When do we finally start to understand that the whole investment industry has become more scam than real?
The scam has been there from the beginning when some guys got together under that buttonwood tree in lower Manhattan 235 years ago and started betting on each other's fortunes.
It was always there, and it always followed a fairly predictable pattern of boom-n-bust, which is why FDR's smart guys put in some rules and regulations, which built an amazingly strong country with an amazing strong middle class - all of which gave us about 60 years without a major panic or depression.
But now, it looks for all the world like the scam rot outweighs the legitimacy content by an ever-widening margin.
Gotta ask yourself: How is it that Main Street keeps going deeper into the shitter while Wall Street keeps livin' in high cotton?
There's a bad moon on the rise.
Key Points
- SpaceX shares fell on Wednesday after the company’s jump in spending rattled investors.
- Space X said its capital expenditures jumped sixfold to $18.4 billion in the second quarter.
- CEO Elon Musk said SpaceX would hit $1 trillion in annual revenue in 2030 versus a previous forecast of 2031, as he tried to allay investor fears.
In SpaceX’s first earnings report as a public company on Tuesday, Elon Musk’s space firm said its capital expenditures jumped sixfold to $18.4 billion in the second quarter. This figure was ahead of analyst expectations, with the majority of the spending going towards AI.
The company’s stock closed at just over $125 on Tuesday, sitting below its $135 IPO price. It is well off its more than $200 all-time high that was hit shortly after its listing.
Investors have been on edge this earnings season as concerns rise about whether large tech companies can prove their multibillion-dollar investments are yielding returns.
While SpaceX’s own models are seen as behind OpenAI and Anthropic, the company is positioning itself as an alternative cloud player by renting out the computing capacity that it is building with Nvidia
chips.
SpaceX’s CFO Bret Johnsen looked to allay investor fears over capex spending. The company has been “efficient” with its spending, he said on an earnings call.
“On the AI compute side, we’re able to deploy capital in such a way that we’re getting less than a one-year payback,” Johnsen added.
The share price fell even as SpaceX narrowed its losses and promised significant future revenue. Musk said SpaceX would hit $1 trillion in annual revenue in 2030 versus a previous forecast of 2031.
“SpaceX wants to tell the story they’re the market leader ... But people still have these questions: how quickly can they grow? How big are the costs going to be before this thing gets to profitability?” Steve Westly, founder of The Westly Group and a former Tesla
board member, told CNBC’s “Squawk Box Europe” on Wednesday.
The company is contending with another potential market-moving event on Thursday — the expiration of insider lock-ups. This means that insiders can finally sell a portion of their shares.
