E162: Live from Davos! Milei goes viral, Adam Neumann's headwinds, streaming's broken model, microplastics & more

Interest‑rate side of the condition was met (no ~150 bps of cuts)
• At the start of 2024, the federal funds target range was 5.25%–5.50%. It stayed there until September 18, 2024, when the Fed cut by 50 bps to 4.75%–5.00%, then cut by 25 bps in November to 4.50%–4.75%, and again by 25 bps in December to 4.25%–4.50%. That’s 100 basis points of easing in 2024, not the roughly 150 bps Sacks cited as the market’s expectation. (investinglive.com)
→ So the antecedent of his conditional (“if rates don’t come down as expected (~150 bps) in 2024”) did occur.

Commercial real‑estate sponsors did see broad distress
• By year‑end 2024, CMBS data show office and multifamily borrowers under significant strain: Trepp reports the overall CMBS delinquency rate at 6.57%, with office delinquency at a record 11.01% in December 2024 and more than $2 billion of office loans becoming newly delinquent that month alone. (trepp.com)
• KBRA finds office delinquencies in its CMBS universe more than doubled year‑over‑year to 10.76%, with an office “distress rate” (delinquent + specially serviced) near 15% by December 2024, and $2.5 billion of loans added to distress that month, over half due to actual or imminent maturity default. (businesswire.com)
• The Financial Stability Board likewise noted that, as of September 2024, distress was “evident in multiple segments” of the CMBS market, with office and retail segments showing the highest distress rates. (ft.com)
→ This supports the idea that a large number of commercial real‑estate sponsors were indeed “in trouble” by late 2024.

But a large number of regional banks did not end up in serious distress in 2024
• FDIC data show only two U.S. bank failures in all of 2024: Republic First Bank (Philadelphia, ~$6B in assets) on April 26, and First National Bank of Lindsay (Oklahoma, ~$108M in assets) on October 18. (fdic.gov)
– The First National Bank of Lindsay was closed after regulators found “false and deceptive bank records” and suspected fraud that depleted its capital—i.e., primarily a fraud/management issue, not a CRE‑rate shock story. (occ.treas.gov)
– Republic First’s failure was tied to longer‑running profitability, funding, and interest‑rate pressures; news coverage frames it as one more isolated smaller‑lender failure, not part of a broad wave of regional bank collapses. (forbes.com) • The FDIC’s Q3 2024 update reported 68 “problem banks” on its list—up, but still a historically moderate share of the thousands of U.S. banks. The same report emphasized that the sector’s capital and overall resilience remained solid, even as non‑performing CRE loans rose to their highest level since 2013. (reuters.com)
• S&P Global Market Intelligence’s 2024 CRE outlook described banks as “feeling stress but weathering the storm.” Its analysis of roughly $950 billion of CRE mortgages maturing in 2024 concluded that while banks with heavy CRE exposure would “feel some pain,” it was not expected to trigger large‑scale deleveraging or threaten overall financial stability. (press.spglobal.com)
• Credit‑rating agencies did flag and downgrade several CRE‑heavy regionals (e.g., Moody’s putting at least six regional banks on review, and S&P revising outlooks to negative for five others), citing ongoing asset‑quality and profitability pressure from CRE. But these are dozens of institutions out of a large regional‑bank universe, and the typical language is about elevated risk and earnings pressure rather than imminent failure or wholesale restructurings. (investmentnews.com)
• Trade and industry pieces near year‑end 2024 characterize regional banks as under “pressure” and increasingly modifying CRE loans, but they frame problems as building into 2025 (with a big 2025–26 maturity wall) rather than a 2024 wave of bank distress. (credaily.com)
→ In other words, there was notable stress, downgrades, and caution around CRE‑heavy regionals in 2024, but not a large‑scale crisis where “a lot” of regional banks entered serious financial distress (defaults, forced restructurings, or FDIC resolutions) during that calendar year.

Overall assessment
• The if part of Sacks’s conditional is satisfied: the Fed did not deliver the ~150 bps of 2024 cuts that markets had anticipated—only about 100 bps. (foxbusiness.com)
• The then part is mixed: commercial real‑estate sponsors—especially office borrowers with floating or maturing debt—were clearly under broad, measurable stress by late 2024. (trepp.com)
• However, the specific follow‑through he predicted—“and in turn there’s a lot of regional banks who are in trouble” in 2024—did not materialize at the scale implied. Actual 2024 bank failures were few and idiosyncratic, regulators and analysts repeatedly described the banking sector as generally resilient, and CRE‑related problems were framed more as a rising risk and future‑default pipeline than as a contemporaneous wave of serious regional‑bank distress.

Because his conditional hinges on both widespread sponsor trouble and a resulting wave of regional‑bank distress in 2024, and the second component did not occur in that year, the prediction is best judged as wrong overall, albeit directionally right about mounting CRE sponsor stress and elevated risk for CRE‑heavy regional banks.

