Sacks @ 00:45:53Wrong
economy
As a result of COVID-19, US unemployment will rise from around 15% toward 25–30%, and US GDP in the next reported quarter (Q2 2020) will contract by approximately 25–33% on an annualized basis.
you've got, you know, like a 15% unemployment rate going to going to 25 or 30, maybe as high as that. We don't know yet. You've got a you know, we think that GDP is going to contract in the next quarter by a quarter to a third.View on YouTube
Explanation
What was predicted
David Sacks forecast that, due to COVID‑19:
- U.S. unemployment would rise from around 15% toward 25–30%.
- U.S. real GDP in the next reported quarter (Q2 2020) would contract by about 25–33% at an annualized rate.
What actually happened
-
Unemployment:
- The official U.S. unemployment rate (BLS U‑3) peaked at 14.7% in April 2020, then fell to 13.3% in May and 11.1% in June, never reaching the 25–30% range Sacks described. (bls.gov)
- The BLS noted misclassification issues that likely understated unemployment by about 5 percentage points in April and May, implying a true rate around 19–20% at the peak, but still far below 25–30%. (forbes.com)
- No standard unemployment measure (U‑3, or the broader U‑6) approached 25–30%; U‑6 was about 22.8% in April 2020. (cnbc.com)
-
GDP contraction (Q2 2020):
- The Bureau of Economic Analysis reports that real GDP decreased at an annual rate of 31.4% in Q2 2020, squarely within Sacks’s projected 25–33% contraction band. (apps.bea.gov)
Assessment
The forecast was a conjunction: unemployment rising from ~15% to roughly 25–30%, and GDP in Q2 2020 contracting by ~25–33% annualized. While he was very accurate on the GDP contraction, the unemployment call was materially off; unemployment peaked well below his 25–30% range on any standard measure.
Because the unemployment portion clearly did not come true, the combined prediction is best classified as wrong overall, albeit with a correct GDP sub‑prediction.