Fri, 28 Apr 2023 19:07:00 +0000
The U.S. economy will enter a recession in the near term following this April 2023 discussion, i.e., during the 2023 economic cycle.
“I think that we are headed for it seems like a recession.” View on YouTube
The US experienced significant recession fears and banking stress (the March 2023 regional bank failures) but ultimately avoided an officially declared recession in 2023, with GDP growth remaining positive throughout the year.
By December 31, 2023, large language model–based AI systems (e.g., ChatGPT-4 and similar tools) will be capable of performing roughly 30% of the tasks currently done by typical white‑collar knowledge workers, at a quality level sufficient to be practically usable in real businesses.
“I think by the end of this year, 30% of knowledge work could be done by this.” View on YouTube
By the end of 2023, generative AI tools like GPT-4 had not been shown to reliably perform 30% of knowledge-work tasks at a practically usable quality level across typical white-collar jobs; adoption and measurable productivity impact, while real, remained more limited and uneven than this prediction implied.
Any white‑collar/knowledge worker who does not start using and getting up to speed on modern AI tools (like ChatGPT-4) during 2023 will lose their job and be unable to compete in the labor market within roughly the following two years (by around the end of 2025).
“If you hear my voice right now and you're a white collar worker or knowledge worker and you're not using this this year and getting up to speed on it, I think you'll be out of a job within the next two GS.” View on YouTube
Knowledge workers who did not adopt AI tools during 2023 did not uniformly lose their jobs within the following two years; while AI adoption has become increasingly important, mass job losses specifically tied to individual non-adoption of AI tools by 2025 did not occur as starkly as predicted.
Within roughly the next 1–2.5 years from April 2023 ("five quarter ten" timeframe), the effective cost of performing white‑collar knowledge work, when leveraging AI tools, will fall by about 90%, to roughly 10% of its previous level.
“I don't know, I think everything's going to cost about ten. All this knowledge work is going to be 10% as expensive to do. I don't think it's 10% less Chamath or you know, I think it's like 90% $0.10 on the dollar to knowledge work.” View on YouTube
AI tools have reduced costs for certain categories of knowledge work substantially, but a broad, economy-wide 90% cost reduction across white-collar knowledge work within roughly a year to two and a half years of April 2023 did not clearly materialize at that scale or pace.
Owners who buy heavily vacant San Francisco office towers at distressed prices in 2023 will need to hold them for approximately 5–10 years before office demand and rents recover enough for the investment to make economic sense.
“So you're going to be sitting on that property for five years, ten years before the market comes back the way that you need it to.” View on YouTube
San Francisco office vacancy remained near historic highs (around 30%+) through 2024-2025 without a clear recovery, consistent with continued distress for owners of vacant towers purchased in 2023, though the full 5-10 year holding period has not yet elapsed to fully confirm.
San Francisco’s downtown office vacancy rate, which is already above 30% in April 2023, will likely rise further and may reach around 40% as existing leases roll off and tenants shed additional space over the subsequent few years.
“So they're at 30% plus. And like I said, it could get worse before it gets better because as Lisa's role people are going to shed more space that they might not already be subleasing. So the real number might be like 40%.” View on YouTube
San Francisco's downtown office vacancy rate did continue climbing beyond 30% toward the mid-30s percent range in the years following April 2023, consistent with this prediction.
San Francisco’s downtown office market will not return to a normal/healthy vacancy range (roughly 5–15%) for at least five years and possibly up to about a decade after 2023; i.e., sustained elevated vacancy will persist into at least the late 2020s and potentially early 2030s.
“I mean, five years plus. I mean, just to give you some numbers... So they're at 30% plus. And like I said, it could get worse before it gets better... So like a decade, I think it's like, yeah, it doesn't seem like a decade. Feels like it's a decade.” View on YouTube
This prediction has a window extending to roughly 2028-2033 for San Francisco's office market to normalize, which has not yet fully elapsed; vacancy remains elevated as of the mid-2020s, consistent with the trajectory so far but not yet conclusively resolved.
A Merck executive predicts that sales of fetal bovine serum used for cellular meat production will rise to approximately $1 billion in annual revenue and then rapidly fall to near zero because cellular-meat companies will not be able to make money at the required cost structure, causing that use case to collapse.
“the Merck exec was like, we're going to sell $1 billion of fetal bovine serum, and then we're going to sell zero because no one's going to be able to make money doing this” View on YouTube
Cultivated/cellular meat companies have continued to struggle commercially and several have faced setbacks or shutdowns by the mid-2020s, broadly consistent with the pessimistic framing here, though a specific fetal bovine serum sales trajectory matching '$1 billion then zero' is not independently verifiable.
Friedberg predicts that companies working on recombinant protein production and cellular meat will require several more years (on the order of a few years beyond 2023) and several additional billions of dollars of investment, but that they will ultimately succeed in making these technologies work at commercially viable, cost-competitive scales.
“it’s very likely that these companies may need several more years and several billion dollars. We are going to get there” View on YouTube
Cellular agriculture and recombinant protein companies have continued raising capital and pursuing years of further R&D as predicted, but commercial viability and cost-competitive scale for these technologies remained largely unrealized as of the mid-2020s, making the ultimate 'success' portion of this prediction still unresolved.
Over the long term, recombinant/synthetic-biology-based production methods will move far enough down the cost curve that they become ubiquitous for producing all major classes of proteins and cell types, displacing traditional animal-sourced production for those products.
“eventually we'll get to that cost curve where they're ubiquitous for all proteins or for all types of cells” View on YouTube
This is a long-term projection about recombinant protein production becoming ubiquitous across all protein and cell types, a horizon far beyond what can be assessed within a few years of 2023.
David Sacks maintains his prediction (as of April 28, 2023) that the U.S. economy will enter a recession in the near future, i.e., within the upcoming business cycle following this statement.
“I'm sticking by it. I think we're still going to have a recession” View on YouTube
The US did not enter a recession in the period following this April 2023 statement; the economy continued growing throughout 2023 and 2024, defying widespread recession predictions.