Investors in risky asset classes "massively benefitted" from years of ultra-easy monetary policy, Chamath Palihapitiya, founder and CEO of Social Capital, said at the Axios BFD event Wednesday.
Why it matters: Chamath made his name as a boastful memelord, leading a crowd of retail-investor apes into SPACs and crypto. Now he's wearing a dark suit, talking about risk-adjusted returns and intellectual rigor, and remorsefully saying that he was blinded by zero interest rates.
- Everything he did at the height of the boom, he now says, was just an "experiment" in terms of generating returns for his investors.
Context: With inflation perched near 40-year highs, the Federal Reserve is embarked on its most aggressive tightening campaign in decades -- reversing years of zero interest rates that fueled massive speculative bubbles, Palihapitiya acknowledged.
What they're saying: “There's a narrative fallacy in Silicon Valley. We have been telling this lie which is that this is an artisanal craft business. It's not true," the investor told Axios' Dan Primack.
- "We've actually had a massive tailwind because we had a zero interest rate environment that allowed us to raise unbelievable amounts of money from investors who frankly had few other alternatives because interest rates were zero.”
--Axios' Felix Salmon contributed to this article.