China's Marriage Market

In China, Marriage Rates Are Down and ‘Bride Prices’ Are Up
https://www.nytimes.com/2023/03/26/world/asia/china-crackdown-bride-prices.html
China’s one-child policy has led to too few women. Grooms are now paying more money for wives, in a tradition that has faced growing resistance. 

AI and the Future of Finance

Introducing BloombergGPT, Bloomberg’s 50-billion parameter large language model, purpose-built from scratch for finance
https://www.bloomberg.com/company/press/bloomberggpt-50-billion-parameter-llm-tuned-finance/
 
BloombergGPT: A Large Language Model for Finance
https://arxiv.org/pdf/2303.17564.pdf
The use of NLP in the realm of financial technology is broad and complex, with applications ranging from sentiment analysis and named entity recognition to question answering. Large Language Models (LLMs) have been shown to be effective on a variety of tasks; however, no LLM specialized for the financial domain has been reported in literature. In this work, we present BloombergGPT, a 50 billion parameter language model that is trained on a wide range of financial data. We construct a 363 billion token dataset based on Bloomberg's extensive data sources, perhaps the largest domain-specific dataset yet, augmented with 345 billion tokens from general purpose datasets. We validate BloombergGPT on standard LLM benchmarks, open financial benchmarks, and a suite of internal benchmarks that most accurately reflect our intended usage. Our mixed dataset training leads to a model that outperforms existing models on financial tasks by significant margins without sacrificing performance on general LLM benchmarks. Additionally, we explain our modeling choices, training process, and evaluation methodology. As a next step, we plan to release training logs (Chronicles) detailing our experience in training BloombergGPT. 

Economists and Political Ideology

Are economists overconfident? Ideology and uncertainty in expert opinion

https://onlinelibrary.wiley.com/doi/full/10.1111/1468-4446.13001

Abstract

Economics frequently serves as an advisory discipline to policymakers, bolstered in part by its claims to a unified intellectual framework and high disciplinary consensus. Recent research challenges this perspective, providing empirical evidence that economists' professional opinions are divided by ideological commitments to either free markets on one hand or state intervention on the other. We investigate the influence of ideology in economics by examining the relation between economists' ideological commitments and the certainty with which they express their expert opinions. To examine this relationship, we analyze data from the Initiative on Global Markets Economic Experts Panel, a unique survey of 51 economists at seven elite American universities. Our results suggest that economists with ideologically patterned views report higher levels of certainty in their opinions than their less ideologically consistent peers, but this boost in confidence is limited to topics that closely pertain to the free market versus interventionism divide.

Rational/Irrational Behavior and Efficient/Inefficient Markets

Surprised by interest rate hikes? Really?
https://www.washingtonpost.com/opinions/2023/03/23/interest-rates-banks-inflation-economy/
Megan McArdle:
Herd mentality offers an explanation. It’s not entirely irrational to think that if everyone else is doing something, it must be a good idea. Moreover, the herd’s behavior can shape reality: If everyone thinks Tesla is worth a zillion dollars a share, it will be. And if everyone thinks a bank is insolvent, that bank will fail, no matter how well capitalized or soundly regulated it is.
Over the long term, markets do eventually discover, and correct, mistakes. But in the short term, the herd can run in the wrong direction for a long time. As the old Wall Street saw goes, the market can stay irrational longer than you can stay solvent.
 
NFT Bubbles by Andrea Barbon and Angelo Ranaldo
https://arxiv.org/pdf/2303.06051.pdf
Abstract
By investigating nonfungible tokens (NFTs), we provide the first systematic study of retail investor behavior through asset bubbles. Given that NFTs are recorded in public blockchains, we are able to track investor behavior over time, leading to the identification of numerous price run-ups and crashes. Our study reveals that agent-level variables, such as investor sophistication, heterogeneity, and wash trading, in addition to aggregate variables, such as volatility, price acceleration, and turnover, significantly predict bubble formation and price crashes. We find that sophisticated investors consistently outperform others and exhibit characteristics consistent with superior information and skills, supporting the narrative surrounding asset pricing bubbles.

Big Tech and S&P 500

How Big Tech Camouflaged Wall Street’s Crisis in March
https://www.nytimes.com/2023/03/31/business/tech-stocks-sp-500.html
The fate of the S&P 500 index — used by investors as a barometer for the health of corporate America, and cited by presidents as a measure of their handling of the economy — often comes down to just two companies: Apple and Microsoft.

