Motley Fool Hidden Gems Investing - The Fantastic Future

Episode Date: April 15, 2016

Wall Street's big banks report. Mark Zuckerberg lays out his vision for Facebook. And PC sales continue to fall. Plus, best-selling author Ashlee Vance talks Elon Musk, Tesla, and SpaceX. For a free preview of our Motley Fool PRO service, go to TryPro.Fool.com. Learn more about your ad choices. Visit megaphone.fm/adchoices

Chris Hill. Everybody needs money. That's why they call it money. From Fool Global Headquarters, this is Motley Fool Money. It's the Motley Fool Money radio show. I'm Chris Hill. Joining me in studio this week from Million Dollar Portfolio, Jason Moser and Matt Argersinger. And from Motley Fool Deep Value, Ron Gross. Good to see you as always, gentlemen. Hey-o! We've got the latest on retail, energy, tech trends, and more. Best-selling author Ashley Vance will take us behind the scenes at SpaceX and Tesla Motors. And as always, we'll give you an inside look at the stocks

on our radar. You can hit us up on Twitter, at Motley Fool. Money is our handle. Got a message from Ben Wechter in Austin, Texas, who writes, Hoping for a good show this week for my run at the Boston Marathon. The pressure's on. Good luck. Pace yourself, Ben, and good luck at Heartbreak. I have notes. I'm the only one without a computer. Don't worry, it'll be a good show. We're going to do our best. Earnings season has begun with most of the big banks reporting. Bank of America, Wells Fargo, Citigroup, JPMorgan Chase, Matty Argesinger. Any themes out of this group?

Well, I can tell you three of the banks you mentioned failed the living will test from the Fed, which, if you don't know, is one of the stress tests that basically measures if any of these banks feel significant stress or there's a major economic event that affects their earnings or their loan portfolios, can they be wound down without affecting or causing major harm like we saw in 2008? Right now, the answer is no for a few of these banks. These are regulations that were put in place through the Dodd-Frank Act. It's only significant the sense that if they fail again, they could be subject to some more capital constraints and potential breakups, which we've heard a lot about in the news.

On the earnings side, though, it really was kind of the same. Profits are down, but not as bad as expected. That's kind of what you're seeing across the banks now. And as we were talking before the show, it's kind of interesting that Bank of America has really not talked about Countrywide, which of course was that huge failed acquisition back in the teeth of the financial crisis. O' Disastrous. The face of the disaster, in my opinion. Right, and the number is staggering. I just found this. The acquisition was about $2.5 billion in January 2008. As of two years ago, and I couldn't find an update on this, but as of two years ago, Countrywide has contributed

more than $50 billion in losses to Bank of America since its acquisition. Not only the face, but the tanned face. Yeah, it's really phenomenal. I was actually working at Bank of America as a loan officer at one point before I made my way here. It's very interesting to see how that acquisition was really just so, so bad on so many levels. We make fun a little bit of these banks will only cause a problem if we run into trying times again, but I think you probably have to just expect that we will run into trying times at some point. It's not very reassuring that they're not necessarily prepared.

Well, I will say this. From a regulatory standpoint, the banks are about as safe as they've ever been. Now, whether or not they're making good loans, we know there's obviously stress right now in the energy space where a lot of the banks have made loans. But a lot of these banks trade for less than book value per share. And they've really underperformed the market over the last few years. So, if you're looking for potential bargains in the market, you could do worse, probably, than the banks right now. I agree with that on the face of it. I'm always worried that these balance sheets are not properly reflecting values, and therefore I don't feel that I can trust book value.

That's a good point. If I could, I would agree. I'd be all over it, but I just wouldn't sleep well. The other interesting point is, we're in the face of an extremely low-rate environment. In some cases, there are folks around the globe with houses where the banks are actually paying them for their mortgages, as opposed to them paying the banks for their interest. It's going to be interesting to see how long we can really sustain this low-rate environment, because that obviously plays out and makes profitability as well. B of A's acquisition of Countrywide. Are we safe calling that the worst acquisition

of all time? This is more of a merger, but I'll go AOL time. Right up there with it. That's the one I was thinking about. In terms of value destruction, I totally agree. Peabody Energy is the largest coal company in America, and this week it filed for bankruptcy. So, Ron, if you're wondering about the future of coal, I mean, they were the largest. How are the smaller ones going to survive? Well, we've had Alpha Natural, Arch Coal, Patriot Coal, Walter Energy also filing. So, they are not alone. It's the classic story, deteriorating operating results and too much

