Narrative demand can override stock fundamentals
The guest discussed how intense retail and institutional demand for story stocks can sustain inflated valuations far beyond their fundamental worth.
The argument
Using SpaceX and Tesla as examples, the guest explained that when share supply is tight and a company has a massive fan base, the stock can trade on future hope rather than current profits, defying traditional Ben Graham value metrics for long periods.
Hear it yourself
"So towards the end of the year, people are expecting a rise in interest rates. And that's that's kind of what is holding down silver in the short run. But in the long run, it's not gonna if we look at it as a precious metal rather than industrial metal, in the long run, it's going to react more to the real interest rates. So if we see inflation being persistent, and I think we will, but if we see inflation being persisted at the higher levels that we're at now, which is up only touching on 4%, then I think the even if they raise the interest rates by a quarter percent, we're still effectively at zero real rates."
03:45
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