Luke shares his experience surprising his wife with the new Tesla Model 3 Highland, complete with its futuristic driving features $TSLA — is the smooth buying process enough of a differentiator for Tesla as a car company?
Meanwhile, Krzysztof reveals his strategic moves in the “King of the Jungle” portfolio challenge, including a bullish stance on $BTC mining and AI data-warehouser Iris Energy $IREN and why he sold 20% of that position to buy even more shares of Coherus Biosciences $CHRS.
The jungle duo also dives into ethical investing as Luke considers adding Palantir $PLTR and explains how the company could be seen as a force for good. Amid the tech talk, they reflect on the complexities of investing within ethical parameters.
[00:00:02] Luke: Hi, and welcome to the latest episode of Wall Street Wildlife with your hosts, Luke and Christophe.
Christophe, you’ve got a different background back there. You’re somewhere other than the, uh, the scorched earth that is Austin in the summer, I gather.
[00:00:19] Krzysztof: uh, Ila Encanta di Sicilia. ~I don’t know if that, I don’t know if that was~
[00:00:26] Luke: Ooh,
[00:00:26] Krzysztof: If you’re Italian, ~please, uh, ~please don’t be
[00:00:29] Luke: ~you have a, uh, ~
are in beautiful Italy though.
[00:00:30] Krzysztof: yeah. ~Southern, ~southern Italy ~with, uh, with Greek roots. And you are ~with Greek and Arabic and Islamic and Italian roots. That’s what Sicily is made of. ~And I’ve, yeah, it’s quite a cosmopolitan place. ~And I’ve been busy stuffing my face with doughnuts full of cannolis. ~What,~ what have you been up to?
[00:00:47] Luke: We just had a big birthday weekend in the Hallard house. My wife had a birthday, ~wasn’t we? We are arguing whether it was or wasn’t a birthday present, but she, uh, ~we took delivery by surprise to her of the new Tesla Model three Highland on her birthday. So, uh, she says it’s not a birthday present because we are getting it anyway.
Anyway, ~she, ~she got other gifts, but we now have a, uh, black Tesla model three with a white interior. Cause I was so, taken by your own, white interior and your model three performance. And it’s, uh, yeah, it’s a beautiful machine.
[00:01:20] Krzysztof: Oh, yeah. Black and white. That’s nice. I could see that. ~I could see that rolling. Uh, I could see ~rolling along, smoothly on the streets of London in that fine machine. Are the differences pretty big?
[00:01:30] Luke: ~And, uh, and ~this ~height, the ~Highland, which ~if you, ~if you’re a Tesla acolyte, you’ll realize is the brand new, ~like the ~the updated, ~the ~refreshed model three,~ three, ~and they’ve got rid of interesting stuff. So you no longer have any of these little stalks behind the, uh,~ uh, ~steering wheel. ~And ~if you want to indicate there’s ~like ~buttons under your left thumb, also like a high beams, like~ like a ~flash the lights button.
And if you want to change gear. That’s on the screen. ~So you just kind of, so I’m kind of figuring out ~it tries to be smart. ~So ~when you sit in the car, ~when you, if you ~plug in your seatbelt~ seatbelt ~driver’s seatbelt, it then assumes you probably want to go forward. ~So ~I think it probably looks at the cameras as to which way you want to go.
So it just says like depress the brake pedal. ~And ~when you press the brake, it automatically puts itself into gear, ~like ready to, um, ~Ready to get rolling. ~like ~It’s interesting. ~I, uh, ~I thought I wouldn’t like having the indicators and these things as buttons, but I’ve only driven the thing like 50 miles in the city over the weekend and already having stalks feels like~ like ~archaic and old.
I much prefer the buttons now. It didn’t take long to convert.
[00:02:28] Krzysztof: That’s so fascinating. That reminds me of when Apple, there was the whole big to do about them getting rid of the button on whatever iPhone, you don’t know, cause you live in a Android cave, but the rest of us evolved humans have the, you know, went through the button, no button evolution. And there was a big to do, you know, don’t.
Get rid of our button. How could you get rid of, you know, how can you do the swipey thing? And the swipey thing turns out is second nature though. I wonder when you were saying that, you know, like, I guess in normal traffic y, par for course situations, I could see why it’s not a big deal, but let’s say something crazy is happening on the road.
