What I Read This Week…

SpaceX successfully caught the Super Heavy booster using mechanical arms on its launch tower, U.S. CPI fell to 2.4% in September, and recent data suggests that India's economy may be slowing down

Chamath Palihapitiya

Oct 13, 2024

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SpaceX has achieved a major milestone in its Starship program with its fifth test flight earlier today, moving closer to a fully reusable launch system. What were the achievements of this test flight? The primary accomplishment was the successful return and capture of the Super Heavy booster – an enormous rocket standing 71 meters tall and weighing over 600,000 pounds – using mechanical arms on the launch tower, just seven minutes after liftoff. This rapid turnaround of the booster is crucial for SpaceX's goal of enabling frequent, cost-effective launches. The Starship upper stage also demonstrated its capability to separate from the booster and continue its mission independently. Additionally, Starship's thermal protection system was upgraded, including more robust heat shield tiles, a backup protective layer, improved tile mounting, and enhanced protection for vulnerable areas. These advancements bring SpaceX closer to its goals of supporting NASA's Artemis program for lunar missions, enabling Mars missions, and offering commercial space flights.
U.S. CPI fell to 2.4% in September 2024, marking the sixth consecutive month of decline. Prices for many physical goods have actually decreased as market equilibrium has been restored following pandemic-era disruptions. This includes year-over-year price reductions in common household goods such as groceries, gasoline, and cars. However, the cumulative effects of inflation since 2020 are still evident, with overall prices having increased by about 20% over the past four years. Earlier this week, New York Fed President John Williams suggested that the recent half-point rate cut has positioned the economy for a "soft landing" – a scenario where inflation decreases without triggering a recession. Williams also endorsed the Fed's latest projections, which anticipate an additional half-point rate reduction over the year's final two meetings.
Recent economic data suggests that India's economy may be experiencing a slowdown, despite Prime Minister Narendra Modi's optimistic outlook. India's GDP growth rate eased to 6.7% between April and June, down from 7.8% in the previous quarter, marking the slowest expansion in more than a year. Other indicators also point to a potential slowdown: output in eight core industries fell in August for the first time in over three years, car sales dropped 19% year-on-year in September, and growth in Goods and Services Tax collections fell to a three-year low. Additionally, the country faces a stagnant manufacturing sector, falling real wages, and high unemployment, which stood at 7.8% in September. Despite these challenges, India remains the fastest-growing major economy, with the Reserve Bank of India maintaining its growth forecast of 7.2% for the current fiscal year.