January 9, 2022

Sunday morning

January 8th, 2023

Hello everyone,

Hope you have all had a successful first week in 2023.

John has already been busy sending out trade alerts. If you managed to get into a couple of them – well done. He timed that recent move up in the market well. What can we expect going forward? Listen to John’s webinar on Wednesday 11th January to get up to date with the latest happenings in the market. For customers that are not nightbirds, wait for the replay later Thursday.

California has been experiencing severe weather since New Year weekend. A parade of cyclones has been pounding the state over the past week and these conditions will continue for most of January. Hundreds of thousands of people are without power. Six people have been killed. Businesses have been flooded and homes damaged. Mudslides, downed trees, and powerlines have created havoc on roads. The advice from Emergency Services is to stay inside unless you must travel.

Meanwhile, back inside the walls of power, Kevin McCarthy was elected Speaker of the House, eventually. He is from Bakersfield, which is just north of L.A. The Republicans don’t think he’s radical enough, far enough to the right for them. Consequently, it took 15 rounds before he was elected. To secure the position of House Speaker, he made quite extreme concessions to win over a section of the far-right. He plans to focus on immigration, “woke indoctrination” in schools, and challenges like debt and the Chinese Communist party, in addition to law enforcement and criminal prosecution. There will be no dull workdays for Kevin McCarthy.

Have you bought any Tesla shares yet, Tesla LEAPS, call spreads? John believes we are close to the bottom in Tesla stock. But do expect the market to be quite “moody” into mid-February. So, more downside may be on the cards. We are hearing messy news regarding Tesla. We know that Tesla suspended production at the Shanghai Plant in response to a Covid-19 wave that is far worse than what is being disclosed. 2.5 million is the official number declared with covid, but the real number may be more like 250 million.

A big positive for Tesla is the news that it will open a fifth factory in Mexico, near Monterey, the Detroit of Mexico. Construction should cost $10-$20 billion. Tesla will have access to a lot of cheap labour as Ford, General Motors and Hyundai factories are already there.

Tesla sold 1.31 million vehicles in 2022, with production growing 47% compared to 2021. However, the numbers fall short of Musk’s pledge to grow by 50% in 2022. But 40+% isn’t bad by any means. Even so, shares plunged an astounding 14% and are now selling for a very attractive 35% discount to big tech. Does anyone consider that dipping your toe in the water here is not worth taking the risk when this company is growing earnings by 40% a year?

Twitter has been an annoying distraction as far as most investors are concerned and it has taken Musk’s focus away from Tesla.

Have an extraordinary week. Don’t forget to laugh and have fun.

Cheers,

Jacque

We are what we repeatedly do.