ALL INPredictions
Last updated Nov 29, 2025
Prediction
Chamath
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Chamath @ 00:22:18Wrong
economygovernment
As a result of the spike in energy prices associated with the Russia/Ukraine crisis, the U.S. (and likely broader developed-world) economy will enter a recessionary contraction, prompting governments/central banks to shift toward more accommodative policies (easier monetary or fiscal stance) within the subsequent 12–18 months (i.e., by late 2023).
We will contract as an economy. The government will have to become more accommodating.View on YouTube
Explanation

Chamath’s prediction tied the Russia/Ukraine-driven energy shock to two concrete outcomes within roughly 12–18 months (by late 2023):

  1. A recessionary contraction in the U.S. (and likely broader developed world).

    • United States: Official BEA data show real U.S. GDP grew 1.9% in 2022 and 2.5% in 2023; measured Q4‑to‑Q4, GDP rose 0.7% in 2022 and 3.1% in 2023, not a contraction. (bea.gov)
    • The NBER, the body that dates U.S. recessions, lists no new peak or recession after the April 2020 trough; there is no declared U.S. recession in 2022 or 2023, even though there were two negative GDP quarters in early 2022. (nber.org)
    • Broader developed world: The European Commission reports euro‑area and EU GDP grew in 2022 (about 3.5%) and remained positive, though weak, in 2023 (around 0.6–1.1%), explicitly noting that the EU “set to avoid recession” despite the energy crisis. (economy-finance.ec.europa.eu)
    • OECD data show OECD‑wide and G7 GDP still expanding (about 0.4% q/q in Q4 2023), with only some member countries in mild contractions, not a broad developed‑world downturn driven into recession. (oecd.org)

    These data contradict the claim that the U.S. economy, and the developed world as a whole, moved into a clear recessionary contraction in that window.

  2. A shift to more accommodative policy within that window.

    • Monetary policy in the U.S.: The Federal Reserve raised the federal funds rate from near 0% in early 2022 to 5.25–5.50% by July 2023, a cumulative increase of over 5 percentage points, as part of an aggressive tightening cycle to fight inflation. (forbes.com)
    • Monetary policy in the euro area: The ECB raised its key interest rates from negative/zero levels in mid‑2022 to around 3–4% by late 2023, again a forceful tightening in response to high inflation. (ecb.europa.eu)
    • Fiscal stance: EU economic reports note that, by 2023, earlier fiscal support (including energy-related measures) was being phased out, while monetary tightening was “working its way through the economy,” not that overall policy was turning more expansionary. (economy-finance.ec.europa.eu)

    In other words, instead of becoming “more accommodating,” policy in major developed economies became substantially more restrictive through late 2023.

Because (a) no official U.S. or broad developed‑world recession materialized over 2022–23 and (b) central banks moved sharply away from accommodative stances during the 12–18 months after March 2022, the core economic scenario Chamath described did not occur. The prediction is therefore wrong overall.