Chamath @ 00:06:47Right
economymarkets
In the September 2024 FOMC meeting, the Federal Reserve will very likely begin cutting rates, with substantial pressure for a 50 basis point cut, and sufficient data-based justification that a 50 bps cut is more likely than previously assumed 25 bps.
yeah. I mean, I think the economy is a lot slower than what people thought. Which to your point, the silver lining is that it probably now tips the balance of action in September to a cut. And if it was 25 basis points, there's probably going to be a lot of folks lobbying the fed to cut 50. And I think that they probably have enough numerical justification now to cut 50.
Explanation
The September 2024 FOMC meeting concluded on September 18, 2024. In its statement that day, the Federal Reserve announced it was lowering the target range for the federal funds rate by 50 basis points, from 5.25–5.50% to 4.75–5.00%. Multiple major outlets and the Fed’s own release confirm that:
- The Fed’s September 18, 2024 statement notes that the Committee decided to lower the target range for the federal funds rate to 4-3/4 to 5 percent, which is a 50 bps cut from the prior 5-1/4 to 5-1/2 percent range.
- Coverage from major financial media the same day explicitly describes this as a half‑percentage‑point (50 bps) rate cut at the September 2024 meeting.
Chamath’s normalized prediction had three key elements:
- "In the September 2024 FOMC meeting, the Federal Reserve will very likely begin cutting rates" – This is correct: the Fed did in fact begin cutting rates in that meeting; it was the first cut of the cycle after holding rates steady for an extended period.
- "with substantial pressure for a 50 basis point cut" – Going into the meeting, market commentary and research pieces widely debated the possibility of a 50 bps cut versus 25 bps, with many arguing for a larger move based on softening economic data and labor‑market revisions; that constitutes “substantial pressure” in common financial-market terms.
- "and [they] probably have enough numerical justification now to cut 50" – The Fed ultimately did choose 50 bps, implying that, in its judgment, the data did justify that magnitude of easing.
Because the Fed at the September 2024 FOMC meeting did start the easing cycle and did implement a 50 bps cut (the scenario Chamath framed as the now-likely and data‑justified outcome), the prediction is right.
(Sources: Federal Reserve September 18, 2024 FOMC statement and contemporaneous financial‑press coverage confirming a 50 bps cut at that meeting.)