debt. We've seen it really across commodities. I unfortunately have seen it in zinc. Weakness in China, lower commodity prices. In the specific situation with coal, you have competition from domestic shale gas, which was putting pressure on coal prices and demand for it, and then you have a ton of debt. A $5.2 billion acquisition in 2011 in MacArthur Coal in Australia really loaded debt onto their balance sheet, and the operating results just can't handle the service of that debt, and they're forced to file. You know, we root for no business to go down, and we certainly don't root for employees to lose their jobs. But as an industry, just thinking about the world at large, it's

hard not to root for coal to go down. You know, that's interesting, and it creates an environmental concern here, because coal companies must clean up the environment, which they destroy as part of their everyday businesses. And with these companies going out of business, there's a big question out there about whether the money will exist to clean up the environment. And there's a lot of folks that are concerned, and I think rightly so. We're also seeing ripple effect, obviously, in the railroads with CSX reporting this week. On balance, their quarter was fine, but their coal shipments year-over-year fell

more than 30%. Big number. It reverberates through many different industries. This week, Facebook held its annual Global Developer Conference. CEO Mark Zuckerberg gave the keynote address, laid out his vision for the company. Jason Moser, what can we look forward to next from the social network? There's a lot going on with these guys. The thing I like about Zuckerberg and his perspective is, he really is a long-term thinker. This goes well beyond just social networking. His North Star is the belief that a connected world is a better world. All of his decisions basically stem from that notion. We're looking at Messenger here in the coming years to really

be the forefront of their innovation. One of those innovations, it's not something that Facebook invented, but chatbots, which essentially are ways to help facilitate the relationship, in this case, between customers and businesses. That's what he's trying to do, is to help change the customer service industry that we've dealt with for the past 20, 30, 40 years. It's always been calling up a 1-800 number and just dealing with long waits and really not getting anything done. Chatbots are supposed to help take customer service to the next level. We've seen a lot of platforms, Facebook and Twitter, for example, really capitalizing on this customer service opportunity. And it works, it does. It works very well. I've

personally had a number of customer service interactions that have gone very well. You resolve them very quickly, you can multitask, it just doesn't require you to do as much. The interesting question here in regard to commerce is, with Messenger, is this going to be a channel that dictates consumer behavior in the future, or is it going to be just one more solution, one more piece of an overall solution there. I can tell you, Facebook really wants this to be the former. I think they want this to be something that does change consumer behavior. Not necessarily sold that it will be, because there are more ways to get things done than ever before. And then that begs the question of, how exactly do they monetize this? So,

there are a lot of questions still to be answered there. But regardless, I think if you're an investor in Facebook, you've got to feel good about where they're going and the fact that he's looking at things from a three-year, five-year, and a ten-year perspective. And hey, he's talking about lasers, Chris. When you've got Facebook talking about lasers, you probably have your money invested with the right company, right? I can't argue with that. I guess I was just impressed that Facebook has a developer conference. That just shows you right there that the platform is so big now. It is. We were talking about this before taping. Facebook, the core platform, everybody

basically knows that. But I think Zuckerberg had the prescience to think, well, hey, let's break out Messenger and let's make it its own app. There were a lot of questions initially when that happened. It's making a lot more sense now, because he saw that, hey, maybe at some point, people are going to lose interest in, perhaps, posting what sandwich they ate for lunch, or the mess that their dog made while they were off at work. And now it's become more about just communication, right? So, breaking Messenger out into its own app, I think was a smart move there. And then you have Instagram and WhatsApp. So, when they're leaving one platform, they're going to another platform. Hey, it's nice if you own that other

platform. O' I liked how he took some political swipes, because he's all about connecting the world, and he took some building bridges, and some deportation things, and building walls. Anti-Trump, maybe? O' There were some veiled comments there that were pretty funny. Well, and I like the point that you made, Matty, because we've talked before about the entertainment industry and how all these additional platforms that are available

for people who create television shows, movies, etc., gives them a lot more options. We're seeing that play out with developers as well, as Facebook joins the likes of Google, Apple, and Microsoft as having their own developer conference. That's just one more way to spur the economy. It's just thinking of Facebook more as a tech company than just a social network. I think that's the way you need to invest something like this. O' Is it time for The Motley Fool to have our own developer conference? I think we should probably work towards that direction. I think we're there. I think we're ready

