Tesla just lost over half a trillion dollars in market cap.
Let that sink in.
Why is Tesla (TSLA) stock collapsing? Bears point to problems at Twitter, Tesla's 19th recall this year and Chinese demand issues. But yet another issue, and the "elephant in the room" for Tesla, according to Hedgeye Industrials analyst Jay Van Sciver is the Federal Reserve.
In other words, the rising cost of capital.
"This is another liquidity withdrawal name that's going to get hit as Fed policy becomes less accommodative," Van Sciver explains in the video above on The Call @ Hedgeye.
"Tesla rallied very sharply on policy accommodation in 2020," he adds. "That's where you saw the bubble in EV, new energy and 'planet saving names' hit. Now we're on the withdrawal side."
"I don't know if calling it 'The Mother of All Bubbles' gives due credit to what's happening at Tesla," explains CEO Keith McCullough.
Below is a chart from Van Sciver.