Chamath Palihapitiya: US shouldn't bail out hedge funds, billionaires during coronavirus pandemic

[Celerity]

(I have to laugh at how gobsmacked the newsbot on CNBC is when presented with clear, concise rebuttals of his talking points)

Link to tweet

Chamath Palihapitiya: US shouldn’t bail out hedge funds, billionaires during coronavirus pandemic

(video in the tweet above and at the link below)


Chamath Palihapitiya, founder and CEO of investment firm Social Capital, said the U.S. shouldn’t be bailing out billionaires and hedge funds during the coronavirus pandemic. Palihapitiya added that he was concerned that the Federal Reserve’s plans to support to economy during the COVID-19 crisis are going to have consequences, and it would have been better to just give more money to Americans.

https://www.cnbc.com/2020/04/09/chamath-palihapitiya-us-needs-to-let-hedge-funds-billionaires-fail.html

Chamath Palihapitiya, founder and CEO of investment firm Social Capital, told CNBC on Thursday that the U.S. shouldn’t be bailing out billionaires and hedge funds during the coronavirus pandemic. “On Main Street today, people are getting wiped out. Right now, rich CEOs are not, boards that have horrible governance are not. People are,” Palihapitiya, an early Facebook executive, said on CNBC’s “Fast Money Halftime Report.” “What we’ve done is disproportionately prop up poor-performing CEOs and boards, and you have to wash these people out.”

“Just to be clear on who we are talking about. We’re talking about a hedge fund that serves a bunch of billionaire family offices, who cares? They don’t get the summer in the Hamptons?” he said. “These are the people that purport to be the most sophisticated investors in the world.” Palihapitiya also said he was concerned that the Federal Reserve’s plans to support to economy during the COVID-19 crisis are going to have consequences.

The Fed earlier in the day announced a slew of new moves aimed at getting another $2.3 trillion of financing into businesses and governments, including its Main Street business lending program and market interventions. The central bank said its loans will be geared toward businesses with up to 10,000 employees and less than $2.5 billion in revenues for 2019. Programs would total up to $2.3 trillion and include the Payroll Protection Program and other measures aimed at getting money to small businesses and bolstering municipal finances with a $500 billion lending program, it added.

But Palihapitiya said it would have been better to just give more money to Americans. “I’m not disagreeing with what the Fed has to do. What I’m saying is it’s creating a land mine, and it’s creating a bill that will have to come due,” he said. “It would be better for the Fed to have given half a million to every man, woman and child in the United States,” he added.

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Chamath Palihapitiya is a billionaire himself, btw.

https://en.wikipedia.org/wiki/Chamath_Palihapitiya

Politics

Immigration reform and policy advocacy

Palihapitiya was listed as one of the "Founders" of the lobbying group FWD.us. The group launched on April 11, 2013, and its goals include immigration reform, improving education, and enabling technological innovation, all in a United States context. An article in The New Republic stated that Palihapitiya received a weekly report about FWD.us and also quoted him as saying, in response to controversy around the FWD.us political lobbying strategy: "The folks that are actually people that run that day to day are sophisticated and understand the nuances of how to affect it... It's a really gnarly, gnarly thing having to deal with Washington. And to be honest with you, my perspective was, it's a really good investment because it's a good way to pay it forward, and I'm really glad there are other people other than me who are dealing with it who have the patience and resolve to figure it out."

snip

Criticism of Facebook and social media

In November 2017, Palihapitiya revealed that, for ethical reasons, he regrets having helped Facebook to become the largest social media platform. He said, "[t]he short-term, dopamine-driven feedback loops that we have created are destroying how society works: no civil discourse, no cooperation, misinformation, mistruth and it's not an American problem. This is not about Russian ads. This is a global problem. It is eroding the core foundations of how people behave by and between each other. I can't control them. I can control my decision, which is that I don't use that shit. I can control my kids' decisions, which is that they're not allowed to use that shit". Following criticism from Facebook for his remarks, Palihapitiya subsequently clarified, "I genuinely believe that Facebook is a force for good in the world, so I'd like to expand on my comments...My comments were meant to start an important conversation, not to criticize one company — particularly one I love. In 2017, many of us have grappled with the unintended consequences of the products we've built. Social media platforms in particular have been used and abused in ways that we, their architects, never imagined. Much blame has been thrown and guilt felt, but the important thing is what we as an industry do now to ensure that our impact on society continues to be a positive one.

[uponit7771]

1. K&R, I agree with him that there's 100% miss allocation of financial resources here. Give 50,000

... yr to each working person that doesn't have assets over 50,000 for instance and that's cheaper than 2.5 trillion in loans to big business.