It had been a dry winter for Shervin Pishevar. The last we heard from his Twitter was mid-December when he announced his resignation from Sherpa Capital. It had seemed Pishevar had all but muted the mic on his thought-leadership.
Meanwhile, companies in which he’s invested like Uber, Dollar Shave Club, Warby Parker, and Slack, beat on toward New Year’s earnings. It’s possible Pishevar celebrated 2018 at home, ordering Chinese food from another one of his darlings, Postmates.
But make a loud enough crash, and you can awaken a bear from hibernation.
On Monday, following the U.S. stock market’s most stomach-dropping drop in recent memory, Pishevar tweeted a fifty-point explanation for why he thinks the market will drop an aggregate 6000 points in upcoming months.
Here’s why he thinks things could get worse before better:
1. February is not looking too hot.
Obviously, the market dipped. But not so obviously, Shervin Pishevar thinks the turmoil is reason to assume there will be more slippage: With all 2018 gains already forgone, he dare says 2017’s gains will go soon too. The main culprits for continued losses include “rising interest rates, increasing credit account deficits and tax giveaways.”
2. Bonds are not what they used to be.
Government bonds alone are not limitless in their power to recorrect the market, Pishevar argues. Although quantitative easing, or the process through which central banks buy bonds, is a tool that can reset the market, Pishevar argues such a “tool” has been used too many times to continue its effectiveness.
3. Inflation has been “exported.”
Much of Pishevar’s rant critiques any notion that an American economy, isolated from the global economy, is trending upward. He does not see inflation as an antidote contained to our borders, writing, “we’ve managed to export inflation for decades now.”
And he doesn’t have faith that uncertain global trade deals, under the current administration, will help.
4. A few big funds always crumble in times like these.
Pishevar is particularly concerned with Managed Future Funds and Volatility Indices. He sees both at risk for failure, and believes there’s precedent to expect a big one will bite the bullet.
5. Silicon Valley is not the modern Rome it once was.
Pishevar argues there’s been a loss of exclusivity in Silicon Valley—and while that’s not necessarily a bad thing, it’s not a good sign for short-term domestic economic growth. He basically says the stronghold, on talent and ideas, is no longer something to rely upon.
An immigrant himself, Pishevar writes passionately about the effects of expanding U.S. ideologies across the globe. He writes in 2008, “We no longer have the monopoly on the classic American entrepreneurial spirit backed by angels and venture capital. The American Way has become the Global Way.”
On Monday, Pishevar echoed his own sentiments, tweeting, “While we build walls physical and cultural to keep out immigrant talent that talent doesn’t need to come here anymore.”
He goes on to warn about the “frictionless” innovation seeming to flourish in other countries, citing an example of from China in which a team built a train station in nine hours.
This is all to say, the American economy isn’t alone.
6. Unicorns are becoming increasingly hungry.
Perhaps Pishevar’s most ominous forecast regards the influence, and possible downfall, of the United States’ big five unicorns: Alphabet, Amazon, Apple, Google, and Microsoft. Referring to them as monopolies, Pishevar argues companies of this size have the power and influence of nation-states. He warns of their power to buy out small startup competitors—and then ultimately fail the system at large.
Pishevar seems to think there’s a collective blind eye to the power of these “giants.” Notably, he invokes the excitement of small cities across the U.S. vying for the next Amazon office.
The late-night Twitter rant (which was interrupted shortly for dinner, and which some have deemed generally off-handed and unclear), does come with its fair share of hopeful assessments. Here are a few financial trends that Pishevar believes will be happening simultaneously to his anticipated 6000-point drop.
7. There are moonshots like SpaceX and Virgin Hyperloop will inspire good work.
For Pishevar, out of the “decrypt and decaying” infrastructure in the U.S. will rise a few “moonshots.” Mind you he is a co-founder of Virgin Hyperloop, so one should take this flattery with a grain of salt.
8. Entrepreneurs are “stateless” and can raise capital in any which way they want.
Want to start a company? Choose your currency.
Describing currency as “the ultimate app,” Pishevar sees a possible expansion in entrepreneurship due to digital currencies and new methods of fundraising. The more small companies that can find unique capital, the more they can grow and spur the economy onward.
8. An economic disaster can lead to a new type of economy.
Generally speaking, Pishevar’s fifty tweets acknowledge unstable conditions: He warns of “inflation spreading” and “stock markets crashing,” and describes underemployment as a “systemic economic stasis.”
However, Pishevar maintains a globalist perspective, and he offers some bits of hope. He seems to be saying that the potential for failure is an equal opportunity for a new, more egalitarian economy.
This is all to say, it seems Pishevar took to Twitter to express notions he’s been known to express before. He’s fighting for a more open, transparent society, without bottlenecks on innovation, and without volatility.
In their form, Pishevar’s concerns appear to be broader than the 6000-point decline he’s projecting. He touches on challenges within politics, and nationalism, even cultural trends. He’s not just an investor or a guy who watches numbers all day. Hell, he’s even a member of the 12-person committee that decides which young Americans get Fullbrights every year.
Somewhere within the 50 tweets, there might be a bullseye. Pishevar does, after all, have a knack for predicting the future. In 2008, for example, when he correctly anticipated Facebook’s eventual identity crisis. In the same article he writes, “While our financial systems lie teetering on near destruction, we realize we must build from the ground up a new system” — a notion he is back to pushing, through a new medium, ten years later.