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“Any customer can have a car painted any color that he wants so long as it is black.” – Henry Ford

Below is a snippet of commentary from today’s Morning Lineup.  Start a two-week trial to Bespoke Premium to view the full report.  

In its last earnings conference call, Tesla CEO Elon Musk noted that the rollout of the Cybertruck has been “production hell”. During yesterday’s rollout, the sentiment from that conference call was on display when the Tesla website said that the base model of the Cybertruck wouldn’t be available until 2025.  Given the complexities involved in manufacturing the Cybertruck with, among other things, its stainless-steel exterior, it shouldn’t come as a surprise that it’s difficult to produce.  Still, we found it ironic that the product launch came just one day short of 110 years after Henry Ford unveiled the first moving assembly line for cars and reducing the time it took to complete the build of an entire car from half a day to an hour and a half!  And now on to the markets.

The year is now 92% complete, but a lot can happen in the final month.  With a gain of 9.1% on a total return basis through the end of November, the S&P 500 had its best month since July 2022 and only its 15th monthly gain of over 9% since the start of 1980. With November’s gain, the S&P 500 is up 13.8% over the last year which is two percentage points better than the one-year average total return of 11.8% dating back to 1928.  While the last year was above average, the last two years have been weak. The 1.7% annualized gain would be flat if it wasn’t for the dividends. It’s hard to believe but the S&P 500 closed yesterday just 0.80 points above where it closed exactly two years earlier!  After factoring in inflation during that time, investors are staring at an annualized decline of about 5% over the last two years.  While the two-year return has been well below the historical annualized average of 10.6%, returns for the last five and ten years have been modestly above average, while the 20-year annualized gain of 9.7% is 1.2 percentage points below the historical average.

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