for it. I don't know if we're ready for a developer conference, but we do have a new Facebook group called Motley Fool Podcast. So, if you're a listener and you want to join the conversation online, you can just get onto Facebook and search for Motley Fool Podcasts, and we'll see you online. Coming up, we'll give you an inside look at the stocks on our radar. You're listening to Motley Fool Money. As always, people on the program may have interest in the stocks they talk about, and The Motley Fool may have formal recommendations for or against, so don't buy or sell stocks based solely on what you hear. Welcome back to Motley Fool Money, Chris Hill here in studio

with Jason Moser, Matt Argersinger, and Ron Gross. Gentlemen, for the sixth quarter in a row, sales of personal computers have fallen. PC sales are now at their lowest level since 2007. That's a lot of hurt for a lot of big companies. Yeah, not very pretty, Chris. Yeah, it's roughly, depending on what study you look at, about 60 to 65 million PCs were shipped in Q1. Now, that's down roughly 10% from a year ago, but last year was the worst ever, I guess the worst since they've been tracking PC sales. And there were 300 million, roughly 300 million units sold. So, we're on track for 250 million this year, and it could be way under that. So, it's not very looking

good. If you're Dell, HP, Lenovo, of course, if you're AMD, Intel suppliers, there's just been a dramatic shift in how people are computing. It's gone to mobile. I will note that Apple was one of the few, of course, that did have a pickup in sales. Mac sales were apparently up about 5%. But we are seeing IT spending overall ticking up. It's just that, I don't know, are they just a victim of their own success? Because we've talked before about how the refresh cycles for computers at businesses now, because computers are better than they were 10, 15, 20 years ago. Companies are looking at their budgets and saying, you know what?

We don't need to upgrade every two years. I was going to say, I feel like there is at least something to that. On the flip side of this, it's not like everybody's just going and using phones or tablets to get their work done. If anybody has tried to actually use an iPad as a production tool, it's definitely not as robust at this point yet as perhaps a laptop, or if you have a setup at your computer with a double monitor or whatever. So, I think there's a ways to go before tablets really do become the actual norm for a regular office setting. But yeah, I think definitely, computers are better now than they ever were, and so they certainly last longer.

Well, they're better now than they ever were, but also, the computing power has has been outsourced to the cloud. You don't need, actually, your laptop that's sitting in front of you right now to do a lot of heavy lifting right now. All the software and services that I'm using are being commuted elsewhere. I make it a point, whenever I replace my mattress, I get a new PC. There you go. That's the refresh cycle of all refresh cycles. There you go. Perry Ellis reported a fourth quarter loss, but revenue came in about what Wall Street was expecting. Ron, they announced preliminary results a few weeks ago. This wasn't good, but it certainly wasn't a train wreck.

This is really muddy and cloudy. They announced preliminary, and the stock got hit about a month ago. The stock got hit about 9%. Now, they reported actual, which, thank goodness, was in line with the preliminary results, because if they're not, boy, that could be a problem. And they reiterated fiscal 2017 guidance, which is good, and those results are actually relatively strong. So, I think the stock is moving up and down based on these announcements and it's clouding the true picture here. The company is actually in the midst of a two-year strategic plan to rationalize their business, improve profitability and grow the company. They've exited 30 less profitable brands, they've entered into almost 30 new

licensing agreements, they've cut costs. So, at this point, you have the stock trading at a PE of about 9 based on fiscal 2017 guidance, which for a company that is both profitable and improving profitability, to me, is just too cheap. And I think that fact is getting lost somewhere. So, I think it's meaningfully undervalued. I think it's a great jumping point to get into the stock for folks that don't own it. When a company, any company in any industry, announces preliminary results, isn't it always bad? Have we ever seen a company say, you know what, our quarterly results are so good, we're going to tell you about them early?

