E98: Big tech starts making cuts, Fed incompetency, global debt, Russia/Ukraine & more

Chamath made this call around the start of October 2022, just after the S&P 500 had broken to new bear‑market lows in late September.

S&P 500:

• The podcast date is Oct 1, 2022 (a Saturday), so the relevant nearby trading close is Oct 3, 2022, when the S&P 500 closed at 3,678.43. StatMuse’s October 2022 data shows this close on Oct 3. (statmuse.com)
• The ultimate bear‑market closing low for the S&P 500 in that cycle was 3,577.03 on Oct 12, 2022, about nine days later. (statmuse.com)
• From 3,678.43 (Oct 3) to 3,577.03 (Oct 12) is a drop of about 2.8%, slightly under his 3%–5% band; using the intraday trough the next day (low 3,491.58 on Oct 13), the maximum drawdown from Oct 3 was about 5.1%, right in his 3%–5% range. (statmuse.com)
• The prior cycle high was about 4,796 on Jan 3, 2022, so by early October the S&P was already more than 20% below the high but only a few percent above the eventual low, meaning it was clearly “closer to the lows than the highs.” (statmuse.com)
• Later reporting from Reuters and Axios explicitly notes that the bear market ended at the Oct 12, 2022 low and that the index has been in a bull market since then, with new record highs set in January 2024. (investing.com)

Nasdaq Composite:

• On Oct 3, 2022 the Nasdaq Composite closed at 10,815.43. (statmuse.com)
• Its cycle closing low came later at 10,213.29 on Dec 28, 2022, which is about 5.6% below the Oct 3 close—again, only a mid‑single‑digit downside from early October. (statmuse.com)
• The prior record high near 16,057 in November 2021 means that, by early October 2022, the Nasdaq was much closer to that future low than to its old high. (statmuse.com)

Bottoming / consolidation and cycle context:

• No major U.S. index has traded below those Oct–Dec 2022 lows since; instead, the S&P 500 and Nasdaq have gone on to make new all‑time highs in 2024–2025, confirming those levels as the cycle bottoms. (investing.com)

Putting this together: from early October 2022, broad U.S. equity indices had only about 3–6% further downside to their ultimate bear‑market lows, and those lows marked the start of a new bull market. That matches Chamath’s claim that markets were bottoming, consolidating, closer to their lows than to their highs, with only ~3–5% further downside remaining. Hence the prediction is best classified as right.

Most data and official assessments indicate the U.S. did not experience a broad-based recession or a “hard landing” in 2023.

Key points:

1. No official 2023 recession call
   The National Bureau of Economic Research (NBER), which is the standard arbiter of U.S. recessions, has not dated any recession beginning or occurring in 2023; the most recent recession it recognizes is the COVID downturn of February–April 2020.【】

2. Positive real GDP growth in 2023
   U.S. real GDP grew throughout 2023 rather than contracting. Bureau of Economic Analysis data show real GDP increasing for the year (annual growth around 2–3%, depending on measure), not the sustained contraction typical of a broad-based recession. (Multiple BEA releases for 2023 confirm positive quarterly growth.)【】

3. Labor market remained strong
   The unemployment rate stayed historically low through 2023 (roughly in the 3.4–3.9% range), and payroll employment continued to rise, which is inconsistent with a classic hard-landing recession characterized by broad job losses.【】

4. Soft‑/no‑landing narrative by late 2023
   By late 2023, many major financial press and economic commentators described the U.S. outcome as a soft landing or even “no landing,” emphasizing slowing inflation without a deep downturn, rather than a hard-landing recession. Fed officials themselves increasingly referenced the possibility that a soft landing had been or might be achieved.【】

Because the prediction was specific to 2023 and called for a broad-based recession with a hard landing, and the observable macroeconomic outcomes showed continued expansion, low unemployment, and no NBER recession in that year, the prediction is best classified as wrong.

Sacks is endorsing Stanley Druckenmiller’s 10‑year outlook from roughly October 2022 to around October 2032. We are only about three years into that window, so the core claim (where the Dow will be in 2032) simply cannot be tested yet.

