#27 Israeli COVID facts, European Climate Lessons, Andy Kessler
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Manage episode 302366149 series 2821002
Podcast 27 Israeli COVID facts, European Climate Lessons,
Andy Kessler
DISCLAIMER: This broadcast is intended for educational
purposes only and does not constitute investment advice or an offer to buy or
sell any security or insurance product. All information provided here is for
educational purposes only and does not constitute investment, legal or tax
advice, an offer to buy or sell any security or insurance product; or an
endorsement of any third party or such third party's views. All examples
are hypothetical and for illustrative purposes only. Please contact us
for an assessment of your personal financial circumstances and to obtain
personal investment advice.
COVID UPDATE:
· An Israeli study showed that a booster resulted in a 10-fold
reduction in severe Covid illness in people over 60.
· On Aug. 25, Israel published the most powerful and scientifically
rigorous study on the subject of natural immunity to date. In a sample of more
than 700,000 people, natural immunity was 27 times more effective than
vaccinated immunity in preventing symptomatic infections. Which begs the
question; why does the Biden Administration ignore natural immunity if it is 27
x more effective than any vaccine, but rather believes you should lose your job
if you have convalescent antibodies and refuse to get a vaccine?
· Israeli researchers again found that one dose of the Pfizer
vaccine, instead of the normal two, was 100% effective in children ages 12 to
15. Such a finding could have significant implications for achieving broad
immunity in adolescents while reducing the risk of heart complications, which
have been clustered around the second dose.
· 214 myn Pfizer doses + 147 myn Moderna doses = 361 myn doses.
· A shot for a 75-to-84 year-old is 22,000% more likely to save a
life than a shot for an 18-to-29. For the youngest cohort, the FDA has yet to
resolve whether the very slight benefits of vaccination outweigh the very
slight risks.
· Vaccines reduce the death rate from 0.4% to 0.04%.
Climate and Ore
Total fuel consumption
of U.S. airlines is approximately 19 billion gallons annually.
Total fuel consumption
for mining Ore for construction of electric car batteries is approximately 21
billion gallons annually.
The 21 billion gallons
of fuel burned can only produce enough Ore to build 250,000 electric car
batteries.
The lifespan of an
electric battery is 10 years and is not renewable. By 2050 these batteries will
fill landfills with 50 million pounds of waste that does not break down.
I wonder if people
would still believe in electric power cars, vehicles or equipment if they knew
how massive the carbon emissions footprint really was?
Europe’s Climate Lesson for America:
Energy prices are soaring in Europe, and the effects are rippling
across the Atlantic. Blame anti-carbon policies of the kind that the Biden
Administration wants to impose in the U.S.
Electricity prices in the U.K. this week jumped to a record £354
($490) per megawatt hour, a 700% increase from the 2010 to 2020 average.
Germany’s electricity benchmark has doubled this year. Last month’s 12.3%
increase was the largest since 1974 and contributed to the highest inflation
reading since 1993. Other economies are experiencing similar spikes.
Europe’s anti-carbon policies have created a fossil-fuel shortage.
Governments have heavily subsidized renewables like wind and solar and shut
down coal plants to meet their commitments under the Paris climate accord. But
wind power this summer has flagged, so countries are scrambling to import more
fossil fuels to power their grids.
European natural-gas spot prices have increased five-fold in the
last year. Some energy providers are burning cheaper coal, but its prices have
tripled. Rising fossil-fuel consumption has caused demand and prices for carbon
permits under the Continent’s cap-and-trade scheme to surge, which has pushed
electricity prices even higher.
Russia has exploited the chaos by slowing gas deliveries,
ostensibly to increase pressure on Germany to finish the Nord Stream 2 pipeline
certification. Which…is precisely the reason to NOT finish the Nord Stream 2
Pipeline.
Vladimir Putin last week took a swipe at the, quote, “smart alecs”
in the European Commission for “market-based” pricing that increased
competition in gas, including from U.S. liquefied natural gas imports.
Andy Kessler: The Market Fails A Breathalyzer:
I am about to read from a column in Monday’s WSJ which mentions a
number of publicly traded companies. This is NOT a recommendation to buy
or sell any of them:
Joby Aviation, which plans to begin an electric air taxi service
in 2024, is worth more than Lufthansa, EasyJet or JetBlue. Does that seem
right? In this market, why not? Heck, earlier this year, Tesla was worth more
than the next nine car manufacturers combined, though now only the next six.
Beyond Meat, made with pea protein, is worth more than the entire market for
peas eaten globally—like the bumper sticker says: Imagine whirled peas. Do
fundamentals even matter?
Used-car sales platform Carvana is worth more than Volvo, Honda,
Ford or Hyundai. Airbnb is worth more than Marriott and Hilton combined.
Crypto-exchange Coinbase is worth more than the Nasdaq. We live at the
intersection of innovation and disruption, but when companies are worth more
than any possible reality, watch out.
How about those meme stocks still getting hyped on Reddit’s
WallStreetBets? Those who bid GameStop shares into the stratosphere waved at
Virgin Galactic Holdings as they soared by. A year ago, the stock was $6 and it
is now $190—some dupes paid $483, game over. Short sellers Melvin Capital,
Point 72 and D1 Capital focused on fundamentals and got their assets handed to
them. Shorts lost more than $9 billion between January and June.
Redditeers may want to put in a call to hedge-fund manager Eddie
Lampert, who bought Kmart and merged it with Sears in 2005, as a highly touted
“integrated retail” play, combining stores and online sales, eerily similar to
the argument for investing in GameStop today. The stock peaked at $135 in 2007.
It is now at $0.30 as the company languishes in bankruptcy. A 1970s Sears
Johnny Miller leisure suit is worth more.
AMC Entertainment’s stock was scraping $2 at the end of 2020. It
is now $50 thanks in part to Robinhood speculators, and the company has smartly
raised cash. But what about fundamentals? Theaters are still sparse, and Disney
and others are willingly putting blockbusters directly onto their streaming
services—ask Scarlett Johansson about Black Widow’s ticket sales. Theaters are
the new roller rinks.
In June, an Italian artist auctioned an invisible statue for
$18,000—in reality it was an empty box the artist claimed was a “space full of
energy.” Yeah, maybe fundamentals are a quaint relic of a bygone era.
Former Fed Chairman William McChesney Martin once explained that
the Fed’s job was “to take away the punch bowl just as the party gets going.”
From the looks of it, the entire market would blow about a 0.35 (as in Dow
35000) on a breathalyzer test.
So no, fundamentals don’t matter—well, until they do. In 1989
Tokyo real estate sold for as much as $139,000 a square foot—350 times the
value in Manhattan. At that price, Tokyo’s Imperial Palace was worth more than
all the real estate in California. Not anymore after Japan’s string of 4 lost
decades.
Yahoo was once worth $125 billion and AOL $200 billion during the
dot-com bubble. Both are worth 99% less today. Tesla CEO Elon Musk recently
tweeted, “I thought 1999 was peak insanity, but 2021 is 1000% more insane!”
Remember, when the selling starts, fear of missing out turns into fear of
losing everything as speculators jump like rats off a sinking ship.
The point is a simple one folks; be careful out there. A
waitress friend of ours at one of our favorite restaurants was so excited to
tell me last week that she just bought Moderna at $445/sh. Moderna (which
many of our clients and family own) is up more that 2000% from the low 20’s
last spring.
I highly suggest you find and work with a financial adviser who is
experienced, and who has seen this movie before.
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