Elon Musk has some stock he wants to sell you.
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Today’s Agenda
Tesla Makes Stock Printer Go Brrr
Tesla’s day job may be making and selling electric cars, but its real passion is printing and selling Tesla stock. It announced plans to sell $2 billion worth of the stuff in February, $5 billion more in September and $5 billion more today.
Investors just can’t get enough of this future member of the S&P 500, whose share price has soared tenfold in the past year. Why not give the people what they want? Well, as Liam Denning notes, Tesla has declared all along that it doesn’t really need the money. And it has $20 billion on its balance sheet. This is an awfully expensive way to raise cash you supposedly don’t need. It almost makes you wonder if Tesla actually needs a lot of capital after all, to fuel the breakneck growth it needs to justify its outrageously high stock price, which it keeps using to raise more capital, in a business plan drawn up by M.C. Escher.
Your Corporate HQ May Be Moving
This newsletter is produced in suburban New Jersey, where its writer lives, so as to be just a couple of donkey-cart rides away from Bloomberg’s offices in New York. But this writer has not darkened the door of that office since early March and may not see it again until March 2021. This newsletter could have just as well been produced on, say, a beach in South Carolina, which most would consider a cheaper and more appealing locale than suburban New Jersey.
The pandemic has exposed that New York and other elite coastal cities don’t need to be the center of America’s work universe anymore. This may reverse when the pandemic ends, but probably not fully, writes Conor Sen. Everybody now realizes rents are much cheaper, and amenities and talents often just as plentiful, in second-tier cities elsewhere in the country. So Goldman Sachs is moving its asset management business from New York to Miami-ish. Hewlett Packard Enterprise has moved from California to Houston. Elon Musk may move Tesla from Cali to Texas. This newsletter will remain in New Jersey. It builds character.
We Need a Faster Coronavirus Escape Pod
At some point very soon, the official tally of Americans killed by Covid-19 will pass the number of Americans killed in combat in World War II. If you are not a fan of bitter ironies, you may want to skip to the next paragraph right now. Because it turns out Moderna’s vaccine candidate, one of the most effective we know of, was concocted over a weekend in January, before the first recorded American death.
We probably shouldn’t have started mass-producing Moderna’s vaccine in January without testing it first. But it’s also worth asking why we couldn’t have sped up the distribution of this and other effective vaccines, Tyler Cowen writes. Once we hit some threshold of safety and efficacy data, we could let people volunteer for what would be essentially extended trials while we wait for full FDA approval. We’d have a better chance of spotting problems and probably save lives in the process.
As it is, it will be months before vaccines are in wide distribution in the U.S., where the pandemic is raging out of control. We’ll need better treatments for the disease to keep the death toll and long-term complications down, writes Sam Fazeli. Unfortunately, those are also months away, but they are coming.
We’ll also need more lockdowns to control the spread and keep the hospital system from collapsing. Nobody wants to hear that, partly because many of us are scarred by how harsh and arbitrary shelter-in-place orders can seem. They don’t have to be this way, writes Mark Buchanan: Rather than closing the economy based on guesswork and hard-to-follow data, we could take a cue from engineering and use a series of short, predictable lockdowns, sort of like an anti-lock braking system. It could make the next few months safer and more tolerable.
Telltale Charts
Markets around the world are signaling a classic recovery from a deep economic contraction, writes John Authers. This could also mean stocks’ best days are behind them.
Further Reading
The Donald Trump administration shouldn’t classify Yemen’s Houthi rebels as terrorists, cutting civilians off from aid and making peace talks much more difficult. — Bloomberg’s editorial board
It’s troubling that Texas thinks it’s OK to even ask the Supreme Court to enact a coup. — Noah Feldman
How President-elect Joe Biden handles the controversy over his pick for defense secretary will say a lot about how he’ll govern. — Jonathan Bernstein
China can help the global economy by forgiving developing-world debts, and the U.S. could help make that happen. — Scott Morris
Moncler’s purchase of Stone Island puts it on a path to becoming a new luxury behemoth. — Andrea Felsted
Here’s how you should get ready for Biden potentially forgiving federal student loans. — Erin Lowry
ICYMI
Mitch McConnell darkened stimulus prospects.
Trump’s prospects of overturning the election grow much darker today.
Webull is taking business from Robinhood.
Kickers
Now we know who found that hidden treasure in the Rockies. (h/t Ellen Kominers)
Dark personality traits don’t help people succeed.
Photographer captures an octopus with a transparent head.
New York Times critics’ picks for best books of 2020.
Note: Please send treasure maps and complaints to Mark Gongloff at mgongloff1@bloomberg.net.
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This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
To contact the editor responsible for this story:
Brooke Sample at bsample1@bloomberg.net
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