E114: Markets update: whipsaw macro picture, big tech, startup mass extinction event, VC reckoning

**Jason Calacanis** (0:00)
All right, everybody. Welcome to the All-In Podcast. We're back.
Thanks to Friedberg and Sacks for moderating the show into the lowest ratings in its history.

**Chamath Palihapitiya** (0:13)
Hold on, hold on. Please give the keyboard warriors that are their bot armies some respite here. They tried their best.

**Jason Calacanis** (0:20)
They just did. It's okay.

**David Sacks** (0:22)
I think the ratings of the last episode must be a result of Google downranking us as a result of our honesty about not wanting to get more boosters.

**David Friedberg** (0:30)
Sacks, you're on the Brigadoon track.

**David Sacks** (0:32)
It caused somebody at Google, some lower level functionary to push a button.

**Jason Calacanis** (0:36)
Push a button.

**David Sacks** (0:37)
To shadow ban, I mean, visibility filter us.

**Chamath Palihapitiya** (0:39)
It's everything except the moderation skills of the two Davids.

**Jason Calacanis** (0:42)
The moderator turning it into Fox Sunday. The reaction I got from our COVID vaccine discussion was, hey, pretty fair and balanced, like not in a joking way, but like actually like.

**Chamath Palihapitiya** (1:09)
Yeah, the warning on YouTube was pretty benign actually.

**Jason Calacanis** (1:11)
Yeah, it's like, if you want COVID information, click here. Thank you. Okay, let's talk about the market data. The Fed raised 25 basis points. The market obviously has ripped since then. The jobs data this morning was crazy. We added 517,000 jobs more than 2X December, and well above the estimates of 188,000 jobs.
The Fed, I think, is starting to realize they can obviously impact inflation and slow down. Speculative assets, but they're having a very hard time with the labor market. Obviously, labor participation actually is growing. We've talked about that many times here. It's bumped up to 62.4%. We all know it peaked at like maybe 69% during the 2000 time period.
Wage growth, though, continuing to slow, so that is some good news there.
And obviously, risk on assets are ripping the last couple of days. Chamath, what's your take on where we are with the market and the Fed's action, which people are starting to believe will be another 25 basis point hike and then maybe staying high for the rest of the year? Did you hear their comments? You think dovish? What's your take on the market?

**Chamath Palihapitiya** (2:22)
I watched Powell's speech, and it was really amazing because...
In December, he was extremely hawkish, and he was basically like, listen, we're going to keep rates higher than you like and longer than you want. That was pretty clear and the markets reacted.
Then not but 35, 40 days later, he essentially said we have two 25 basis point hikes left to go, and he's going to try to stick the landing essentially. Even though the rest of the language in his entire speech and the press conference, if you read it in the absence of his body language, so if you just read the transcript, would seem very hawkish as well. But the reality was he basically capitulated, and then the market essentially said, okay, we're at the end of this thing. We've talked about this before, but markets tend to bottom six to nine months before, it's clear that you could have done this. We're a little bit off to the races in the short term. It's compounded by a couple of other factors. One is that at the end of last year, so many people were tax loss harvesting, which means if you had some gain somewhere else, you sold some things that were losing money so that you could net the two together. You saw a lot of stocks. Tesla was probably the poster child for this. Trade all the way down to like $108 a share, and it's effectively doubled in the last 30 days. So everybody tax loss harvested, everybody degrossed, nobody was really owning anything. And then when Powell basically said, we're mostly done, there's been so much systematic buying right now that nobody's really well positioned. To me, this is very similar and eerily reminiscent of the end of 2018 and beginning of 2019 And if you guys remember, at the end of 2018, October, November, December, the markets just fell.
And part of it was Powell's gonna raise rates, inflation's getting out of control, et cetera, et cetera. And then we got all this data that said China may be entering a real period of malaise, and Powell capitulated, again, trying to stick the landing. And long story short, he didn't. That was a head fake, and the markets just ripped higher. Then we went into the COVID pandemic and all of that stuff happened. So I think we're about to replay a little bit of that, at least in the next 30 to 90 days.