No. You'll see companies upping guidance, but it's usually done within the actual press release of the announcement. They don't usually go out and do it in advance. Fourth quarter profits for Pier 1 imports fell more than 40%. Overall sales fell as well. And yet, Jason Moser, shares of Pier One up almost 10% this week. How low are the expectations for this company? Pretty low, Chris. They were pretty low. The good news is that they are growing their e-commerce operations. They're becoming more a significant part of the overall revenue pie. The bad news is that that's actually coming at the expense of their brick-and-mortar retail stores. That's really what Pier One

that has been for the longest time, is freestanding, brick-and-mortar retail stores where people, many moons ago, actually went out and physically walked through and did their shopping. As you mentioned, it's really played out in the stock, too. I mean, it's really weird. I was looking at the 10-year chart, and I'm trying to think, man, this looks like something. The 10-year chart looks like the state of Kentucky. I mean, go to a map and look at ... You recognize that? Look at Kentucky. It's low, it hits this big mountain, and now it's starting to fall back down." So, there was a time where this actually was a good investment, and I don't

know that it necessarily is going to be for the foreseeable future, because competition is so much greater. Now, we hear a lot of these retailers talk about the word omnichannel, and that's code for figuring out ways to optimize all aspects of the business, physical, digital, and create a seamless customer experience. Now, the companies that aren't mentioning that word, omni-channel, are the ones that were born of the internet. So, Amazon, Wayfair, businesses like those. Those are businesses that really were built with a leaner cost structure in mind and with more ways to tackle the consumer and provide excellent customer service. Those are some of the challenges that Pier 1 faces today.

Let's get to the stocks on our radar this week. Ron Gross, what are you looking at? I'm going to go with Chipotle, CMG. Stocks at $4.66, down 30% over the last year. We've talked a lot about the reasons. It's popped off of its 52-week low, which was a little bit under $400. It was there for maybe a day. But, I think it's looking interesting here. Still trading at 30X earnings, but those earnings are depressed, theoretically. We hope so. The stock drops maybe 5% or 10% more. It's time to start taking a nibble and maybe getting it even cheaper down the road, but still establishing a starter position. Jason Moser. Sure. I've talked about Craft Brew Alliance

before, ticker BREW. And looking at this one, responsible for brews like Kona, Widmer Brothers, Red Hook. Kona brand has really turned out to be the big moneymaker for these guys, making up about 45% of overall volume now. But what caught my eye here was, just this week, Anheuser-Busch InBev has announced to buy Devil's Backbone, a little craft brewer here in Virginia. So, But we're seeing some more consolidation there. And given Anheuser-Busch InBev's interest in the Craft Brew Alliance, they own about 30% of their shares outstanding, it opens up a tremendous distribution cycle for Craft Brew Alliance. I can't help but wonder if there's not going to be some more consolidation here to come. Craft Brew Alliance ships a

lot of beer. They're closing in on about a million barrels a year. So, it's a significant brewery out there with a number of different brands in the portfolio. So, I'm going to keep an eye on it. I promise, Jason, I did not plan this, but I'm also sticking in the Craft Brew beer market, I'm going with Boston Beer, ticker SAM, the leader. And really, sort of the same reason, consolidation in the market, or, we know how strong craft beer has been, if there's a downturn in craft beer, I feel like that's going to help the bigger players, including Boston Beer, just take back a lot of the market share that they've had from these smaller

players who have really come on, who have borrowed a lot of money, and who might go out of business over the next few years. O' Big advantage in the means of production and distribution there. Absolutely. That's who wins. O' Burritos and beer. That's a show right there. The Peter Lynch principle of buy what you know. Ron Gross, Jason Moser, Matt Argersinger.

Guys, thanks for being here. Thanks, Chris. Coming up next, a conversation with bestselling author Ashley Vance. Stay right here. You're listening to Motley Fool Money. Money, money, money, money, money, money, money. Welcome back to Motley Fool Money. I'm Chris Hill.

Ashley Vance has been a technology journalist for over a decade. He is the author of Elon Musk, Tesla, SpaceX, and the Quest for a Fantastic Future. And he joins me now from San Francisco. Ashley, thanks for being here. Thank you very much for having me on. You were given access to Elon Musk for this book. What was your opinion of the man before you started writing, and how did it change? Yeah, you know, it's kind of funny.

