The analyst who once predicted the ‘end of capitalism’ sees Zohran Mamdani’s election as a ‘day of reckoning coming in’—and corporates only have themselves to blame
Albert Edwards, the long-standing strategist at Société Générale known for offering the “alternative view” within the institution, believes the recent political success of figures like Zohran Mamdani signal the corporate sector’s self-inflicted backlash against “greedflation.” Edwards, whose career in finance dates back to 1982 and who hasn’t been aligned with the “house view” of his investment bank for many years now, has gained a sort of cult following for his skeptical approach to market narratives, once famously writing a note about how appalled he was by “greedflation,” or record profit margins against the backdrop of post-pandemic inflation. He described it as the “end of capitalism” in 2023, and in conversation with Fortune, absolutely stood by his point.
At that time, Edwards said, inflation was generally being blamed on raw material prices because of the Ukraine war, as well as the labor market, with very few people saying there was profit-driven inflation, but he took a different view: “This is unprecedented,” he noted, pointing out, “when unit costs rise, always, unit margins fall, always, in history.” He said that shouldn’t have happened, and the reason it did was because of so much stimulus from the government that “companies could get away with doing it, using [inflation as] cover.”
The consequence of this money printing and fiscal expenditure was a “bonanza for the corporate sector,” resulting in corporate profit margins soaring “off to infinity” after the pandemic. Edwards noted specific sectors benefited enormously, recalling a St. Louis Fed study that showed corporate profits as a share of national income surging since the inflation spike, a total outlier compared with the rest of the world.
This period of corporate excess laid the groundwork for severe political instability and public outrage, Edwards argued. Just look at the election in New York, he said, which was all about the cost of living. Zohran Mamdani’s election is “an indication that this still is a big issue.” Edwards agreed “affordability” is a major topic of the moment, along with the U.S. housing market: “It stands out as, like, ‘What’s going on?’”
This latest twist in the populist turn isn’t necessarily something to celebrate, Edwards said. As an economist, he said he considers Mamdani’s policies, deriving from his democratic socialist background, such as rent control and price controls, to be “lunacy,” having experienced them himself in the 1970s. Still, dysfunction in capitalism means that society will “come back full circle to this.” The increasing intergenerational strife, driven by young people being shut out of the housing market and out of wealth concentration, has created a primal sense of betrayal, especially among Americans who no longer feel they are better off than their parents.
Edwards was speaking as the first-time homebuyer hit an average age of 40 years old, a stark symbol of how the largely youthful voter base that elected Mamdani is shut out of the market. Sean Dobson, CEO of the Amherst Group, one of America’s largest institutional landlords, recently estimated the same post-COVID economic landscape that so outraged Edwards meant “we’ve probably made housing unaffordable for a whole generation of Americans.”
‘You reap what you sow’
Coming back to his critique of capitalism, Edwards argued Mamdani’s election is “part of the consequence … The corporates, by being excessively greedy, hence ‘greedflation,’ have laid the seeds for their own destruction—and backlash.” Edwards added that “more and more people are identifying corporate excess.”
Speaking about what he called “intergenerational strife,” Edwards said he thinks this is “the first generation where people are not seeing themselves as better off than their parents were.” Everywhere you look in modern capitalism, “young people can’t get on the housing ladder, they see wealth extremely concentrated … It takes the incentivization out of the economy if young people don’t feel they’re participating.”
Edwards’s argument here has some strange bedfellows, as none other than Peter Thiel has been warning about this incentivization problem for years. Mamdani’s election seemed to send a shiver through Silicon Valley’s right-wing contingent, as Chamath Palihapitiya shared Peter Thiel’s 2020 email to Mark Zuckerberg and Marc Andreessen, warning of a “broken generational compact” and reasoning, “if one has no stake in the capitalist system, then one may well turn against it.” In a follow-up interview days later, Thiel told The Free Press, “if you proletarianize the young people, you shouldn’t be surprised if they eventually become communist.”