For context:

• Around the end of October 2022, the Dow closed at about 32,733 (October 31, 2022). (statmuse.com)
• As of late November 2025, the Dow is around 47,700, having hit multiple new record highs and showing an 11.9% gain for 2025 and substantial gains since 2022. (statmuse.com)

Even though the Dow has risen well above its 2022 level so far, Druckenmiller’s and Sacks’s prediction is specifically about the level in 2032, not about the path along the way. With roughly seven years left in the forecast horizon, it’s too early to label the prediction as right or wrong.

Data for 2023 show neither the U.S. nor the world economy experienced a hard‑landing recession:

• The U.S. economy grew in 2023: real GDP rose 2.5% for the year, with all four quarters positive, according to the Bureau of Economic Analysis. (bea.gov)
• The National Bureau of Economic Research, the official arbiter of U.S. recessions, has not dated any new recession after the April 2020 trough, meaning the period through 2023 is still classified as an expansion. (nber.org)
• The labor market remained strong: the unemployment rate averaged about 3.8% in Q4 2023, which the Bureau of Labor Statistics explicitly describes as low by historical standards, not consistent with a hard‑landing downturn. (bls.gov)
• Globally, the IMF’s World Economic Outlook put 2023 world GDP growth around 3.0%, a slowdown but not a global recession. (meetings.imf.org)

One part of the prediction did occur: “something broke” in 2023 in the financial system. The failures of Silicon Valley Bank, Signature Bank, and First Republic were the 2nd, 3rd, and 4th largest bank failures in U.S. history and triggered a recognized “2023 United States banking crisis,” prompting systemic‑risk interventions by the FDIC and Federal Reserve to stem contagion. (fdic.gov)

However, the normalized claim ties that break to the occurrence of a hard‑landing recession in 2023 in the U.S. or globally. Since the dominant economic outcome was continued expansion with relatively low unemployment and no officially recognized recession, the overall prediction—as framed—is wrong, despite being partly right about a significant financial “break.”

Bureau of Labor Statistics data show that the U.S. unemployment rate stayed in the mid‑3% range throughout 2023 (roughly 3.4–3.8% by month) and only edged up to about 4.2% by late 2024, never approaching the 5–6% range Chamath described. (bls.gov) Even by September–October 2025, unemployment is estimated around 4.3–4.4%, still well below 5%. (reuters.com)

On the recession part, the National Bureau of Economic Research’s Business Cycle Dating Committee has not declared any new U.S. recession after the brief COVID downturn that bottomed in April 2020; indicators based on NBER dates show no recession episodes in 2022–2025 to date. (nber.org) This contradicts the “hard‑landing recession around 2023” scenario implied in the prediction.

Chamath also said many companies would “pull way back on their spend.” That aspect is broadly accurate: 2023–2024 saw large cost‑cutting and layoffs across big tech and other sectors (e.g., Amazon, Meta, Alphabet, Microsoft, Salesforce, PayPal, SAP, Wayfair, and others) explicitly tied to expense reduction and weaker demand/over‑expansion. (engadget.com) However, this partial match does not rescue the core forecast, which hinged on a hard‑landing recession and unemployment rising to about 5–6%, neither of which occurred by late 2025. Therefore the prediction is best classified as wrong overall.

The prediction did not come true on either its mechanics or its macro outcome.

1. Mortgage structure and size of the problem

   • In 2022 there were about 924,000 outstanding interest‑only homeowner mortgages in the UK, versus roughly 8.5 million residential mortgages overall – on the order of ~10–11%, not 40% of the market. (credit-connect.co.uk)
   • By Q1 2023, around 87% of the value of outstanding UK residential mortgages was on fixed rates, not adjustable‑rate interest‑only loans, directly contradicting the idea that “40% of all mortgage dollars are interest‑only ARMs.” (bankofengland.co.uk)
   • Trade‑body and FCA data show interest‑only has been a shrinking, niche product (about 3–4.5% of new regulated mortgages in recent years), not a dominant share of the book. (credit-connect.co.uk)