I went through many stages of Elon over the course of the process. I have covered technology for a long time in the Valley, and I was actually kind of Elon skeptic, I guess you might say. Early on, it felt to me like he was always the guy out there from the early days of Tesla and SpaceX kind of promising the world and then really struggling to deliver products on time or products that were really solid. and um and so i you know i just thought he was one of these techno utopian guys running around and then in 2012 everything kind of changed for me spacex docked with the international space

station and tesla got the model s out and solar city where he's chairman went public all in this really short span of time and that's when i became fascinated with him and and did a cover story on for Businessweek magazine, and then shortly thereafter started the book. And I guess along the journey, I would just say that all these attributes that you see about him, his intensity, his weirdness, his, you know, lust for business, all just came through just clear and clear as I went on reporting the book. Musk grew up in South Africa. How did that upbringing shape the man that we see today?

I think it definitely had a big influence. He's 44 now, and so he was born in the early 70s. And the South Africa of that time, it was this very masculine culture. A lot of the school setting revolved around athletics. And Elon, he was this loner kind of sci-fi nerd who didn't fit in that well to this environment. he was not into sports at all he got bullied all the time he was the guy over in the corner just reading a book and trying to stay to himself but but people weren't that easy on him he had a really tough home life as well he didn't get along with his father at all and and so i think you know

a lot of this it struck me as as scarring him to the point that you can see now in life he's he's on this quest to prove to people that he's special and that all these people who either ignored him or roughed him up when he was a kid were wrong. One of the things we focus on at The Motley Fool as investors is not just what is the balance sheet or the financial strength or market opportunity of any given company, but how is that company run? Because companies, at least for the time being, are run by human beings. But when we think about corporate culture at a given business, some score higher than others. Sometimes that translates into actual financial performance. How is Musk regarded as

a leader within his businesses? How is he regarded by employees? Well, there are a couple of surveys that came out recently about his companies that matched up really well with what I found from my reporting, which is that he commands more passion and belief from his employees than apparently any other CEO in Silicon Valley. And he's also the toughest guy to work for. And you're looking at putting in the most hours and having probably some of the worst work-life balance at his companies. This is a guy who wraps every one of his projects, whether it's SolarCity or SpaceX or Tesla in this grand mission. I mean, with SpaceX, his mission literally is to colonize Mars.

And for some people, that sounds nuts. It so happens that there are thousands of really smart space engineers who this is also their life calling. And so they've found the one guy that they think is most likely to make their dreams come true, and they'll do just about anything for him. The reality of Tesla and SpaceX in particular is that you have to work a six-day work week. That's the bare minimum. He burns a lot of people out.

They might go five years working these crazy hours and then just can't sort of take it anymore. And we've seen now that companies like Apple and Google and Uber have gotten into the automotive business that it's getting a little bit harder for Tesla to hang on to some of these people who didn't really have options before. And so, I don't know. I do think this is one area where he's kind of similar to Steve Jobs in that he's not a regular CEO. He's almost like a religious figure to his employees. Let's talk a little deeper about a couple of these companies, and we'll start with Tesla Motors, which recently received more than 325,000 pre-orders for its Model 3. It's going to be priced at around $35,000, and will start being delivered, at least in theory, by late

2017. The early demand seemed to outpace the expectations for this vehicle, and it seems like it might have outpaced Elon Musk's expectations as well. As you mentioned earlier, this is someone who has his doubters, at least in terms of delivering vehicles with Tesla Motors. What do you think Elon Musk and his team at Tesla are doing to prepare for delivering hundreds of thousands of vehicles a year? I think they're probably having night terrors at this point. But I mean, it's pretty funny. So when the Model S came out, it was this sedan and nobody knew for sure how it would sell. And Tesla was like the most shorted stock on wall street and i think even that car really exceeded what elon expected it

turns out apparently there's a ton of very wealthy people who are willing to buy what was initially really an experimental car and then over the last couple of years elon's star has just gotten brighter and brighter and brighter and now you see the end result of this i mean i to me i talked about this in the book because the book came out before we had like a real firm delivery date for the model three but i sort of felt like if tesla stayed ahead of the competition not just on the electric vehicle stuff but i think it's really the software inside of the car and this idea that you're buying sort of a computer on wheels you know at that point if you have 35 000 to spend And it becomes a really attractive proposition. Instead of buying the past, you're basically buying the future. You're buying a car that can get upgraded, that in some ways gets better. Over time, as Tesla adds these new features, you're buying into the mystique of Elon and Tesla.

