It was like a Friday
I was like what the hell's going on on the market today
It was just like tanking right and I was like normally I could find a reason
And on that day I couldn't find a reason. And then
I guess it was like on 233 that Steve that day that Steve Cohen who rarely talks basically
came out and said, I'm bearish now. And what reminded me of that was what you said, Dennis,
where he was just like, he was basically like, you know, if you're cutting $2 trillion from
the economy, like, basically, like, that's not good for the economy. He's like, you know, if you're cutting $2 trillion from the economy, like,
basically like, that's not good for the economy.
He's like, it was just like, it was, it was like, when he does talk, he's always very
understated and there's like all this stuff beneath the surface.
But you know, when Steve Cohen's coming out and saying that on a Friday afternoon where
the markets, I was just like, you know what, this is Wall Street saying don't f with our money,
right? Tariffs are going back and forth. And you know,
they're selling off and sending a message and then kind of like,
you know, who you might call the, you know, the mayor of
Wall Street, kind of, kind of comes out and is just like, this
isn't good. And I'm like taking the market now. And I think
basically was saying something to the effect of like, this isn't good. And I'm like taking the market now. And I think basically it was saying something
to the effect of like, look, you can move it up and down
and that might be fun for you.
But if you don't pick a direction, we're going to pick one.
And it's going to be down.
I think that's right.
You know, it's this, like we've talked about,
it's this uncertainty.
We haven't even talked about this whole reciprocal tariff
thing, right?
April 2.
I like to call it infinite tariffs. April 2, the largest tariff thing. April 2nd. I like to call them infinite tariffs.
April 2nd, the largest tariffs supposedly in US history are about to hit,
and nobody knows what they're going to be,
who they're going to be against.
I don't care how you feel about the policy.
You might think this is the greatest policy imaginable.
You might think this is the complete rebalancing
of global trade imbalances.
And that's a good thing.
And I agree, like that is a worthwhile aim.
That is a valid idea and even potentially
a reasonable way to achieve that.
However, how can you not tell people what's coming?
Businesses can't plan for it, right?
They don't know what to do.
That level of uncertainty just leads to pullback.
It leads to the consumer pulling back on spending.
It leads to businesses pulling back on spending.
They're waiting to see what's gonna happen.
And again, shouldn't be necessary.
Should be something clear and easily communicated.
Here are the tariffs that are coming.
Or on April 2nd, we're going to announce what's happening,
and we're going to put these in place over the next 12
to 18 months, and they are going to correct
these systemic and structural imbalances.
Great.
Good.
That's one way to do something.
But the idea that they're going to hit,
and that's when you're going to find out about them, it just
seems so economically unsound.
Yeah, and I think the historical precedent
is as I think about this,
is like it feels like you could do whatever to the commoners,
but it feels like he's pissing off the nobles now.
Like, and you know, there's no more traditional warfare. They're not gonna get their knights and march on the castle. That wouldn't go very well for the nobles now. Like, and you know, there's no more traditional warfare.
They're not going to get their nights and march on the castle.
You know, that wouldn't go very well for the nobles, but like economic warfare
is, you know, kind of what's happening here.
And I feel like that's why I'm so bearish on the market,
because I see him pissing off the nobles and the nobles are just going to be like,
OK, you're going to do this. We know you care about the markets.
We can make money shorting the markets.
It doesn't matter to us.
We want to be in control.
And if you're gonna be like controlling it up and down, like that's how we're gonna wrestle control.
And like, you know, it's kind of funny because me and you, Dave, are kind of probably aligned on the idea that Wall Street probably has too much influence, right?
For sure. Absolutely. But I think we're seeing kind of the other side
where he had like, it doesn't seem like Trump is working with
Wall Street at all. Yeah, on this. And that has consequences.
It's not everyday people who you might be able to convince and
sell and tell them you're giving something that they're good when
they're not. So yeah, I think that's the big reason where it's just like whether they be reciprocal infinite tariffs or like anything here, I just
don't see Trump starting to care about the markets and what Wall Street thinks all of a sudden.
And I don't see them budging either. I don't see them saying like, oh, we're going to support the
markets more even though you're doing this. So that is what I think is painting such a dark picture.