2. Scale and timing of payment shocks

   • The Office for National Statistics and Bank of England both describe the impact of rising rates as spread out over several years, with roughly 1.4 million fixed‑rate deals up for renewal in 2023 and many more through 2024–26, not a single “January 2023” reset event. (ons.gov.uk)
   • Bank of England analysis indicates that for a typical mortgagor rolling off a fixed deal in 2023, monthly payments were expected to rise by around £220 per month (roughly a 35–40% increase), and later work puts average increases closer to 20–40% depending on cohort — substantial, but far from the 3–4× jump implied in the quote. (bankofengland.co.uk)
   • Resolution Foundation and other contemporaneous research framed this as a severe squeeze (e.g., ~£3,000 per year higher costs for millions of households, and a double‑digit hit to real incomes for typical mortgagors), but again not a trebling or quadrupling of mortgage payments for the bulk of borrowers. (theguardian.com)

3. Macroeconomic outcome – was the UK “upside down”?

   • The UK did experience a cost‑of‑living crisis and a shallow recession in the second half of 2023, with GDP falling modestly in Q3–Q4 2023 then recovering, but by later revisions the economy in late 2023 was about 2.2% larger than its pre‑pandemic peak, and 2023 as a whole showed slight positive growth (~0.4%). This is weak performance, not an economic collapse. (wsj.com)
   • Unemployment in 2023 hovered around 4%, close to historic lows, indicating a still‑functioning labour market rather than a systemic breakdown. (ycharts.com)
   • Mortgage arrears did rise to a seven‑year high by Q4 2023, but were about 1.23% of loan balances—well below the 3.6% peak seen after the 2008 crisis—leading regulators to describe households as stressed but broadly resilient, not en masse unable to “keep their homes.” (ft.com)

Overall, the core premises (40% of mortgage balances being interest‑only ARMs all resetting in January 2023) are factually incorrect, the predicted magnitude of payment increases (3–4×) is far above what actually happened on average, and while the UK economy in 2023 was weak and under strain, it did not become "upside down" in the sense of a widespread mortgage‑driven collapse. Hence the prediction is wrong.

Key elements of Chamath’s scenario did occur in the real world, even though some details (like the exact form of the “Fed put”) differed.

1. Rate hikes to ~4.5% “very quickly”
   When the podcast aired (1 Oct 2022), the effective federal funds rate was about 3.1%. It rose to ~4.1% by December 2022 and ~4.6% by February 2023, meaning the Fed did in fact reach roughly 4.5% within a few months. (fred.stlouisfed.org)

2. “Something breaks” in the financial system within months of that level
   After policy rates crossed that range, the U.S. saw the 2023 regional-banking crisis: Silicon Valley Bank failed on March 10, 2023; Signature Bank failed on March 12; First Republic was seized in May. These were among the largest bank failures in U.S. history and were widely tied to losses on long‑duration securities driven by the rapid rate hikes. (en.wikipedia.org)
   Those failures occurred roughly 1–5 months after the funds rate moved into the 4–5% zone, which is within (and earlier than) the 6–9 month window his normalized prediction allowed.

3. Fed intervention via backstops reminiscent of a “Fed put”
   In direct response to this turmoil, on March 12, 2023 the Federal Reserve announced the Bank Term Funding Program (BTFP) to provide term funding against Treasuries and agency securities at par, explicitly to assure banks could meet depositor needs and to stabilize the system. (federalreserve.gov)
   This was a targeted financial‑stability backstop—conceptually similar to the Bank of England’s emergency long‑dated gilt purchases in September–October 2022, which were also temporary, stability‑focused operations rather than broad, open‑ended QE. (bankofengland.co.uk)
   While the Fed did not immediately pivot to rate cuts or full‑scale QE (it actually kept hiking to above 5% and only began easing much later, in 2024–2025), the creation of BTFP and the systemic‑risk guarantees for bank depositors fit the “intervene with backstops” part of his forecast reasonably well. (fred.stlouisfed.org)

4. Equity market bottoming and subsequent surge
   U.S. equities effectively bottomed around October 12, 2022, very near the time of the episode, and then entered a sustained bull market. By July 31, 2023, the S&P 500 was up strongly from that low, and by October 2025 it had risen nearly 90% from the October 2022 bottom, with a widely recognized bull run led by large‑cap tech. (en.wikipedia.org)
   That pattern—bottoming around the period of aggressive hikes and then a powerful rally over the next 2–3 years—matches his claim that we were in a “bottoming process” and that equities would eventually surge after the Fed’s stabilizing response.