And you need to, I guess, switch direction, but you have your old memory of you need to, you know, do something manually. ~it, ~could that possibly be a source of trouble? Like, being able to
[00:03:21] Luke: none of those things are safety critical. ~Like it’s. ~Like you’re not, it’s not like you’re in a manual car where you’re going to be ~like ~handbrake turning and doing like crazy shit to maneuver around ~like ~something in front of you. Like ~if you’re, ~if you’re switching from forward into reverse, or if you indicating, these are all obviously very important functions of the car, but they’re probably not functions that will come into play, ~like ~in the one second before you actually have.
Potential impact, right? So I guess the easier things like if you moved, I don’t know, the horn or you move the break somewhere else, that would obviously be a relatively substantial change to the user experience.
[00:03:54] Krzysztof: Okay, so you’re not seeing that with, uh, this revamp.
[00:03:58] Luke: I buy it. Uh, I quite like it. I thought maybe I wouldn’t get on with it. To be honest, actually, uh, Katrina hasn’t got behind the wheel yet cause it’s been a pretty boozy weekend as well. ~But, ~and so, uh, I’ll probably get ~some complaints, ~some complaints from her when she’s like, where is the indicator? ~But, uh, ~but yeah, I’m sure she’ll figure it out.
[00:04:15] Krzysztof: Well, congratulations on joining team white leather. ~ I’ll say, ~this is one of these intangibles as far as investments go. That old adage, you know, buy what you know, or buy what you love. And you talk about the white leather on the surface. It’s meaningless. I mean, really, it makes no difference whatsoever. But, for me, that car is the only object safe for maybe the iPhone, which I kind of feel continues to give more.
As a material object, because of how good it makes me feel aesthetically or in terms of just, you know, the, not the poshness, I wouldn’t call it poshness, but something about it feels good. And that those kinds of things are hard to replicate. And so, you know, um, not a small thing when you’re an investor and you notice something like that is alive for you in your own world.
[00:05:10] Luke: Yeah. Yeah. I agree. Like ~I, ~I do try and avoid spending money on stuff. I’d rather spend money on experiences, but, You’re right, that sort of sits in a bit of a gray zone. There’s ~a, there’s like ~an element of experience ~to, um, a, a, uh, And, um, ~and as an element of like~ like ~due diligence on the company, like, I’m not saying I’ve got ~like ~a model three’s worth of DD benefit out of it for my Tesla shareholding.
~Um, ~but I’ve got some additional insight into the trajectory of the company to be fair, I probably got more insight when I sat in your model three with actual FSD. ~Um, but, uh, ~but useful to keep track of ~like ~the company’s design. Aesthetic and, uh,~ uh, ~engineering skills, ~uh, revolving,~
[00:05:44] Krzysztof: Yeah, right on. What else, uh, anything else you want to add to the experience of buying, uh, yourself, I mean your wife, uh, a birthday present?
[00:05:55] Luke: like it is, it does. ~It was, ~it reminded me ~how, just ~how easy it is compared to, I don’t know, I’ve probably owned, I don’t know, 25 motorbikes over the years and I’ve owned maybe 15 cars, ~uh, ~up until I bought my first Tesla. And, uh, you know, it’s always a bit of a trying experience ~buying a,~ buying a new or used motor vehicle.
~Um. ~But it’s just very easy with Tesla. Uh, it’s all done in the app. I was very happy like paying the full invoice, like a week ahead of picking the thing up because I’m relatively confident they’re not about to go out of business or scam me. There was no element of negotiating or debating as the price you pay.
It’s just kind of low stress. ~And, uh, ~and it’s quite nice. The buying experience itself is quite nice. You know, went along ~and, um,~ to my local, ~uh, ~Tesla, not dealership, I don’t know what you call them, like store. And then out back in the car park, they had like a container that they converted into like a little office with some coffee and tea, ~and then.~
There was a little gang of, ~uh, ~enthusiastic looking boys and girls there ready on the morning when I arrived to pick up their own cars. ~uh, uh, uh, ~
[00:06:58] Krzysztof: ~that ~But it’s interesting to hear all this conversation with regard to your car in the context of many Tesla investors saying Loudly Tesla’s not a car company and yet, you know the whole process from beginning to end the way Tesla has now Upgraded that ~is ~is huge.
It’s a significant chunk of its identity. I’d say regardless of all the other stuff going on. ~Okay,~
[00:07:23] Luke: I’ll tell you what. What was a nice little random bonus. ~Uh, so, ~uh, so like just an hour ago, I got an email from Tesla saying, as a thank you for taking delivery this quarter, please have 15, 000 miles of free supercharging. Didn’t expect that so pretty happy
[00:07:40] Krzysztof: Oh, there you go. Where are you going?