On the left wing of legal thought, Columbia Law School professor Tim Wu recently told Fortune that he wrote his new book, The Age of Extraction, about a similar feeling. “My understanding of America is that it’s the place where things are supposed to get better,” Wu said, but instead we’re living through a time with “an economy-wide problem” where “everything kind of just creeps. It’s that weird feeling of something you like becoming worse.” He added that American politics right now are “very angry” and marked by “economic resentment” but also a general feeling that “we let things go a little too far” and we “just kind of lost touch with the tradition of broad-based wealth that was the American way.”
On the subject of greedflation, Edwards was philosophical but insisted that what happened in 2023 was a mistake. “Okay, I can understand this is capitalism, this is how it works,” he said about pursuit of the profit motive, “but if the government doesn’t step in” then a backlash is bound to happen. Edwards declined to say whether this was a particularly Democratic or Republican issue, but, he noted, “there’s a reluctance” in American culture to dictate to the corporate sector. At any rate, the consequence of it is “there’s a day of reckoning coming in,” he said.
Edwards, who is also convinced artificial intelligence is in a bubble, said he views his role in this often overly optimistic market as similar to “Caesar’s slave,” referring to the story from antiquity about the Roman emperor ordering someone to follow him around and always whisper in one ear: “You are mortal.” (This is also commonly referred to by the Latin phrase “memento mori.”) Edwards warns while the macro-level excesses might not be visible in aggregate, drilling down reveals “things are pretty crappy under the surface.” The political reaction embodied by Mamdani’s focus on affordability is a clear sign that the economic consequences of corporate greed are now driving mainstream political change.
Edwards concluded there’s a fitting phrase for the dysfunctions of capitalism in the 2020s: “You reap what you sow.”
In a major effort to close the global health equity gap, the Gates Foundation and OpenAI are partnering on “Horizon1000,” a collaborative initiative designed to integrate artificial intelligence into healthcare systems across Sub-Saharan Africa. Backed by a joint $50 million commitment in funding, technology, and technical support, the partnership aims to equip 1,000 primary healthcare clinics with AI tools by 2028, Bill Gates announced in a statement on his Gates Notes, where he detailed how he sees AI playing out as a “gamechanger” for expanding access to quality care.
The initiative will begin operations in Rwanda, working directly with African leaders to pioneer the deployment of AI in health settings. With a core principle of the Foundation being to ensure that people in developing regions do not have to wait decades for new technologies to reach them, the goal in this partnership is to reach 1,000 primary health care clinics and their surrounding communities by 2028.
“A few years ago, I wrote that the rise of artificial intelligence would mark a technological revolution as far-reaching for humanity as microprocessors, PCs, mobile phones, and the Internet,” Gates wrote. “Everything I’ve seen since then confirms my view that we are on the cusp of a breathtaking global transformation.”
Addressing a Critical Workforce Shortage
The impetus for Horizon1000, Gates said, is a desperate and persistent shortage of healthcare workers in poorer regions, a bottleneck that threatens to stall 25 years of progress in global health. While child mortality has been halved and diseases like polio and HIV are under better control, the lack of personnel remains a critical vulnerability.
Sub-Saharan Africa currently faces a shortfall of nearly 6 million healthcare workers, ” a gap so large that even the most aggressive hiring and training efforts can’t close it in the foreseeable future.” This deficit creates an untenable situation where overwhelmed staff must triage high volumes of patients without sufficient administrative support or modern clinical guidance. The consequences are severe: the World Health Organization (WHO) estimates that low-quality care is a contributing factor in 6 million to 8 million deaths annually in low- and middle-income countries.
Rwanda, the first beneficiary of the Horizon1000 initiative, illustrates the scale of the challenge. The nation currently has only one healthcare worker per 1,000 people, significantly below the WHO recommendation of four per 1,000. Gates noted that at the current pace of hiring and training, it would take 180 years to close that gap. “As part of the Horizon1000 initiative, we aim to accelerate the adoption of AI tools across primary care clinics, within communities, and in people’s homes,” Gates wrote. “These AI tools will support health workers, not replace them.”
