E163: Market rips, Media RIFs, Texas defies Biden, Fintech reckoning, ARkStorm 2.0 & more

**Chamath Palihapitiya** (0:00)
Is this a real picture? Does this help you? Come on, stop.

**David Friedberg** (0:03)
No, no, no. This is how we did last year.

**David Sacks** (0:07)
Yeah, I recognize the gut. I recognize the gut. Very, it's like a fingerprint.

**Chamath Palihapitiya** (0:13)
You gut printed him?

**Jason Calacanis** (0:15)
You gut printed him?

**Chamath Palihapitiya** (0:17)
Oh my god. Look at this picture. Hold on. It's a disaster.

**David Friedberg** (0:31)
I don't think you guys know there's a treasure trove. You go to Google Images, you type in Phil's name and WSOP.

**Jason Calacanis** (0:36)
Which is the last thing I would ever do.

**David Friedberg** (0:37)
Dozens of these, dozens. Every year he dresses up in some outfit.

**Chamath Palihapitiya** (0:43)
Let me see which ones I like.

**David Sacks** (0:44)
Yeah, the plunging V-line is a little much.

**Jason Calacanis** (0:46)
I could do without the plunge. He does have a perky C-cup, so sometimes you gotta use your assets, Sacks.

**Chamath Palihapitiya** (0:55)
Oh my lord. Nick, pull this one up.

**Jason Calacanis** (1:04)
Oh my god.

**Chamath Palihapitiya** (1:06)
It's just incredible.

**Jason Calacanis** (1:08)
It's Poseidon.

**Chamath Palihapitiya** (1:09)
It's just incredible. It's incredible. Oh, no, wait.

**Jason Calacanis** (1:11)
It's Poseidon's whale. No, it's Poseidon.

**Chamath Palihapitiya** (1:15)
Oh, Phil, we love you. We love you. We love you, Phil.

**Jason Calacanis** (1:18)
And Phil loves attention.
All right, everybody, welcome to episode 163 of The All-In Podcast with me, of course, the Sultan of beep science. We'll find out his crop soon, David Friedberg and David Sacks, the Rain Man himself. And of course, Chairman Dictator. And Chamath Palihapitiya, let's get to work, boys. Tons and tons of interesting topics on the docket. Markets are ripping. Jobs and inflation looking good as the Dow hits an all-time high. Forget about soft landings, boys. Sentiment is now flipping to a market meltup in 2024 The GDP numbers that just came out smashed it. 3.3% year-over-year in the fourth quarter. Expectations were just 2%. Dow and S&P 500 both hit all-time highs in the past week. Dow is above 38,000 for the first time in history. CPI number reasonable of 30 basis points month over month. 3.4% from last year, getting close to that 2% target. And the jobs data beat expectations. 2023 jobs, not so bad at 2.7 million. It's the fifth strongest year for job increases since 2020 Real test will be, of course, this year. We've seen a bunch of layoffs. We'll get to that later. Gas prices plummeted 40% from $5 a gallon in the summer of 2022 Now, just $3 a gallon. And consumers are apparently feeling great about the economy. University of Michigan, which is the most respected report on consumer sentiment, said it increased in the past two months the most since 1991
And the Federal Reserve Bank of New York survey found that Americans' inflation expectations have reached their lowest point in three years. Kalshi is a prediction market I like to use, and it says 37% chance of a cut by March. That's dropped, so people are thinking the rate cuts are going to get pushed back. And prediction markets also think four to five rate cuts still in 2024 But again, people seem to think they're going to get pushed towards the spring or second half. Chamath, you alluded to this melt up. I don't know, was it like three or four episodes ago that we might have a chance of a market melt up? Everything seems to be aligning here. What do you think?

**Chamath Palihapitiya** (3:42)
I think the important thing to note is that Tesla put out a pretty important missive at the end of market close yesterday, which essentially said that expect a very different demand curve in Q1. And you have to understand that Tesla has done the best job of understanding supply demand and their pricing power and the pricing elasticity of their cars. And so the fact that they put this out, to me, says that we are now really in the belt-tightening phase of this kind of economic process. So I think that the next probably six to nine months are more of these kinds of things, where folks realize that the amount of discretionary income that people had is less. They will either lower prices or lower expectations.
And so the thing is, and what happens to the market, this is sort of why about a month ago, when we on the pod, I was kind of like, we're going to be in a melt-up. And it's because the economy will cool, demand will cool, inflation cools, rate cuts come in. And again, it's not really worth debating whether it happens in six months or nine months. But when we look back 18 to 24 months from now, the market will probably be materially higher because there's just so much money on the sidelines. And that just continues to grow and grow and grow. So trillions of dollars on the sidelines, cooling economic consumption actually on the ground meets reasonable to resetting to lower expectations for some of these companies. I think that all roads lead to a continued melt up.