[00:07:41] Luke: ~Yeah. Well, ~Yeah. Well, well, we’re heading ~to Paris Going ~to the Paris Olympics in August. So, uh, I’ll be spending some of that free supercharging on the way there and back That’d be handy.
[00:07:48] Krzysztof: Oh, you’ll be driving there. Uh, ferry.
[00:07:51] Luke: ~ Really a tunnel ~as a tunnel goes under the channel
[00:07:53] Krzysztof: Oh, wow. I did not know that. Okay.
[00:07:55] Luke: we invested in some fabulous infrastructure, built the tunnel so you can drive, well not drive, you, drive onto a train and the train takes you across to the continent, but at the same time as building this fabulous bit of infrastructure, we then sort of in parallel, uh, created all this political, challenge with Brexit.
And, uh, I’m seeing even today on Twitter, people bemoaning. Like multiple hour queues at Frankfurt airport. I’m kind of Brexit immune cause I got my Irish passport, but, uh.
It’s not pretty, the country’s done something very dumb there.
[00:08:25] Krzysztof: I’ll refrain ~from ~from any politic commentary this week. ~We~
[00:08:28] Luke: let’s not go there, but we’ve got an election coming up in the UK very soon, next three or four weeks, I think, ~got the, ~got a snap general election that’s been called. So, uh, Looking forward to that chance to vote out the current, incumbent party.
[00:08:41] Krzysztof: ~Okay.~ in I think the main feature of today’s episode is we’d like to update you on the king of the jungle. Challenge as a way of talking about, I suppose, you know, what we see are the best opportunities in the market and highlighting our approach to this contest ~S seven months, ~it’s month seven.
Right. ~ ~
[00:09:01] Luke: ~so. Yep. ~Yep.
[00:09:01] Krzysztof: at the moment, Badger is still whooping monkey’s ass to the tune of, looks to be approximately, I don’t know, 1900 to about 1300. So I’m about 600 bucks behind, which is sizable.~ It’s, ~
[00:09:18] Luke: noticed you made a nice little recovery.
[00:09:20] Krzysztof: Yes. ~And I’d~
[00:09:21] Luke: lead, but you’ve closed it in the last week or two. What’s happened?
[00:09:25] Krzysztof: I’ve closed the gap a little bit, but I’m actually really enthusiastic because ~of ~nothing I’ll say to you is new, but ~it’s my, uh, ~I only ~had three, essentially I ~had three small cap companies in the portfolio, my Tesla position is ~one new and ~really, really tiny. So it’s not going to make a difference, but all three of those small caps are bets on undervalued, very risky.
~Uh, ~it’s overstating it, but they’re not all zero ~or, ~or moonshots, but they have extraordinarily high, ~uh, ~potential for reward, but also with reward comes a lot of risk. ~1 ~I was advocating for 7 investing ~as, um,~ for us to consider introducing into the portfolio. And that’s, uh,~ uh, ~Iris energy because I really, really love.
The way they’re building up their, ~uh, ~computing data infrastructure from the ground on up and becoming both a Bitcoin miner and also provider for future AI data warehouses. And, ~uh, ~it seems drastically undervalued relative to all the others. And as of, I guess, ~uh, ~last week. It returned over a hundred percent.
~So, uh, ~so went from something like five when I bought it up to 11, at some point, so it’s actually ~a hundred and ~more than a hundred percent. ~I, ~
[00:10:42] Luke: ~Why? Why? Why have they, uh, why have they, ~why have they increased in value so much over such a short period?
[00:10:45] Krzysztof: I think ~these are, ~these are the weird gyrations of short term market, the value was there to see. And what’s hard for investors often is when the value is visible and nothing really has changed, ~why does the market not,~ why or when does the market finally start to recognize it?
The most obvious reason for the change is that Bitcoin has gone up in value, but it hasn’t really gone up that much since. a couple months ago. But I think it’s part of ~you know, ~the speech I’ve been given is that I think Bitcoin regulatory conditions or rather crypto regulatory conditions are becoming more favorable.
It’s becoming a driving political force. And this is, ~uh, ~at the moment, I think one of the best run miners in the space and it was undervalued. So at some point, big buyers come in, and then that whole perception thing turns around. ~It’s a little bit more. I don’t want to say, well, ~it kind of gets a little bit into that technical analysis stuff, where price is a self fulfilling engine, if you will, but you just have to have enough patience to wait it out. ~Uh, ~the other thing I’ll say about it is that earnings were ~how long ago? ~Within the last month. And the company more or less said it’s It’s~ it’s ~It’s perfectly well capitalized to take advantage of becoming ~one of the most, uh, ~one of the strongest miners in the space in terms of the hash rate. So that means in terms of the amount of computing power they have at their disposal.
