Why is the economy tanking and what can builders do about it?
and team shared an excellent explainer that everyone should watch.
I'll recap the first few slides:
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1/ Inflation (CPI) is at a 40-year high.
Historically, the Fed has raised the interest rate to reduce inflation. However, the Fed waited too long to increase the rate and now inflation is out of control.
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2/ The Fed is now forced to increase rates to combat inflation, even if it hurts the economy.
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3/ Stocks typically move in the opposite direction as interest rates.
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4/ Growth stocks get hurt the most because their future earnings are discounted by higher interest rates.
Even if many of the companies listed here are still growing and executing well.
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5/ This has trickle-down effects for the ability for startups to fundraise.
Venture markets follow the same trajectory as public markets.
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6/ This feels more like the dot com crash of 2000s vs. the 2008 recession due to growth/tech companies being impacted more.
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7/ Watch the full video for what builders can do in this environment and more:
thanks for this recap, was a great video for any founder to watch
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