Sacks argues under-reaction caused the pandemic and overreaction will cause a depression.
“I tweeted that the pandemic, that under reaction caused the pandemic and overreaction will cause the depression. And I think that's kind of where we are right now.”
Sacks says real wage growth is now 1% positive compared to negative during most of Biden presidency.
“You had 3.7% wage growth this year versus 2.7% average inflation, so you have a net 1% wage growth. During most of the Biden presidency, it was negative.”
Sacks says two million more American-born workers have jobs in 2025 while foreign-born workers lost a million.
“Around 2,000,000 more American born workers have jobs in 2025 so far. And I think meanwhile, about a million foreign born workers roughly have lost jobs.”
Sacks states AI represents 40% of US GDP growth and 80% of stock gains this year.
“40% of US GDP growth this year is AI and AI companies have accounted for 80% of the gain in US stocks this year.”
Sacks frames AI as the difference between 4% great growth and 2% modest growth for the economy.
“So AI is the difference between having great GDP growth, say around 4%, and modest GDP growth around 2%.”
Sacks cites breaking data showing US productivity at 4.9% and Q4 GDP forecast climbing to 5.4%.
“US productivity just surged 4.9%, the strongest reading in nearly six years. And this is the news item, is that the Atlanta Fed, their forecast for q four GDP just climbed to 5.4%.”
Sacks cites Q4 GDP growth rate of 5.4% despite government shutdown as beyond expectations.
“But, you know, in Q4 GDP growth rate 5.4% despite a government shutdown that just, you know, that number just kind of blew everyone away.”
Sacks says hyperscaler capex will exceed $700 billion this year, up from $350 billion last year, over 2% of GDP.
“This year, I think we were supposed to have $660,000,000,000 of hyperscaler CapEx up from $3.50 last year. I think there's now the new estimate is is gonna be over 700.”