3 charts for you today:
Most investors in Tesla aren't probably expecting to see major profits at the company any time soon, instead investing in the hope that in 5, 10 or 15 years Tesla will be at the core of the electric vehicle revolution — and making the profits that go with that position.
So those investors may have been pleasantly surprised this week when Tesla reported a tidy profit in its latest quarter. They'll have been even more surprised that Tesla reported a profit even if you were to exclude the $354m the company got from selling regulatory credits (which it gets because its cars are zero emissions).
That's a first for the company, which historically has always had to rely on selling its excess regulatory credits in order to turn a net profit.
Of course, Tesla needs to keep delivering (cars, and eventually profits) in order to justify its massive share price — which currently values the equity in the company at $670bn. That is about 4-and-a-half Volkswagens ($149bn market cap), 12 Ford Motor Companys ($56bn) or 16 Ferraris ($41bn).
The US economy grew 1.6% last quarter, or 6.5% at an annual rate, which officially brings real GDP back to its pre-pandemic level.
The economy is back
It's hard to overstate how violent and sharp the downturn in economic activity was last year. Never before had we seen anything even remotely close to the -31% annualized real GDP growth that we saw for one quarter in 2020. The worst quarter during the global financial crisis of 2008 saw the economy contract at a rate of -8.5%, and some thought we were close to the collapse of our entire financial system at the time.
So GDP has bounced back strongly. That is great, of course, but GDP is just an aggregate measure. Millions remain unemployed, or in jobs that they'd rather not have — and then there's the issue of inflation, which continues to worry many observers, and is having a real impact on workers. Average hourly wages reportedly rose 3.6% in June, but once you factor in inflation (which is running at 5%+), many workers have actually had a pay cut in real terms.
Both Facebook and Google reported huge earnings this week, as the digital ad market continues to boom.
David vs. Goliaths
As the tech giants scoop up an increasingly large share of the ad market, traditional channels are getting squeezed — and none are getting hit worse than newspapers. Data from Pew Research estimates that the daily circulation of US weekday newspapers hit an all-time-low last year of 24.3 million, way down on the 63 million daily circulation that was common back in the 1980s.
With falling readership, and of course no way of tracking advertising performance, it's no surprise that newspaper ad spending has declined every single year for 13 years.
Pivot... if you can
Some of the bigger US news properties have pivoted quite successfully to digital, but it's been a slow and arduous process. The NYTimes now boasts millions of digital-only subscribers, and last quarter they made up the majority of the company's revenue, but even for the NYTimes, print still makes up a whopping 40% of its total.
For small or local newspapers, making a huge investment into digital just hasn't been feasible — which is why it's no surprise that 1,800 local newspapers have closed down in the US since 2004. That number is only going to grow.
1) Two out of three remote workers polled have said they have worked from a bed during the pandemic, with a whopping 38% reporting that they work from a bed regularly.
2) A federal grand jury has charged Trevor Milton, founder of "electric truck" company Nikola Motors, with 3 counts of criminal fraud accusing Milton of lying about "nearly all aspects of the business". No doubt the promotional video of the Nikola One being rolled down a hill will make its way into the legal proceedings at some point.
3) After a slow start the EU has now surpassed the US in COVID-19 vaccine doses administered.
4) Got $10? That can be all you need to start investing tax-efficiently into cryptocurrencies with an Alto CryptoIRA™.**
5) Scarlett Johansson is suing Disney over Black Widow, the superhero film released simultaneously in theaters and on Disney's streaming service. Johansson contends that her pay packet was largely dependent on box office receipts from a theatrical release, which presumably were diminished by the streaming release.
**This is sponsored content.