AI as the ‘Third Major Discovery‘
Gates noted comments from Rwanda’s Minister of Health Dr. Sabin Nsanzimana, who recently announced the launch of an AI-powered Health Intelligence Center in Kigali. Nsanzimana described AI as the third major discovery to transform medicine, following vaccines and antibiotics, Gates noted, saying that he agrees with this view. “If you live in a wealthier country and have seen a doctor recently, you may have already seen how AI is making life easier for health care workers,” Gates wrote. “Instead of taking notes constantly, they can now spend more time talking directly to you about your health, while AI transcribes and summarizes the visit.”
In countries with severe infrastructure limitations, he wrote, these capabilities will foster systems that help solve “generational challenges” that were previously unaddressable.
As the initiative rolls out over the next few years, the Gates Foundation plans to collaborate closely with innovators and governments in Sub-Saharan Africa. Gates wrote that he himself plans to visit the region soon to see these AI solutions in action, maintaining a focus on how technology can meet the most urgent needs of billions in low- and middle-income countries.
When it comes to creating irresistible storylines, Netflix, the home of Stranger Things and The Crown, is second to none. And as the streaming video giant delivered its quarterly earnings report on Tuesday, executives were in top storytelling form, pitching what they promise will be a smash hit: the acquisition of Warner Brothers Discovery.
The company’s co-CEOs, Ted Sarandos and Greg Peters, said the deal, which values Warner Brothers Discovery at $83 billion, will accelerate its own core streaming business while helping it expand into TV and the theatrical film business.
“This is an exciting time in the business. Lots of innovation, lots of competition,” Sarandos enthused on Tuesday’s earnings conference call. Netflix has a history of successful transformation and of pivoting opportunistically, he reminded the audience: Once upon a time, its main business entailed mailing DVDs in red envelopes to customers’ homes.
Despite Sarandos’ confident delivery, however, the pitch didn’t land with investors. The company’s stock, which was already down 15% since Netflix announced the deal in early December, sank another 4.9% in after-hours trading on Tuesday.
Netflix’s financial results for the final quarter of 2025 were fine. The company beat EPS expectations by a penny, and said it now has 325 million paid subscribers and a worldwide total audience nearing 1 billion. Its 2026 revenue outlook, of between $50.7 billion and $51.7 billion, was right on target.
Still, investors are worried that the Warner Bros. deal will force Netflix to compete outside its lane, causing management to lose focus. The fact that Netflix will temporarily halt its share buybacks in order to accumulate cash to help finance the deal, as it disclosed towards the bottom of Tuesday’s shareholder letter, probably didn’t help matters.
And given that there’s a rival offer for Warner Bros from Paramount Skydance, it’s not unreasonable for investors to worry that Netflix may be forced into an expensive bidding war. (Even though Warner Brothers Discovery has accepted the Netflix offer over Paramount’s, no one believes the story is over—not even Netflix, which updated its $27.75 per share offer to all-cash, instead of stock and cash, hours earlier on Tuesday in order to provide WBD shareholders with “greater value certainty.”)
Investors are wary; will regulators balk?
Warner Brothers investors are not the only audience that Netflix needs to win over. The deal must be blessed by antitrust regulators—a prospect whose outcome is harder to predict than ever in the Trump administration.
Sarandos and Peters laid out the case Tuesday for why they believe the deal will get through the regulatory process, framing the deal as a boon for American jobs.
“This is going to allow us to significantly expand our production capacity in the U.S. and to keep investing in original content in the long term, which means more opportunities for creative talent and more jobs,” Sarandos said.
Referring to Warner Brothers’ television and film businesses, he added that “these folks have extensive experience and expertise. We want them to stay on and run those businesses. We’re expanding content creation not collapsing it.”