Caveats: The Fed’s actions were more constrained and credit‑facility‑based than the almost-immediate gilt‑purchase program the Bank of England ran, and the ensuing bull market was driven by multiple forces (earnings, AI optimism, etc.), not just policy backstops. However, the core sequence he predicted—rapid hikes to ~4.5%, a break in the system, Fed stepping in with backstops, and a strong subsequent equity bull market—did happen, so on balance the prediction is best classified as right, albeit directionally rather than in every specific detail.

Sacks’ core claim was that, from October 2022 onward, the Russia–Ukraine war would not move toward a peace deal but would instead keep escalating because key "off‑ramps" (e.g., compromise over territory, Ukraine’s NATO status, sanctions/energy leverage) had been removed. Looking at October 2022–November 2025, that is broadly what happened.

1. Off‑ramps largely disappeared and no peace deal emerged

• Early 2022 negotiations in Belarus, Turkey, and especially the Istanbul communiqué explored a framework in which Ukraine could forgo NATO membership in exchange for security guarantees, without recognizing Russian annexations. These talks collapsed; a senior Kremlin official later said a draft settlement tying an end to hostilities to Ukraine’s NATO neutrality was blocked by Putin, who expanded his aims to annex more Ukrainian territory. (en.wikipedia.org)
• On 30 September 2022, just before Sacks’ comment, Russia formally annexed four Ukrainian regions (Donetsk, Luhansk, Kherson, Zaporizhzhia), declaring their residents "our citizens forever" in a ceremony widely described as a major escalation and condemned as illegal by 143 UN member states. (en.wikipedia.org) This hardened Russia’s minimum terms (recognition of these annexations) and made territorial compromise far harder.
• After that, Russia insisted any ceasefire or peace required Ukraine to surrender all the annexed regions and accept a permanent bar on NATO membership, plus sanctions relief. (en.wikipedia.org) Ukraine, by contrast, applied for NATO membership and set full Russian withdrawal from occupied territory and robust security guarantees as prerequisites for real talks. (en.wikipedia.org) Those positions effectively removed the mutually acceptable middle ground Sacks was talking about.
• From mid‑2022 through 2024, peace negotiations were largely frozen; meaningful talks only resume in 2025 under U.S. mediation, but even then Russia demands territorial concessions and NATO restrictions that Ukraine rejects, and no settlement is reached. (en.wikipedia.org) The UN General Assembly in February 2025 is still passing resolutions on "advancing a comprehensive, just and lasting peace in Ukraine," underscoring that no deal exists three years after the invasion. (en.wikipedia.org)

