Sell bitcoin, buy Tesla

Which is madder, bitcoin at $41,500 — oops, make that $31,000 on Monday — or Tesla shares at $880 apiece? Don’t get me started on the crypto-mania in which the Financial Conduct Authority has warned gamblers ‘they should be prepared to lose all their money’. But Tesla, relatively speaking, is a real thing: a California-based carmaker which has expanded the frontiers of the electric vehicle market that’s going to become huge in the next decade and could soon make carbon–fuelled road transport extinct.

Put that way, it’s not so surprising — in tech stock terms — that investors should value Tesla higher than the rest of the US auto industry combined. But those investors are not making an objective calculation based on projected profits or dividend flows. They’re just betting on the self-propulsion of a share that has risen tenfold since March and, while the old economy remains on its knees, may have a way to go yet. In that sense they’re not far removed in mindset from the wackos who are hypnotised by bitcoin. But at least Tesla shareholders are the ultimate owners of a clutch of ‘giga-factories’ and car designs, whereas bitcoiners own nothing but an evanescent idea. If you’re in that zone, ‘Sell bitcoin, buy Tesla’ still looks like a sensible trade.

How to spend it

Tesla’s surge made its maverick founder Elon Musk the richest man in the world when he briefly overtook Jeff Bezos of Amazon, both now sitting on notional fortunes of $180 billion. Conferred as they are on unlovable people by irrational markets, you could say these rewards make capitalism look grotesque. But the benefit, I suggest, is that they don’t appear to buy happiness and are so huge that only a tiny portion can ever be spent on lifestyle — so in the end, they will have to be given away to good causes.