Currency Crisis in Bolivia

Bolivia Pays Dollar Bond Coupon as Currency Crisis Mounts

https://www.bloomberg.com/news/articles/2023-03-23/bolivia-pays-dollar-bond-coupon-as-currency-crisis-mounts

Bolivia’s Currency Crisis Deepens as Dollar Become Hard to Find
https://www.bloomberg.com/news/articles/2023-03-21/bolivia-s-currency-crisis-deepens-as-dollar-become-hard-to-find

Bolivia’s Central Bank Pledges to Defend Currency Peg as Residents Scramble for Cash
https://www.bloomberg.com/news/articles/2023-03-09/central-bank-pledges-to-defend-bolivia-s-currency-peg-amid-scramble-for-dollars 

Florida - Taxes versus Climate Risks

Come to Florida for the Low Taxes, Stay for the Climate Disaster
https://www.washingtonpost.com/business/2023/03/30/people-move-to-florida-despite-hurricanes-floods-climate-change/fcd056b8-cf0a-11ed-8907-156f0390d081_story.html 

Class of 2023 - Job Market Uncertainty

The Class of 2023 Faces a Jittery Job Market: ‘The World Seems to Have Flipped on Its Head.’
https://www.wsj.com/articles/jobs-new-college-graduates-2023-labor-market-openings-7195e28
Companies from Amazon to Wayfair are tapping the brakes on their hiring of college grads this year, forcing seniors to cast a wider net as they search for that crucial first job. 

BRICS and the New World Order

BRICS and the World Order
https://www.dw.com/en/a-new-world-order-brics-nations-provide-an-alternative-to-the-west/a-65124269
 
O’Neill Urges BRICS Bloc to Expand, Challenge Dollar’s Dominance
https://www.bloomberg.com/news/articles/2023-03-28/o-neill-urges-brics-bloc-to-expand-challenge-dollar-s-dominance
 
Worried About Shadow Banking? Don’t Look at China
https://www.washingtonpost.com/business/2023/03/30/shadow-banking-don-t-look-at-china-the-us-also-has-a-problem/80fe5640-cef9-11ed-8907-156f0390d081_story.html 

Prepare for a multipolar currency world
https://www.ft.com/content/f8f3b2cd-6690-4f26-b81e-e972751c8799

The dollar is our superpower, and Russia and China are threatening it
https://www.washingtonpost.com/opinions/2023/03/24/us-dollar-strength-russia-china/

US banking woes compound China’s need for US Treasury alternatives
https://www.scmp.com/comment/opinion/article/3215802/us-banking-woes-compound-chinas-need-us-treasury-alternatives

China’s Yuan Replaces Dollar as Most Traded Currency in Russia
https://www.bloomberg.com/news/articles/2023-04-03/china-s-yuan-replaces-dollar-as-most-traded-currency-in-russia

Profile of Economist Partha Dasgupta

The Most Important Person You’ve Never Heard of Has the Answer to Everything
https://www.nytimes.com/2023/03/28/opinion/alexander-skarsgard-partha-dasgupta-economy.html
 
The Economics of Biodiversity: The Dasgupta Review
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/962785/The_Economics_of_Biodiversity_The_Dasgupta_Review_Full_Report.pdf

The Debate Surrounding Monetary Policy Lags

My Take: Shifting Monetary Policy Lags Confuse Markets and Central Bankers
https://thehill.com/opinion/finance/3921016-shifting-monetary-policy-lags-confuse-markets-and-central-bankers/ 

AI and the Future of White-Collar Jobs

A.I. May Change Everything, but Probably Not Too Quickly
https://www.nytimes.com/2023/03/31/opinion/ai-chatgpt-jobs-economy.html
Paul Krugman (2008 Nobel Prize Winner in Economics):
Like previous leaps in technology, this will make the economy more productive but will also probably hurt some workers whose skills have been devalued. Although the term “Luddite” is often used to describe someone who is simply prejudiced against new technology, the original Luddites were skilled artisans who suffered real economic harm from the introduction of power looms and knitting frames.
But this time around, how large will these effects be? And how quickly will they come about? On the first question, the answer is that nobody really knows. Predictions about the economic impact of technology are notoriously unreliable. On the second, history suggests that large economic effects from A.I. will take longer to materialize than many people currently seem to expect.

Is AI Coming for Coders First?
https://nymag.com/intelligencer/2023/03/is-ai-coming-for-coders-first.html

Tinkering With ChatGPT, Workers Wonder: Will This Take My Job?
https://www.nytimes.com/2023/03/28/business/economy/jobs-ai-artificial-intelligence-chatgpt.html
Artificial intelligence is confronting white-collar professionals more directly than ever. It could make them more productive — or obsolete. 

