[Danny Moses, founder] of Moses Ventures made famous by the book-turned-movie “The Big Short” cautioned the market has not yet accounted for the negative economic impact of the mass cuts to government jobs carried out by the Elon Musk-championed Department of Government Efficiency.
Moses argued investors are already beginning to see disruptions in consumer confidence—which last month saw its steepest drop in four years—and will continue to hear similar trends in upcoming earnings calls. These slowdowns have yet to be priced into the market, he said.
“It’s not as simple as just, ‘We think there’s fraud, let’s cut waste, let’s cut expenses,’” Moses told Fortune. “And it’s not just about the federal workers, and it’s not just about the expenses out of those programs. It’s about the contracts with the private sector.”
The tell-tale signs of the weakening economy will be seen in small businesses and “private contractors that are doing legitimate work services that are now being forced to make decisions on their business,” Moses said.
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