In the six months leading up to November 2022, as the two‑year clocks on the 2020–2021 SPACs near expiration, there will be significant market dislocation and "really crazy behavior" in SPAC dealmaking (e.g., heavy discounting, retrades, and pressure on sponsors) driven by the approaching deadlines to complete mergers.
“we're still in the first inning, right... these SPACs have two years to put the money to work... and so you're going to see some really crazy behavior I predict in November of 2022, right. Like the last six months leading into the expiration of all these SPACs”
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Explanation
The SPAC market did experience severe dislocation as 2020-2021 SPACs approached their two-year deadlines through 2022, with widespread redemptions, deal collapses, and distressed retrades.
From early 2021 until roughly the 2022 midterm elections (about 1.5 years), the Democratic Party will continue to be able to pass large spending bills with relatively little constraint due to holding unified control of the federal government.
“before the midterms, we've got another year and a half of this 100%”
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Explanation
Democrats held unified control of the White House, House, and Senate through the 2022 midterms and passed major spending legislation (the American Rescue Plan, Infrastructure Investment and Jobs Act, and Inflation Reduction Act) during that window.
In the United States, the post‑COVID economy will rebound strongly in 2021, with a boom resembling a "Roaring 20s" environment; specifically, unemployment will fall to roughly 3% by the end of 2021 and the acute phase of the COVID-19 crisis in the U.S. will effectively be over by May 2021.
“Everyone's been lulled into a false sense of security because interest rates are so low... the economy is getting better. Right? It looks like we're about to have the Roaring 20s. The economy looks like it's rebounding. It's about to boom. Goldman Sachs says we're going to be down to like 3% unemployment by the end of the year. It's coming back really fast. Covid is going to be over in May.”
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Explanation
Unemployment ended 2021 at 3.9%, not roughly 3%, and the Covid-19 crisis was not over by May 2021: the Delta variant drove a severe summer/fall 2021 wave well after that date.
Because the U.S. is using extreme fiscal measures (multi‑trillion‑dollar stimulus) in 2021 despite a rebounding economy, if another major economic emergency occurs in the near future, the federal government will have significantly reduced fiscal capacity to respond effectively.
“we're breaking the glass in case of emergency when there is no emergency. And what happens if there is another emergency?”
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Explanation
US federal debt and deficits did grow substantially in the years following 2021, consistent with reduced fiscal headroom, but no specific subsequent 'emergency' has directly tested whether the government's fiscal capacity to respond was in fact impaired.
If California enacts the proposed state-level wealth tax (AC 8 as described: 1% over $50M and 1.5% over $1B), it will not raise the projected ~$22 billion annually; instead, overall California tax revenue will decrease relative to the no-wealth-tax baseline because enough affected high-wealth individuals will leave the state, taking businesses, investment, and associated tax base with them.
“They estimate the wealth tax would generate over 22 billion. We've already seen Elon and it won't. That's a static analysis. That's such a stupid analysis because it's completely... You're not going to raise 22 billion from this. You're going to raise it's actually going to lead to a decrease in tax revenue, because so many of these people are going to leave the state and they're going to take investment with them, their businesses with them, their job creation with them.”
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Explanation
California's AC 8 wealth tax proposal never passed into law, so the conditional premise ('if California enacts the proposed wealth tax') was never fulfilled.
The California wealth tax proposal being discussed (AC 8, as of early 2021) will fail to obtain sufficient votes in the California legislature and will not be enacted into law in either 2021 or 2022.
“So just the mere fact they're proposing this bill, I don't think they're going to get the votes in this legislature. There's six Democrats have already come out against it. So I don't think it's going to pass this year or next year.”
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Explanation
California's AC 8 wealth tax proposal died without passing the legislature in both 2021 and 2022, exactly as predicted.