Elon's SpaceX leads global stock crash

[00:00:00]All right, so we got to talk about the markets as global stocks are crashing led by SpaceX. And let me show you guys the latest. Uh SpaceX sheds 400 billion in market value as debut rally hits reverse. You heard that correctly, 400 billion. Uh this is in one day, which is absolutely insane. And if you're like, okay, how big is this? Well, it's the second biggest in history, one day drop.

[00:00:23]SpaceX 400 billion drop is one of the biggest valuation wipeouts on record.

[00:00:28]And then basically all of these major moves to the downside has just been the last couple of years by big tech companies be it Nvidia uh SpaceX, Microsoft and Apple and Broadcom. And this is a real warning sign we are facing bubble and and just overstretch valuations and just too much leverage in the market. So there's that. Uh and then it was funny Bloomberg even calculated even more crazy. Uh SpaceX falls for third day. Okay. Erases 600 billion in market value. And I think they were going from like the very very top uh to where we are now. And then CNBC is saying uh SpaceX drops more than 3% following the 400 billion selloff. Uh this is the CH uh the chart live as of recording. So it closed 154 yesterday down 16% and then as of recording in the pre-market it's down 3%. So you can write down what the price is and how far you're down um by the time you see this video. But it's looking like that if you bought the SpaceX IPO uh right when it went public IPO, you are underwater cuz I remember it opened up around like 150 155 something like that. And so if it indeed goes at 149 like everyone's underwater, it's pretty insane when you're watching this stuff. Uh and then you get stuff like this uh Elon Musk and net worth. Now this puts him at uh still over a trillion, but I don't think this has been updated yet. So he may lose trillionaire status and that'll probably be the headlines today. Elon Musk is the first trillionaire to lose being a trillionaire and maybe he'll be bouncing up and down. But in my opinion, I think it's mostly going to be down because it's like his companies are are bubbles effectively, right? You could also call pyramids if you want to say that. It's a big pumping thing. And I want you to understand though, this is this is global. It's not just like one or two companies. This is a global market crash is what we're looking at. Uh, NASDAQ futures tumble led by tech stocks as Micron drops 9%. Ouch. South Korea's cobby falls 10%. This means the whole market over there. This is where I'm at actually. Uh, and it says live updates and the Micron thing must have just happened. Um, because I I'm just seeing this now for the first time. So, you're starting to see multiple effectively chips AI stocks and that kind of thing uh take a hit. In Korea, the two big stocks are um SKH Highix and Samsung. And they were down like 12% because they're basically a large large portion of the market and it just drags everything down. And it was in fact so bad uh I think it's when the stocks go down like eight percent something like that. They'll they'll freeze it. This is the whole market in Korea. So they had to freeze it. They they'll do that from time to time. And it's just been crazy volatile. So we'll see what it ends up being tomorrow. I'm recording this at night after the 10% drop. And there's a whole bunch of drama with that which we'll get into in a minute here. But I want to talk about SpaceX here. Um there see what is it? SpaceX slumps is set to push market value below two trillion.

[00:03:19]Okay. And it was so crazy to rate them even even this high, you know. Um it was Morning Star. It was like a $63 stock.

[00:03:26]Again, we're still in like the 150s. So, you still have a long ways to go down.

[00:03:30]And then you got Elon Musk, you know, promising you data centers and space.

[00:03:34]Not just data center, but data centers in space, moon bases, Mar bases, and bunch of other stuff. Um this actually came out and and I thought this was a pretty crazy. This is from Bloomberg. It says, "A lot of leeway. SpaceX's high-grade debt brings out skeptics."

[00:03:51]Uh, long story short, they go IPO, they raise uh I think it was like 85 billion, something like that. Okay, that's from their IPO. And then immediately, like the next week, they're like, "Hey, we're going to do a 20 billion bond." And it's like, "What?" and and then they're talk going on about how there's gonna be a bunch of cash burn in this company for the next couple of years and whether or not they'd be profitable is anyone's guess. And the reason why this says lots of leeway is because you know some people are questioning how did they get their credit rating for Moody's. It seems kind of questionable there, right?