I think that's been one of the most surprising parts of all this to me,
because of the first term, he really cared about the markets and he would float
ideas out there. The market would react and he would adjust based on that.
It doesn't seem like there's any consideration.
That's the question that people are asking. You know, when we,
when he was threatening tariffs back in January, and he was giving us
his playbook, people would say, well, the markets go down too
much. We'll ask George again, maybe I heard stop one o'clock
or two o'clock. But when the markets would go down, like you
said, in the first term, he'd say something to bring them
back up. He seemed to care what was going on. So you had that
Trump put in place
where if the markets went down too much,
he'd say something to back off.
He'd say something to bring the markets back up.
He's giving no indication
that he's going to do that this time.
He's even said, oh, it's not down very much.
If the markets fall 20 to 30%, does he change his tune?
Maybe, but at what price is that Trump put? Because it's
not when the market's down 7%. There's no Trump put here at all. Maybe if the S&Ps lose
another 10% from here, then maybe he starts backing down on some of this stuff. But I
think Wall Street had that comfort in February thinking that even if tariffs come in, he'll
back down once the markets start going down. And now that the markets have went down, he's
not backing down. They're like, oh my gosh, we don't have a the markets start going down. And now that the markets have went down, he's not backing down.
They're like, oh my gosh, we don't have a Trump put, you know, so now what?
Now we need to like start thinking about this.
So the biggest question is just, you know, at what price does the Trump
put come back into play?
It's not here.
Maybe it's another 10% down.
I think at a certain price, it would be there.
I think if the markets were falling 20, 30%, he'd be like, okay, we need to like do something about this. But at this point in time the Trump put is clearly not these levels
Like yeah, maybe doesn't yeah, I think I think
my my
Suspicion I should say because there's it's there's not much to go off of. But you saw Besant come out and say,
we're OK with the market dropping.
There's going to be some short-term pain.
You've seen Musk say short-term pain.
I think they all expect that the next, I don't know,
two quarters, let's call it, which is how it feels right now,
is going to be rocky.
And then the policies will have been put in place.
They will start this
rebalancing, it will lead to a lot of US growth.
That's the expectation, all the regulations, size of government, yeah, that's going to
come through in the economic numbers near term, but then they expect it to unleash a
lot of growth and then it's all okay. And so they're sort of willing to
take the short-term pain, which if you have the outlook that they have, I think is a reasonable
approach. But that being said, my concern is if it actually leads to stagflation, because
if the market drops, they would expect interest rates to drop as well. And the problem is by putting tariffs in like they are, they're maintaining this sticky
level of inflation, which is going to handcuff the Fed.
And that's what the Fed is indicating as well.
Inflation expectations are on the rise.
This is a concern.
They're watching it.
Powell talked about that in the presser. They're going to try and disentangle non-tar it's tariff or not. Right.
Inflation.
They don't want inflation.
Yeah.
And we saw how horrible inflation was during Biden's term and what that did to people.
And the idea that we're going to bring some of it back, I don't know.
So to me, I think stagflation is the biggest concern macroeconomically.
And I really hope we don't see it,
but it can become a self-fulfilling cycle
as the market drops, as economic activity slows,
as the wealth effect acts the other way.
And then you have prices continuing to go up from tariffs.
All right, so I think we covered a lot.
This was a fascinating conversation, guys.
I want to thank everyone.
The viewership was really wild.
We didn't have many of you until halfway through
and suddenly everything just shot up,
but it's great to have everyone join us.
Make sure to check out Prospero.ai,
George's awesome application for telling you
what's going on in various
stocks and in the market. Check out Dennis's new stocktradernetwork.com if you're a trader
and you want to get some more insight and content into what's going on. Come visit us
at ervin.finance where you can connect with the companies that you invest in. And thanks
for joining us on another great episode of Let's Talk Markets Live. We'll be back next week.
And we're going to be talking with Mohit from a transfer agent.
And we're going to get a really interesting perspective, I think,
on the relationship between investors and the companies they invest in
and what it might look like when someone builds a new technology forward transfer agent.
So thanks, guys.
Again, really appreciate your time.