So there’ll be. Mining more Bitcoin, ~they’ll be, they’re, ~they’re shaping up to be one of the top three miners. And so what you’re seeing in this industry, and I know you don’t care that much, but ~for,~ for most of our listeners, ~right? ~Or for anybody interested ~in, ~in crypto, ~uh, ~this is a kind of doggy dog world where you have to have enough computing power to make it.
And if you don’t, the economics no longer work and you die. And then all of that. mining gets done by the top. So it’s sort of like starting to siphon into the players that are going to make it. So I picked well at the moment, ~ ~
[00:12:50] Luke: ~I we should shut off our video. Okay. All right. Uh, we’re doing okay. We’ll just stick with it. I’ll fix it in the edit. Um,~ one thing I’ve always been a bit skeptical about ~it ~with your Bitcoin miners is kind of links into what you just said.
Like you do have to spend a ton of capex to buy. ~Like ~mining hardware. And then presumably that mining hardware is going out of date every six months or every year and to stay competitive, you have to keep buying ~like ~the latest generation of graphics cards, whatever kind of hardware the guys use. How does that make sense?
~Like ~what ~are ~the miners do with their kit? How do they avoid it becoming just ~like a,~ like generating ~just ~tons and tons of. technological waste as they can’t use, ~like, ~previous generations of technology.
[00:13:29] Krzysztof: Yeah, well, unfortunately, I’m not an expert ~in, ~in the precise details about this, but this is one of the main reasons I really liked Iris is because they’re doing both data warehousing and putting all those chips to use in the future growth of AI cloud. And. You know, the history of Bitcoin is short right now, but what we know is that ~from, ~from its inception to what is it, 16 years later, the chart, it’s been the best performing asset class, maybe ~in the, ~in the, I don’t know if the history of assets, but it’s certainly like astronomical growth.
So ~the, ~the view historically is that the appreciation and price more than makes up for the investment in CapEx.
[00:14:13] Luke: So then they’re mining, but they’re also holding crypto on their own books.
[00:14:17] Krzysztof: Iris is actually not holding crypto. They’re selling it right away to invest in their CapEx and increase the speed and so forth.
[00:14:27] Luke: Ah, okay, but they benefit from the appreciation of Bitcoin because the stuff they’re mining is more valuable.
[00:14:32] Krzysztof: ~Correct. ~Right. And at the time I was advocating for it, ~uh, ~we could see that the relative value of its assets was, ~uh, ~compared to what the price of Bitcoin was, was so low that the market had little choice, but to bid up the value of the company. I mean, it’s one of those, you know, I call timely arbitrage situations,
[00:14:53] Luke: Okay. All right. Well, okay. It’s, uh, whatever they’re doing, it’s working out for you in the contest because it’s closing the gap.
[00:14:59] Krzysztof: but here’s why I’m excited. I was able to then sell 20 percent of those shares. At, uh, I think my first lot was only at 60% gains ’cause I added some more as the price went down and I reallocated the, that capital to more shares of coherence and more coherence options dated for January 25. So here’s, ~here’s, here’s, uh, ~for all of you keeping track at home.
Um, most of my losses have been due to my options expiring worthless. So that’s cost me, uh, I think about 300 something dollars for the contest, but ~I’m going back again to, ~I’m doubling down on that approach. And at this point in this moment of the contest, I control approximately 500 shares of coherence, 300.
~And ~shares outright plus two options of 100 shares each. So if the inflection point that I’ve been waiting for does happen in the next quarter or two, then more or less every dollar ~the, the, ~the company gains will Net me about 500 in portfolio value. So ~uh, ~that gap ~could, ~could close conceivably quickly.
If of course I’m right about coherence,
[00:16:18] Luke: But as ever, if you’re at home managing your own investment portfolio, do not try to mimic what Christophe is doing because it’s a very high risk strategy. And if you’re doing it just to win the contest, okay, great, but you know, I hope you’re not doing something similar in your main portfolio because if the company doesn’t appreciate it.
Again, you’re just massively overexposed to it, and especially using derivatives, like a chunk of your capital could go to zero.