[00:04:23]Uh let me read it. You can hear it for yourself. Make up your own mind. It says last week Moody's gave Elama SpaceX despite a limited public financial record quote sustained negative free cash flow and years of heavy capital spending still to come. Okay, the same uh BA rating, right? Um it is in many ways a testament to just how much trust credit markets are putting in Musk and the almost fantastical scope of his ambitions. Okay. Reusable rockets, a globe spanning satellite network, artificial intelligence, and even data centers in space. And then this says supposedly bond investors are lining up to provide the company about 20 billion of financing, potentially more. Wow.

[00:05:14]Maybe maybe here's more. uh S&P, which grades SpaceX one notch lower than Moody's at uh tripleB, expects the company to remain cash flow negative until 2030. Again, cash flow negative until 2030 with the burn rate rising sharply next year and again in 2028.

[00:05:37]It's like, okay, we just went IPO and it's like you want to borrow more, I guess. To help finance that gap, SpaceX is expected to lean much more heavily on debt with borrowings climbing to 132 billion in 2028. Wow. That's up from close to zero now after adjusting for cash and lease liabilities according to S&P. So, I didn't know about this 132 billion that's projected for more borrowing. But, but this this tells you the story, right? And if you know, just play devil's advocate here. Let's say you're an Elon Musk fan. and they say, "Oh, Chris, you're just so dumb. You can't read at all. You're just a moron."

[00:06:14]Right? Okay. So, in that world, that means you think you should be able to borrow billions and billions and endless money, right? Borrow forever and burn cash forever because someday you're going to be profitable on Mars. That's the bet. Or someday those data centers in space are going to be profitable for you. That that that's the bet. This is how ridiculous this thing is. And any reasonable person can be like, "Okay, I'm kind of questioning whether or not data center space will ever be profitable." And I laugh because here's the thing. Elon Mus followers are morons, right? There's two groups actually. There's a group that are the morons and the other group that are smart enough to know that it's all BS, but they're in it to basically scam the morons. And it's sad when you tell people the truth because they get really upset. What do you mean? Why do you call me a Elon Musk is really rich.

[00:06:58]Like like that's the justification. And it's kind of like, you know, hey guys, you know, your bookie is really rich.

[00:07:04]Your mob boss is really rich, right?

[00:07:06]Your I'll make it even more simple. The guy in the street corner who does the, you know, uh the the the three cups in the ball and you guess which one, hey, he's really rich from scamming you. Wow, that's great. But a lot of this stuff, it's like it's insane. You know, you're not going to Mars and and if you want to, I mean, I I guess you should give all your money to Musk and go there yourself and see how that turns out for you. Um and and this is this is what it is right now. People want their their money back actually in fact in um funds.

[00:07:34]So while you got the bubble in AI, you got people like, "Hey, I I need my money out of this stuff." Apollo curbs withdrawals. So no money for you after exit requests hit 17% reigniting fears over private credit liquidity. And you keep hearing this story. You got these funds scattered around. Uh it was even some of the bigger ones. I think it was um if I remember correctly, I believe it was Black Rockcks. We've talked about this and they had like this big fund that did this kind of stuff and it was even on leverage also and they had to um freeze withdrawals basically. And then this is yet another one. It's just like every couple days you'll hear this and I know it doesn't make like major news because it's not exciting. People want to talk about hey you know space dinner space data centers we're all going to be rich and look all these great robots. Oh my god it's so great we're gonna replace everybody. But behind the scenes you got these like weird credit rating things.

[00:08:22]you got these, you know, rumors like, "Hey, I think he's gonna borrow 132 billion. They're going to be burning money for the next couple years. Oh, but I swear, guys, it's gonna be worth a lot of money." And it's just like, it doesn't add up. There comes a point where it just doesn't add up anymore because you got to prove at some point that all this data center and stuff like that and all this borrowing is you're going to be able to pay it back and and, you know, be have a profitable company.

[00:08:43]You would think because if not, then our whole, you know, financial system is a fraud, which basically what Elon Musk is running. It should be obvious to anyone.