It’s a compelling story. But the co-CEOs may have neglected to study the most important script of all when it comes to getting government approval in the current administration; they forgot to recite the Trump lines.
The example has been set over the past 12 months by peers such as Nvidia’s Jensen Huang and Meta’s Mark Zuckerberg. The latter, with his company facing various federal regulatory threats, began publicly praising the Trump administration on an earnings call last January.
And Nvidia’s Huang has already seen real dividends from a similar strategy. The chip company CEO has praised Trump repeatedly on earnings calls, in media interviews, and in conference keynote speeches, calling him “America’s unique advantage” in AI. Since then, the U.S. ban on selling Nvidia’s H200 AI chips to China has been rescinded. The praise may have been coincidental to the outcome, but it certainly didn’t hurt.
In contrast, the president went unmentioned on Tuesday’s call. How significant Netflix’s omission of a Trump call-out turns out to be remains to be seen; maybe it won’t matter at all. But it’s worth noting that its competitor for Warner Bros., Paramount Skydance, is helmed by David Ellison, an outspoken Trump supporter.
It’s a storyline that Netflix should have seen coming, and itmay still send the company back to rewrite.
After nearly a year of promises tariffs would boost the U.S. economy while other countries footed the bill, a new study shows almost all of the tariff burden is falling on American consumers.
Americans are paying 96% of the costs of tariffs as prices for goods rise, according to research published Monday by the Kiel Institute for the World Economy, a German think tank.
In April 2025 when President Donald Trump announced his “Liberation Day” tariffs, he claimed: “For decades, our country has been looted, pillaged, raped, and plundered by nations near and far, both friend and foe alike.” But the report suggests tariffs have actually cost Americans more money.
Trump has long used tariffs as leverage in non-trade political disputes. Over the weekend, Trump renewed his trade war in Europe after Denmark, Norway, Sweden, France, Germany, the United Kingdom, the Netherlands, and Finland sent troops for training exercises in Greenland. The countries will be hit with a 10% tariff starting on Feb. 1 that is set to rise to 25% on June 1, if a deal for the U.S. to buy Greenland is not reached.
On Monday, Trump threatened a 200% tariff on French wine, after French President Emmanuel Macron refused to join Trump’s “Board of Peace” for Gaza, which has a $1 billion buy-in for permanent membership.
“The claim that foreign countries pay these tariffs is a myth,” wrote Julian Hinz, research director at the Kiel Institute and an author of the study. “The data show the opposite: Americans are footing the bill.”
The research shows export prices stayed the same, but the volume has collapsed. After imposing a 50% tariff on India in August, exports to the U.S. dropped 18% to 24%, compared to the European Union, Canada, and Australia. Exporters are redirecting sales to other markets, so they don’t need to cut sales or prices, according to the study.
“There is no such thing as foreigners transferring wealth to the U.S. in the form of tariffs,” Hinz toldTheWall Street Journal.
For the study, Hinz and his team analyzed more than 25 million shipment records between January 2024 through November 2025 that were worth nearly $4 trillion.They found exporters absorbed just 4% of the tariff burden and American importers are largely passing on the costs to consumers.
Tariffs have increased customs revenue by $200 billion, but nearly all of that comes from American consumers. The study’s authors likened this to a consumption tax as wealth transfers from consumers and businesses to the U.S. Treasury.
Trump has also repeatedly claimed tariffs would boost American manufacturing, butthe economy has shown declines in manufacturing jobs every month since April 2025, losing 60,000 manufacturing jobs between Liberation Day and November.
The Supreme Court was expected to rule as soon as today on whether Trump’s use of emergency powers to levy tariffs under the International Emergency Economic Powers Act was legal. The court initially announced they planned to rule last week and gave no explanation for the delay.
Although justices appeared skeptical of the administration’s authority during oral arguments in November, economists predict the Trump administration will find alternative ways to keep the tariffs.
Politics8 years ago