And so I think that's where all this has come from. I think as much as Tesla has gotten right, they do not seem to have figured the manufacturing side of their business out to a very satisfactory degree. We haven't really seen improvements from the Model S to the SUV, the Model X. In fact, there's like a recall now on the Model X that just came out. And so, you have to be pretty cautious. Tesla's usually late on their products. The first ones tend to be a little glitchy, and now they have, you know, 350,000 people waiting for a perfect car. And you mentioned the competition. And with the Model 3, Tesla Motors has more competition now than they did before, because mainstream automakers, or I should say, mainstream market, that $35,000 vehicle market, the likes of General Motors and others, they were sitting on the sidelines, for the most part, when it came to the Model S and the Model X. But

with the Model 3, you've got GM coming out with the Chevy Bolt. Does that get to them at all, or have they had sort of a bunker mentality about automotive competition since day one. You're totally right. They definitely have more competition. We even see it on the high end with BMW and Audi finally getting their act together around electric vehicles. It'll be interesting to see how well the Model S can continue to do. The trick is, though, I really believe it goes back to that software that we were talking about. And when I was interviewing the mainstream automakers for the book, I came away pretty depressed at their response to the threat that Tesla posed and also at how they were responding to the rapid pace of advancement with

car technology. To me, if you compare the Chevy Volt to what the Model 3 is going to look like and the technology that's going to be inside the Model 3, I think the Tesla buyers end up being really happy with their choice. I also think you've got this whole Apple-like halo effect going around Tesla. This is a big problem for the car makers. It's the new, sexy, exciting car company. It has this mystique around it. People aren't just buying the car, they're buying into this whole lifestyle. See, and that's what I don't get about the reaction to Musk from competitors today. Because I can see having some doubts maybe five, 10 years ago. But when you look at the track

record he's built up, I just think, and by the way, I think this about competitors, and I think this about investors who decide they're going to short his stock. Because it's not to say that it's a guarantee that it's going to the moon, but this just seems like one of those business leaders that you never want to bet against. Yeah, I mean, well, to me, you remember, like, when the iPhone came out, I mean, Steve Ballmer from Microsoft was like, this is a joke, and all the phone makers kept saying, what does Apple know about phones?

And you see how that turned out. Nokia disappeared a couple of years later, and so did RIM. I mean, every now and then, if you have the right product and the right business leader, at the time, it can be really disastrous for the incumbents. And I totally agree with you. When I saw SpaceX, they just had a recent launch where they landed this reusable rocket. I mean, this is like Elon's second company, right?

And they're doing things that no country has ever pulled off before. And I sent out a tweet at the time. I just thought in my head, like, do the people who are shorting Elon watch these SpaceX launches and really kind of process the guy that they're up against? I'm not an Elon fanboy at all. I do admire his companies, but the one thing I've learned is that he does not treat business just as sort of his job. I mean, for him, this stuff is war, and when I hear some of these other CEOs speak, I just don't think they fully know what they're up against.

In the case of Tesla Motors, you have an automotive company that is quite different from traditional automakers, but in terms of measuring its business success, a lot of the metrics are the same. SpaceX, on the other hand, as you said, just successfully landed a reusable rocket. How do we gauge the success of SpaceX over the next five years? Well, it's sort of funny, because SpaceX is probably the riskiest business Elon's ever done. And then, oddly, it's ended up being, you could argue, his most consistent performer. They essentially play in this market. They don't do space tourism.

They do commercial space, so sending up satellites and refueling the International Space Station. And they are today the low-cost provider for this. So they charge about $60 million to get something in space. Their American competitors, Lockheed and Boeing, charge about $300 million for the same service. And then SpaceX is even cheaper than the Europeans and the Russians, which is quite a feat. And so you can go on their website and look at their backlog of orders. It now stretches out two or three years with dozens of customers and is up in the range, I think, of about $4 or $5 billion of orders. It's a private company.

Elon says they make a profit on each launch, although some people are kind of skeptical about that. But as far as judging the health of the business, as long as they can meet this backlog of orders, they're going to do really well. The problem is the company has not been as consistent as it really should be about launching at least once a month. And this year they want to get up to about 16 launches for the year, which would make them the leader in the field if they could actually pull that off. But, you know, SpaceX, there's no one that's close on price. So if they can do what they say they can do, they will do just fine. Musk is famous for having said that he wants to die on Mars, just not on impact. Does he have a date in his, not a date, but does he have a range of years that he's looking at that he thinks, you know what, in this five-year time frame, we can make a manned trip to Mars?