[00:08:51]uh big tech leads sell off in global stocks, right? That's going on. And uh even um over at SoftBank, they're even starting to call out the Mus scam. This is today this morning. Uh Masayoshi Son dismisses Mus idea for orbital data centers.

[00:09:08]You think I'll read a little bit of this. Softbank group founder Masayoshi son said there's little merit little merit he says to building data centers in space as championed by Elon Musk predicting that the AI race will be clenched by computing resources on Earth. Okay. The main advantage of building data centers in space would be to slash electricity costs. I guess the idea is you're going to put a bunch of solar power up there theoretically. Um but such expense uh comprise a small fraction of the cost of operating data centers compared with the hardware like chips. SN said during an annual shareholder meeting for soft bank mobile unit on Tuesday. So he's telling all these people publicly the trade-off for any power cost reduction would be include higher fees for transport, right? You got to get it in space.

[00:09:53]Maintenance is going to be tough and communication delays. But I just laugh because this whole thing's stupid. And they also have the problem with you're going to have to have really really big radsators to keep these things cool. So there's that. Uh and then you got this one. US tech stocks set to slide as AI route hits global peers. So basically this it just feeds off each other.

[00:10:12]Everyone's like, "Oh my god, did you see what happened in the Korean market, right?" And also you may have people who got money tied up in in both markets and basically start liquidating. I think there could be a lot of um Chinese money that's exiting markets as well because I've been seeing stuff to where it looks like the government is calling money back basically. So, for example, this says Tensson is said to mole exits from game studios like Marllis or Marvelous, however it is. Um, and then it goes on to say, I think that one's in Japan.

[00:10:37]And, uh, I saw something recently where again, China's like telling people like, get your money home. Basically, uh, Tensent Holdings is negotiating exits from several game studios investments in Japan. Right. So, again, this won't be a huge news in, you know, US news or whatever, but I just want to understand where the money is flowing. Uh, because actually a lot of there's a lot of Chinese money. It's not just Chinese money, but just foreign money in Korean markets also. And that's been our news to where I guess a lot of um foreign sellers are getting out the Korean market. There's like, okay, I played it up. You know, it was been fun while it's lasted and they they sold like nuts. Why it's down 10%. Uh and then we also had a a crazy situation here in Korea where there's too much leverage in the markets. Um so this was our news then.

[00:11:18]Uh Korea Markets is from Bloomberg.

[00:11:20]Korea Markets chief regrets allowing single stock leverage ETFs. And so basically and and actually you have that um in the uh US market as well. It was just announced recently if you wanted to short uh SpaceX there's a 2x thing to do that. So if SpaceX goes down 16% then you go up 32%. Which is the whole thing's whacked out. But this shows you like how how our markets move so quickly and and then a lot of people get into that whatever. And actually people in our community have been talking about that. I'll just say this. It's it's insane. Uh, and then you got stuff like this. While we're all, you know, fighting over how much leverage to get into AI trade, then big companies like Oracle are like, "Hey guys, we're going to use this AI technology, we're going to fire everybody." So, how I mean, how is this going to turn out? Just play it out. How's it going to turn out? If our whole economic system is based on, hey, okay, if if you're good friends and you say the right things and and you, you know, get everyone excited about space data centers, we'll give you a good credit rating. So you can go out and borrow a bunch of money to build all your stuff that's not going to work and you're going to keep burning cash for a couple of years and and if it does work, we're all going to lose our jobs. Like how how is this going to play out? Like this is why this whole thing is absolutely crazy. And I've said so many times this is the peak bubble action, right? You got Trump and his delusional stuff, be at the UFC fight, be at the uh pool and he's arresting people now. And then you got Musk and his IPO and then and then you got a couple other companies that also want to go IPO.

[00:12:44]They're trying to grab that money before it's gone. And so essentially that that's where we're at at the moment. Uh and then you got stuff like this, a fatal Tesla crash into uh Texas home now under federal safety investigation. It comes a point where you know people are going to start calling out on on your BS essentially. So that's my thoughts on this. Please be careful out there.