SpaceX has slipped below its much-hyped $135 IPO price, and down 40% from the all time high hit during the June 15th gamma squeeze when the stock surged above $220 if ovenright trading, an "inevitable outcome" according to Bloomberg, which lends some validation to the skepticism surrounding "a valuation that always relied more on imagination than observable fundamentals."

Wall Street’s price target estimates spanned from roughly $60 to $800 (from Raymond James), a forecast that was 5x above the IPO price...

... a remarkable range that underscored just how little conviction existed around intrinsic value, and where all the upside is based on the Musk "story.".

As Bloomberg's Brendan Fagan writes, "when analysts cannot even agree within hundreds of billions of dollars on what a company is worth, valuation becomes an exercise in storytelling rather than finance." Not like that should have been a surprise: after all, this was expected from the journey that Tesla shares have been on.

While the recent price action does not settle the debate over SpaceX’s long-term potential, but it does suggest the market is becoming less willing to pay almost any price for that uncertainty.

But while the SPCX stock price is notable, the real story is not in the stock but rather the company's brand new $25BN bonds due 2056, which have been a one-way street lower since breaking for trade on June 24...

... and which now yield a junkbond-esque 7.5%. 

The issue here, no pun intended, is that the rout of particular bond has pushed the Goldman hyperscaler bond basket to a new record wide as we noted earlier... 

... and prompted Bloomberg to paraphrase what we said over the weekend, in its "Before the Bell" this morning, writing that "Signs of Hyperscaler credit stress has reached the highest since Goldman Sachs launched the basket in February. The data-center building boom has sparked an explosion of debt funding, with investors not paying enough attention to the terms of their lending."

For those who missed it, here is our article from this weekend "Carnage" In The Hyperscaler Bond Market: Did Goldman Just Pop The AI Debt Bubble, in which we explained that the bond market is almost at capacity, and will barely be able to digest any more bond issuance. Which, in a world where trillions in future capex have to be funded almost entirely by new debt issuance...

... is suddenly a very big problem.