As of late 2025, the prediction’s main time horizon (“over the long term,” roughly the next decade) has not played out yet, so it’s too early to judge the core claim about where subscriber counts and business models will settle.

Subscribers:

• Netflix has already surpassed the lower end of the 300–500 million range, with around 301–302 million paid memberships by the end of 2024 and estimates of ~310 million in early 2025, so the scale Jason envisioned for Netflix looks plausible and in some sense already realized. (cnbc.com)
• Disney+ remains far below that range, with roughly 131–132 million global subscribers as of Q3 2025, though it is still growing.(streamingbetter.com) Long‑range industry forecasts currently project Disney+ at under 200 million subscribers by 2029 (around 192–196 million), which is well short of 300 million but still leaves several years beyond 2029 before the end of the “next decade” window.(whatsondisneyplus.com) So it’s impossible yet to say definitively whether Disney+ will ever reach the 300–500 million range or not.

“Money printing machines” and content spending:

• Netflix and Disney’s streaming businesses are becoming strongly cash‑generative. Netflix is guiding to about $9 billion in free cash flow for 2025, which is consistent with Jason’s idea that mature, scaled streamers can throw off substantial cash.(tipranks.com) Disney’s direct‑to‑consumer segment (Disney+, Hulu, ESPN+) has moved from large losses to sustained quarterly operating profits in 2024–2025, with hundreds of millions of dollars of operating income and a stated goal of roughly $1 billion in streaming profit for fiscal 2025.(cnbc.com) This directionally supports the “money printing” part, though it’s still early.
• However, the claim that these services “won’t need a ton of new content” is not borne out so far. Netflix is increasing its content budget, planning to spend about $18 billion on content in 2025 (up from ~$16.2 billion in 2024), and management explicitly says they are “not anywhere near a ceiling” on content spend.(hypebeast.com) Disney likewise continues to invest heavily in new originals and sports rights to fuel Disney+ and Hulu. Profitability is improving, but it is not coming from a dramatic pullback in new content; rather, it’s coming from a mix of price hikes, ad tiers, and more disciplined spending.

Because:

• Netflix has hit the predicted scale but Disney+ has not, and forecasts are uncertain;
• both services are trending toward being highly cash‑generative, partially validating the “money printing” idea;
• yet their ongoing large content investments undercut the specific notion that they will not need much new content;
• and, crucially, we are less than two years into a roughly ten‑year prediction window,

the overall outcome of Jason’s long‑term prediction cannot be definitively labeled as right or wrong at this point. It is therefore best classified as inconclusive (too early).

Jason’s prediction was that there would be “massive consolidation” in streaming, leading to a materially smaller number of major services over the coming years (a multi‑year horizon beyond early 2024).

By November 30, 2025, we do see meaningful consolidation activity, but not yet a clear, large reduction in the number of major global streaming services:

• In India, Disney+ Hotstar and JioCinema were merged into a single platform, JioHotstar, eliminating JioCinema as a standalone service and creating a dominant joint venture (JioStar). (en.wikipedia.org)
• Paramount completed an $8.4 billion merger with Skydance in August 2025, with the new leadership planning to bring Paramount+, Pluto TV, and BET+ onto a single tech stack and to combine Paramount+ and Pluto TV into a single direct‑to‑consumer service, which would reduce the number of separate Paramount-owned streaming offerings once fully implemented. (reuters.com)
• Disney and Fubo agreed to merge Fubo with Hulu + Live TV under Disney majority control, creating a larger combined live-TV streaming operation, even though both brands remain available as separate offerings for now. (en.wikipedia.org)
• Major U.S. and global on‑demand services like Netflix, Disney+, Hulu (increasingly integrated into Disney+ but not yet fully merged at the product level), HBO Max/Max, Paramount+, Peacock, Apple TV+, and Prime Video are all still operating as distinct services and are actively marketed in 2025 Black Friday promotions and bundles. (theverge.com)
• Further large‑scale consolidation is being actively explored: Warner Bros. Discovery has begun a breakup and sale process, soliciting bids from Paramount Skydance, Comcast, and Netflix, with scenarios that could combine HBO Max with Paramount+ and reshape the competitive landscape, but these transactions have not yet closed. (reuters.com)

So far, the industry is clearly moving toward consolidation (corporate mergers, service mergers like JioCinema + Disney+ Hotstar, and deeper bundling and integration among U.S. players), but as of late 2025 there is not yet an unequivocal “massive” shrinkage in the number of major global streaming services Jason was talking about. Because his prediction explicitly refers to the coming years and that period extends beyond 2025, and because ongoing deals could still dramatically change the count of major services, it is too early to say whether his forecast of a materially smaller field of major streamers will ultimately prove right or wrong.