Historian, investor, and author of "How to Get Rich in American History," Joseph Moore, explains the historical precedent for investors to reasonably take a long position in SpaceX (SPCX).
First, I want to ask you about SpaceX. That is a story of the day. What are people getting right? What are people getting wrong in it?
Well, I think you hear a whole lot of conversations around things that look back to maybe a few decades of history looking at IPOs and that's perfectly rational, right? IPOs tend to pop, they tend to come back down.
Um, but the bigger question is, what is the historical analogy here to this type of a company? And it might actually be general electric, right? So this is the last, you know, Elon obsesses over Nikola Tesla, but he actually acts a whole lot like Edison, right? He brings together teams, he tries to simplify problems, and he conglomerates a lot of different innovative companies together and he sees the synergy when maybe others don't. And that's exactly what General Electric was. It was it was a a lamp company, a manufacturing company, an auto a transportation company for infrastructure in cities. And so there were all these companies that that Edison understood would feed each other with innovation over time. And for 100 years, that was correct. And so, I think for those who are long this idea, there's actually a really good historical precedent that you're not you're not terribly off base. We have seen an innovation disrupt a brand new space where there's a lot of competition before.
The other part of that, much like General Electric, we forget how much competition was in that space in those early days. and sorry for the pun on space, but there's a lot of innovation in AI, there's a lot of competition and all these things. is it better to be one of those companies or to bring all those innovations under one roof? which is what General Electric did.
Yeah. Now, those analogies always break down at some point, but there's there's at least a reason historically to think about a long position there.