Know Your Risk Podcast We Need a Recession So Bad
Oct 2, 2025
Zach dives into the disconnection between market valuations and reality, questioning the price drop after Tesla's delivery news. He critiques overvalued tech stocks like Apple and examines whether current market movements indicate a blow-off top or a shift in volatility. Advocating for a recession, he argues it could reset inflated asset prices and promote economic mobility. He also discusses risks associated with high-priced stocks and identifies contrarian opportunities in the energy sector. A cautionary outlook suggests investors stay prepared.
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Market Detached From Fundamentals
- Zach Abraham argues the market is wildly disconnected from fundamentals and many valuations are irrationally stretched.
- He finds repeated examples where slower-growing firms trade at much higher multiples than faster growers.
Tesla Delivery Pop, But Warning Signs
- Zach uses Tesla's Q3 delivery pop and a 4% stock drop as a reality check on market sentiment.
- He links the delivery bump to EV tax credit timing and warns competition and execution threaten Tesla's future.
Rising Multiples Amid Deteriorating Business
- Zach highlights Apple trading at ~40x earnings despite slowing growth, margin compression and weak innovation.
- He stresses rising multiples amid worsening fundamentals is a clear red flag.