[00:16:45] Krzysztof: right? So this goes back to the ~risk ~risk management and in my main portfolio, coherence is my number one position, but I am not adding, even though I’m adding in this contest because of risk management. ~It’s. ~Principles, so for the contest purposes, I’m actually feeling pretty good ~badger, uh, ~because ~I have. ~I have my three companies that are still quite undervalued, during a time when the market is pretty frothy. So ~let’s see, ~let’s see what happens in the next two months.
[00:17:13] Luke: Okay. ~Well, I wish you ~well. I wish you well. Uh, as ever, I’ve not done much in my King of the Jungle portfolio, although I am about to buy Palantir. It’s one, it’s a stock I bought for my own personal portfolio a couple of weeks ago. I think I’m going to add a chunk of Palantir to my, uh, my King of the Jungle portfolio as well.
[00:17:36] Krzysztof: I asked you some questions about Palantir on our, ~uh, ~investor conversations at 7investing and I buy what you’re selling And yet, you know how hard it is to change one’s mind, you know, ~um, ~like deep down, ~um, ~I still worry about the company in the sense that I worry about technology being abused in a sense that no fault necessarily of the company’s own, I don’t know if that’s the right way to say it, but ~how do you, ~can you explain for people ~who, ~who might hold the same Orwellian suspicions that any company that is.
in cahoots with, say, the government and big data that they won’t sell out ~our, uh, I guess ~I guess our personal data and infringe on our liberties.
[00:18:23] Luke: Well, I can’t, no, because they possibly are doing that, but I’m willing to be a shareholder and support the company’s mission regardless, because I feel they’re also doing important things, for, the West’s military capability. What’s the Spider Man quote? With great power comes great responsibility.
here we have, um, ~Uh, ~one of the world’s greatest software platforms for analyzing data at scale and drawing inferences and forming plans. I suppose I’ve rather those tools are in the hands of the West, ~uh, ~given today’s geopolitical climate. So if those tools can also be turned towards ~the, ~the citizens of the West, then I know I’m afraid.
I’m afraid that’s just something ~I’m, ~I’m eating as a shareholder ~that, uh, ~that nefarious things might be happening.
[00:19:16] Krzysztof: Yeah, it’s a tough moment, uh, for humanity. It seems like more and more, um, lines that you can’t walk back from have already been crossed. So with a company like Palantir, I’ll just state for investment purposes, I’m intrigued by the company. I’m intrigued by the technology. I could see it being a wildly successful investment, but there’s something still too gray area ish it for me from an ethics perspective that doesn’t allow me to be comfortable with it as an investor.
And therefore Not to say that you’re, you know, I wish you all the best and I hope that you are right. I hope that these are the kinds of tools that have to be used for good to keep off, well, good from our perspective. Um, but when there’s this kind of grayness, and I don’t often resort to ethical or moral lines in the sand, but when one is clear to me, then I will choose to simply say, too hard and, and kind of wash my hands clean and hope everything works out for the best.
[00:20:19] Luke: Yeah, that’s fair. And everyone’s ethics and principles are different and a ton of people make good money investing in the tobacco industry, that’s personally one, I don’t see any upsides to, I just see downsides.
So I’ll stay away from that, but if other folk want to make money that way, then fair enough, I guess.
[00:20:37] Krzysztof: So I think about ethics and morality quite a bit, and it’s complex. ~And ~I think in one, Luke said is right. ~Uh, ~investing I think is most clear and, um, it’s easiest to not tangle yourself up in things you can’t control. And then how you use your money. ~You could use. You know, ~you could invest your money that you made as an investor in all kinds of causes for the good.
~Uh, ~but ~I, ~I wouldn’t go as far for myself as saying, investing is ethics free, or at least that’s not how I choose to invest. I just try to keep those situations. ~To the ~to the minimum because there’s no holy place to stand and things are way more complicated ~than ~than we think
[00:21:23] Luke: For sure. And I wouldn’t criticize anyone for just being a full on capitalist and focus on growing their portfolio as the overriding thing, investing is individual. ~with me? Should we, ~
[00:21:33] Krzysztof: so this has been another episode of Wall Street wildlife We are on YouTube And all the major podcast platforms. Check out our shiny PDF on wallstreetwildlife. com, where you will find the 10 laws of the investing jungle. I am at seven flying platypus and Luke is at seven Luke Hallard.
[00:21:57] Luke: Are you ready to become a beast of an investor? Your journey starts here. ~ All right. Do you want to hit stop and then let’s just see how much lag it’s got to catch up.~
~Okay. ~
