Populist Movement 2024 and Beyond
Level 2 - Value Investor
Welcome Avatar! For fun we’re going to make our case for a populist movement in the USA going forward. There is no way to prove that this will occur. Instead we’re just going to outline how we see the USA/World evolving over the next several years. Considering the success of Javier Milei and the attention that Nayib Bukele is getting, we’re of the belief that people are looking for a visceral change in direction. Maybe not today or tomorrow, but a trend to watch over the next 5 years or so.
This is also happening in the USA. Now that home ownership is becoming less and less likely for the middle class and the rich and poor divide is exploding, we’re betting that populism will be a growing theme.
Part 1: General Direction
Previously we noted that the USA is a culture of Transactional Relationships with a growing rich and poor divide (Source). We stand by that claim and it helps explain a ton of the trends: 1) sugar relationships, 2) obsession with overnight success - going viral or 10x meme coins, 3) spread of stock returns - magnificent 7 versus S&P 500 and 4) gambling/sports betting.
As a quick recap our expectation is a lot of importation of 3rd world culture into the USA this includes and is not limited to:
Paid sex work from OnlyFans to Sugar relationships to outright transactions
More and more drug use as younger cohorts can’t afford the alcohol binges
Immersive digital experience - more time spent online vs. in the real world
Decline in birth rates as both men and women have outlandish expectations
Scams being seen as real work since “everyone is doing it” - low trust
Increase in gambling addiction problems
Increase in loneliness and mental health issues particularly age 40s
If it were possible to buy a stock or coin that was long all of these trends? We’d put our net worth into it. While certain segments will grow faster than others depending on the year, it’s the direction of the USA.
We’re a culture of extremes and the more extreme you are = more attention and money. This means every year people have to do crazier and crazier things to get into the limelight.
Result of Said Trends
Once again that is simply our opinion. If you view the direction as the same it means that wealth disparity will only increase. People will constantly look for the quick fix or “Magic Pill” instead of trying to build anything over years (let alone a decade)
You’ll see people look for fast money, look for ways to get “quick scams” and idolize rapid rises to fame (look how fast Travis Kelce was glorified).
In the exponential age, people will not be able to survive the long periods of no results (before the spike) and will constantly give up instead. They will focus on anything that yields short term results. You know what else results in good short terms feels?
You guessed it drugs. It all relates.
Part 2: Eventually Hits a Tipping Point - Populism
Will this happen in the next 12 months? Unlikely.
People are still surviving on credit and simply don’t have what it takes to try and enact change. If you look at all the viral complaints about food prices, they are made while driving an SUV or wearing upper middle class clothing. People are taking a lifestyle hit but we’re not at a point where clamps will be put on.
Housing First: If we were to guess, the general population is going to go after housing. During COVID people were able to live rent free and generally view Landlords as “evil”.
There is already a movement for limiting short term rentals (AirBnBs) and a movement for limiting homeownership (numbers for hedge funds).
The nomenclature of hedge funds is irrelevant. Anyone with a lot of money would reclassify to try and get around the rules. However. The message is pretty clear, the population is losing patience.
They are looking for a solution to housing/affordability. Our guess is that eventually there will be a push based on two items: 1) the taxes related to more expensive homes - see California Mansion Tax and 2) a change in taxes/deductions for rental properties and vacation homes vs. primary residence. While some differences exist we’d expect this to change if the market starts to look like Canada.
Food Likely Second: Depending on how the wealth divide shakes out over the coming years, we may see a push to universal basic sustenance (would be called something nicer). Once the divide is large enough, the rich will not want to live in a world where they have to go outside and worry about crime constantly.
Crime as the Canary in the Coal Mine: California (Southern in particular) is already grappling with this. Gangs are organized to target rich people for jewelry and even case their homes. It is actually spreading up the coast into the silicon valley and bay area. Also. Due to the lax robbery rules... Petty theft for food, hygiene and other basic necessities is rampant.
This is all being reflected in housing prices particularly in San Francisco where $1,100/sq foot was common. Now it isn’t surprising to see $800/sq foot or ~$850/sq foot as evidenced in this transaction.
