Market rips, Media RIFs, Texas defies Biden, Fintech reckoning, ARkStorm 2.0 & more

The cold open is jokes about photos of Phil in annual costumes, easy to find in an image search of his name. It makes no argument and ends with the hosts saying Phil loves attention.

Jason lists good numbers: fourth-quarter GDP of 3.3% against 2% expected, the Dow above 38,000, CPI at 3.4% year over year, 2.7 million jobs added in 2023, and gas down from $5 to $3. University of Michigan sentiment rose the most over two months since 1991, and New York Fed inflation expectations hit a three-year low. Kalshi priced a 37% chance of a March rate cut.

Chamath reads a Tesla note on weaker first-quarter demand as the start of belt-tightening. He still expects cooling demand, rate cuts and cash on the sidelines to lift the market materially within 18 to 24 months. Jason's own conclusion is transcribed as a continued meltdown, which clashes with that melt-up logic and may be a transcription error.

we are on track here for the soft landing, it seems like

Sacks adds risks: the Fed ending its Bank Term Funding Program on March 11 could expose regional banks, China is propping up its stock market, and a wider war involving Iran could spike oil.

Friedberg shows Krugman's unemployment-inflation chart breaking after COVID. He links this to federal debt rising from $22 trillion at the end of 2019 to $34 trillion, which filled the pandemic hole and inflated financial assets.

With average interest near 3%, up from about 1.5% in 2020, annual interest runs near $1 trillion, and each extra point of rates costs about $1 billion a day. The speakers say a $2 trillion deficit persists and asset prices must stay high because pensions and home values are leveraged.

Chamath asks whether rates will sit between 2% and 4% for years, a regime most working-age people have not built businesses in, and ties it to gross margin decay and governments limiting winners.

Sacks expects frothier markets as rates fall, but not a repeat of 2020 to 2021, when about $7 trillion was added to the debt. Another speaker says the 10-year yield may stay near 4%, keeping capital scarcer and valuations lower.