All-In E196: Big Fed rate cuts, AI killing call centers, $50B govt boondoggle, VC's rough years, Trump/Kamala
Episode 196 • 9/20/2024
Fed Rate Cuts & Market Impact
- Fed cut rates by 50 basis points, first cut since March 2020
- Fed chairman Powell indicated inflation is coming down to target 2% level
- Historical analysis shows mixed market performance after 50bp cuts:
- 2001/2007: Markets fell 26-31% in following two years
- 2020: Markets rose 44% over two years (with COVID stimulus)
- Discussion around whether aggressive rate cuts signal recession concerns despite Powell's positive economic commentary
AI Disrupting Call Centers
- Agreement that Level 1 customer support will be largely replaced by AI within 2-3 years
- Key factors enabling this:
- Large training datasets from existing customer interactions
- Improving voice AI capabilities (referenced OpenAI's audio API)
- Acceptable error rates with failover to human agents
- Noted that customers often prefer automated solutions over human interactions
Government Waste & Political Retaliation
- Discussed $50B programs for rural broadband ($42B) and EV charging ($7.5B)
- Zero rural connections made and only ~8 EV chargers built in 1000 days
- Panel criticized rejection of Starlink for rural broadband despite its proven capabilities
- Argued this represents political retaliation against Elon Musk rather than merit-based decision making
Venture Capital Challenges
- Data shows declining success rates for first-time fund managers
- Extended timeframes needed for startup exits (often 10+ years vs traditional fund lifetimes)
- Impact of 2020-21 bubble on valuations and return expectations
- Discussion of importance of maintaining time diversity in deployment and focusing on process
Trump-Harris Debate Analysis
- Harris performed well with prepared responses but relied heavily on canned answers
- Trump faced challenges with perceived bias from moderators and real-time fact-checking
- Discussion of electoral dynamics including:
- Shift in Democratic Party from "beer track" to "wine track" appeal
- Media coverage disparities
- Impact on key voter demographics like Teamsters
The episode concluded with concerns about political rhetoric and its potential dangerous consequences following another assassination attempt against Trump.