If we’re already allowing people to steal, the rich will likely be on board with basic food stipends if the wealth gap is wide enough. A major reason to live in the USA is to be “rich in peace”. (the rich would not be on board with cash handouts since this would be blown instantly)
Extreme Political Takes Third: If you think we’re here, we haven’t seen anything yet. Just look at Argentina as a good example of what is to come. You’ll see deep left and deep right policies gain the most traction. We saw a glimpse of this during the Bernie Sanders hype and we will undoubtedly see some extreme Right-Winged takes shortly (to balance out the political circus).
If you’re interested in a career in politics (some of you are!) just vocalize extreme takes. The biggest opportunity here is unsurprisingly for attractive women. Just copy paste the top male talking points and re-word them. You’re good to go after that. You could even do this with a AI/fake female since the quality is at a point where no one can tell the difference.
Part 3: Populism and “Return” are Not the Same
One thing people are missing is the change in priorities for people in their 20s, 30s and 40s. This is a major problem with all the "Trad” accounts on X and Instagram. We are not going back to the 1960s.
Twenties: People in this age band are not like the 70s or 80s kids. They do not care as much about outdoor activities (unless it involved music/drug/alcohol use). It likely explains why Mark Cuban sold the Dallas Mavericks. This cohort is more interested in being able to work from home or in front of a screen vs anything else. The internet is the real world to them. This is exacerbated by the fact that many will be forced to live at home with their parents. Just means more connection to the online world.
Thirties: This group remains pretty obsessed with escapism: partying and travel in particular. If you don’t have the money to buy a house you’re going to move your spending to experiences. Bit too old to hit the clubs at this point so you’re in the house party and travel party bucket.
Forties: Pretty much max loneliness. A small chunk of people will have the standard family life but that’s certainly the minority. Lots of cat and dog moms/dads in this cohort. They will also be the most vocal about how policies should be written.
This is a bit scary since the goal is not going to be “building a brighter future for your kids” since they don’t have kids. The goal will be spending now now now now.
Since the direction is for less children, the major battle field is going to be balancing immigration with lower organic population growth.
Generally speaking wealthy families have less kids or tons of kids while low income usually have a ton of kids. Directionally this would lead to lower test scores and standard of living for the median person (we’re seeing both of these)
Inheritance Increases: Consistent increase in inheritance maximums. Since the majority will feel like they were cheated out of their future (human nature is never to take responsibility), this will be the one *out* for them to “live it up like they deserve”. If you’re worried about inheriting a small fortune (anything under $10M), sleep well at night knowing it unlikely changes.
Transactional Relationships: More and more transactional marriages/relationships. You’re already seeing attractive guys date less attractive women who have a bunch of money. Even if they don’t plan on having kids (or can’t - see 40 and single dynamic above), it will continue. Likely leads to looser cohabitation laws since no one wants to be stuck in a common law marriage.
Looser Drug Rules: Since people will spend two straight decades partying their brains out (20s and 30s) they will need a way to keep that stimulation going. That would likely lead to a green-light of harder and harder drugs. California and the west coast will be the breeding ground for this movement (already happened with medicinal marijuana)
Changing The Direction?
We’re aware of the cheesy saying “be the change you want to see”. Yada, yada, yada. There is your personal life (micro) and the bigger picture. You can make your own life choices but you will not change the direction of NPCs.
NPCs are already set in their ways and simply can’t be fixed. They are already glued to TikTok and give their money to latest celebrity/hot product they see in a 5 second video.
Video game bars, mental health clinics, drug rehab and anything that solves for extended periods of loneliness will be money printers. Instead of asking what you would do, it is better to ask what the masses will do and the above is a much more likely outcome.
On that note if we missed anything else that people will vote in favor of please leave it in the comments and we can try to think of ways to spin up a biz around that theme.
Just remember the general direction of rich vs. poor and less families/kids is already in motion (pets still in parabolic growth mode). So we have to bet on what they will vote for.
Disclaimer: None of this is to be deemed legal or financial advice of any kind. These are *opinions* written by an anonymous group of Ex-Wall Street Tech Bankers and software engineers who moved into affiliate marketing and e-commerce. We’re an advisor for Synapse Protocol 2022-2024E.
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