2. The war continued with major escalatory phases rather than de‑escalation

• Starting 10 October 2022, Russia launched a sustained nationwide missile and drone campaign against Ukraine’s power grid and other critical infrastructure, knocking out nearly half of Ukraine’s electricity generation by November and repeatedly plunging cities into blackouts. (en.wikipedia.org) This was a clear escalation beyond earlier battlefield-focused strikes.
• The 2022–23 Russian winter offensive, centered on Donetsk, produced the months‑long Battle of Bakhmut, widely described as the longest and bloodiest battle of the war and one of the bloodiest of the 21st century, with extremely high casualties on both sides. (en.wikipedia.org) That is consistent with intensification rather than de‑escalation after October 2022.
• Through 2023–24 and into 2025, large-scale operations continued: battles like Krynky on the Dnipro (2023–24), a new Borova offensive starting December 2024, and the ongoing Pokrovsk offensive from July 2024, where Ukrainian sources say Russia has committed up to ~220,000 soldiers by August 2025. (en.wikipedia.org) This sustained mobilization and series of offensives show the conflict has not settled into a low‑intensity freeze.
• Russian strikes on civilian and energy infrastructure intensified again in 2025. The UN reported that attacks on infrastructure in the first five months of 2025 caused 50% more civilian casualties than the same period in 2024. (en.wikipedia.org) On 3 October 2025, Russia mounted what was described as its most extensive attack of the war on Ukraine’s energy system, using 381 drones and 35 missiles to hit natural gas facilities. (apnews.com) Late 2025 has seen further massive barrages on Kyiv—hundreds of drones and dozens of missiles in single nights—cutting power to half the city and prompting Ukrainian retaliatory strikes deep into Russian territory. (theguardian.com)

3. Assessment relative to the prediction

• Sacks argued that once the possible compromises over NATO status, Donbas/territory, and sanctions/energy leverage were taken off the table, there would be no realistic peace deal and the conflict would "just" keep escalating. From October 2022 to November 2025, there has been no durable ceasefire or peace agreement, bargaining positions have hardened on exactly those axes (NATO, territorial control, sanctions), and the war has remained high‑intensity with repeated spikes in battlefield and infrastructure escalation.
• While the front lines have at times been relatively static, that has coincided with extremely destructive attritional fighting, major new offensives, and record‑scale missile and drone campaigns against infrastructure—not with de‑escalation in any ordinary sense.

Given the continued absence of a peace deal and the pattern of sustained and, in several respects, increasing escalation since October 2022, Sacks’ prediction is best judged as right.

Chamath’s statement is explicitly conditional: market reactions if a Russia–Ukraine–related nuclear incident occurred three months earlier, at the time of the podcast (Oct 2022), and three months later (around Jan 2023). The core event he posits — an actual nuclear incident (use of a nuclear weapon or a radiological/nuclear accident) tied to the war — has not happened.

Multiple overviews of the war and of nuclear risk around it note that, despite extensive nuclear threats and saber‑rattling, no nuclear weapons have been used in Ukraine as of 2025. (nationalsecurityjournal.org) The Zaporizhzhia Nuclear Power Plant has been under occupation and repeatedly shelled, creating an ongoing nuclear safety crisis, but international monitoring and IAEA statements emphasize that the world has so far been “lucky that a nuclear accident hasn’t happened” there – i.e., no major radiological release or accident has occurred. (en.wikipedia.org) Broader surveys of “nuclear risk during the Russo‑Ukrainian war” likewise describe threats and fears rather than any realized nuclear incident. (en.wikipedia.org)

Because the prerequisite event in his prediction (a clear nuclear incident) never occurred in the specified window or since, there is no actual market reaction to observe and compare across his three time points (three months before, at the time of speaking, and three months after). Any judgment about how markets would have reacted remains hypothetical and model‑dependent rather than empirically testable. For that reason, the accuracy of his prediction about relative market reactions cannot be determined from real‑world data and must be classified as ambiguous rather than right, wrong, or merely too early to tell.

As of November 30, 2025, there has been no comprehensive political or diplomatic resolution to the Russia–Ukraine war. Major news and reference sources still describe the Russian invasion of Ukraine as ongoing, with active offensives (e.g., the Kupiansk offensive) and deadly missile and drone strikes continuing into late 2025. (en.wikipedia.org)

While there have been U.S.-brokered ceasefire proposals, partial or time‑limited ceasefire talks, and UN resolutions outlining principles for a future peace, these remain frameworks and negotiations rather than a concluded peace settlement that ends the war. (cnbc.com) Because the condition in Sacks’s prediction (“if Ukraine gets resolved”) has not yet occurred, we have no empirical way to see whether global equity markets would “take off like a rocket” immediately after such a resolution.

Therefore, the prediction cannot currently be scored as right or wrong; it remains untested and is best classified as inconclusive (too early) rather than incorrect.