Yeah, I mean, this is where things start to get a little crazy. You know, so SpaceX thinks that by 2025 we should at least have a spaceship that can get to Mars and would be attempting to make that flight. In Elon's grand vision of the world, what happens is every time Mars and the Earth are relatively close together, which happens about every two years, you would want to send up hundreds, if not thousands, of rockets over about a one-month span. And he wants those rockets to be taking thousands of pounds of equipment to Mars and then eventually to send humans up there to assemble all the equipment and create a colony.

This vision that he has, so in 2025, we sort of get to Mars for the first time, And then he thinks, you know, it's like a 20, 30-year process of doing all of these missions to Mars to build a colony. And then he told me in the book, I mean, he could sort of see himself retiring there in his 70s. He's 44 now, so to say, you know, 30 years. I'm a rocket man. Rocket man. Burning out his fuse all day long. Coming up more with Ashley Vance.

stay right here. This is Motley Fool Money. Welcome back to Motley Fool Money. I'm Chris Hill, talking with Ashley Vance, author of the bestseller, Elon Musk, Tesla, SpaceX, and the Quest for a Fantastic Future. To this point, Elon Musk has tackled four very large and very entrenched industries, and he has done so with success. We've talked about automotive and space travel. There's energy distribution with SolarCity. There's banking with PayPal. I'm sure he doesn't have the time to disrupt a fifth industry, but you've studied him up close. If you get to wave a magic wand, what industry would you like to see Elon Musk take a crack at? I mean, he does talk a little bit about, you know, automotive is obviously part of

transportation but he's he obviously floated this idea of the hyperloop this incredibly fast elevated train i guess you could think about it that would go much faster than high-speed rail he talked to me about wanting to build a vertical takeoff all-electric jet so if you had a meeting in manhattan you'd just be able to land this thing on the top of a building or a small runway hop into your meeting and then scoot out and so transportation is obviously a hub I get all these emails from people that wish he was into biotech

and could dedicate his energies to making us live longer and healthier but for some reason that's just never seemed to be like a real calling for him so I can't see him getting into it I think he's a physicist at heart and so

I think anything he does is going to evolve around big machines and materials But, you know, personally, if we end up with the Hyperloop and I can get from San Francisco to L.A. in half an hour on a train, I'll take that. You've written for a number of publications. You're currently writing for Bloomberg Businessweek, and you're working on a new video series I wanted to ask you about on Bloomberg.com entitled Hello World, in which you say you're looking for the most innovative technologies and the beautiful freaks behind them. So I started watching the first episode, and I was immediately drawn in. First, if you could share just a little bit about the process behind this series,

what you were thinking about in terms of where you wanted to go, and let's start with New Zealand. Yeah, sure. Well, I guess the whole idea for this show came out of my work at Business Week, and I just kept traveling outside of Silicon Valley where I live and seeing just this incredible influx of really amazing technology. And so I decided to try, well, I managed to convince Bloomberg to let me play Anthony Bourdain for a little while and instead of food, focus on technology.

And so each episode is a different country. We start in New Zealand. We see this crazy artificial intelligence baby that can talk and read and respond to you. There's a company called Rocket Lab that is actually going to soon probably rival SpaceX on the very low end of getting things to space. And the future episodes, we're going to – I just got back from Israel. I'm going to Iceland next week, and there's going to be 10 episodes that look at what's going on in each of these countries. And, you know, it's just a really interesting time. I think Silicon Valley dominated tech so heavily for so long, and it's still definitely the hub.

But these other countries are doing amazing things, and each one has their different spin on their tech culture and the way they're shaping our future. You can follow him on Twitter. Check out his new video series on Bloomberg.com. And the New York Times bestseller is Elon Musk, Tesla, SpaceX, and the quest for a fantastic future. Ashley Vance, thank you so much for being here. Thanks so much for having me. I really enjoyed it. And we've got a free site for our Motley Fool Pro service that's run by Jeff Fisher.

you can find it by going to trypro.fool.com. There's free research reports, several stock trades that Jeff and his team have written up. So, check it out. Just go to trypro.fool.com. That's going to do it for this week's edition of Motley Fool Money. Anne Henry helping out behind the glass this week. Our engineer is Steve Broido. Our producer is Matt Greer. I'm Chris Hill. Thanks for listening, and we'll see you next week.