The Jobs Most Exposed to ChatGPT

https://www.wsj.com/articles/the-jobs-most-exposed-to-chatgpt-e7ceebf0

300 million jobs could be affected by latest wave of AI, says Goldman Sachs
https://www.cnn.com/2023/03/29/tech/chatgpt-ai-automation-jobs-impact-intl-hnk/index.html

Introducing BloombergGPT, Bloomberg’s 50-billion parameter large language model, purpose-built from scratch for finance
https://www.bloomberg.com/company/press/bloomberggpt-50-billion-parameter-llm-tuned-finance/

Create Your Own College Rankings

There’s Only One College Rankings List That Matters
https://www.nytimes.com/2023/03/27/opinion/problem-college-rankings.html
 
We Talked to 10 Graduates About Their College Regrets
https://www.nytimes.com/interactive/2023/03/27/opinion/college-choice-regrets.html
 
BUILD YOUR OWN COLLEGE RANKINGS
https://www.nytimes.com/interactive/2023/03/27/opinion/build-your-own-college-rankings.html 

Economics - Theory versus Reality

The Slow Motion Tidal Wave Consuming Our Economy
https://www.nytimes.com/2023/03/27/opinion/economy-economic-models-climate-change-demographics-deglobalization-ai.html 

Richard Bookstaber:
There’s weirdness yet to come, and a lot more than run-of-the-mill weirdness. We are entering a new epoch of crisis, a slow-motion tidal wave of risks that will wash over our economy in the next decades — namely climate change, demographics, deglobalization and artificial intelligence. Their effects will range somewhere between economic regime shift and existential threat to civilization. The risks to the economy, to the stability of our society and to civilization are enormous if we don’t get the economic models right for what’s coming.

Will the ‘Great Moderation’ Give Way to the ‘Great Volatility’? By VIVEKANAND JAYAKUMAR (SPRING 2023)
https://www.ut.edu/uploadedFiles/Academics/Business/TBESpring2023_Final.pdf 

New era of inflation will bedevil central banks and bond markets by VIVEKANAND JAYAKUMAR, The Hill - 07/01/22

https://thehill.com/opinion/finance/3543857-new-era-of-inflation-will-bedevil-central-banks-and-bond-markets/

Have misguided policies led to recent asset bubbles and boom-bust cycles? BY VIVEKANAND JAYAKUMAR, The Hill - 02/16/21

https://thehill.com/opinion/finance/538921-have-misguided-policies-led-to-recent-asset-bubbles-and-boom-bust-cycles/

The Debate Surrounding Globalization

The World Will Regret Its Retreat from Globalization
https://foreignpolicy.com/2023/03/24/trade-economy-globalization-united-states-china-ira-chips-reshoring-decoupling-industry-china/
 
America’s Zero-Sum Economics Doesn’t Add Up
https://foreignpolicy.com/2023/03/24/economy-trade-united-states-china-industry-manufacturing-supply-chains-biden/ 

David Autor - The Enduring Economic and Political Consequences of the China Trade Shock

https://youtu.be/F6QP3wTFafE

 

Caroline Freund - What Future for Globalization?

https://youtu.be/2-yGe9pfitQ

Readings on Consciousness

Nicholas Humphrey’s Beautiful Theory of Mind
https://www.newyorker.com/news/annals-of-inquiry/nicholas-humphreys-beautiful-theory-of-mind
In his new book, “Sentience,” a neuropsychologist argues that consciousness evolved to make us feel that life is worth living. 

Related Readings:

http://www.theatlantic.com/science/archive/2016/06/how-consciousness-evolved/485558/

http://www.nytimes.com/2014/10/12/opinion/sunday/are-we-really-conscious.html

http://www.newyorker.com/tech/elements/anatomy-attention

Military Spending Resurgence

An Anxious Asia Arms for a War It Hopes to Prevent
https://www.nytimes.com/2023/03/25/world/asia/asia-china-military-war.html
 
From Rockets to Ball Bearings, Pentagon Struggles to Feed War Machine
https://www.nytimes.com/2023/03/24/us/politics/military-weapons-ukraine-war.html
 
As traditional weapons suppliers like the U.S. face wartime production shortages, South Korea has stepped in to fill the gap, while trying not to provoke Moscow.
https://www.nytimes.com/2023/03/05/world/asia/ukraine-south-korea-arms.html 

France’s arms heartland tiptoes into the war economy
https://www.politico.eu/article/eu-france-defense-arms-heartland-nexter-war-economy-ukraine/

Ike Eisenhower (1961):
https://www.archives.gov/milestone-documents/president-dwight-d-eisenhowers-farewell-address
But now we can no longer risk emergency improvisation of national defense; we have been compelled to create a permanent armaments industry of vast proportions. . . . This conjunction of an immense military establishment and a large arms industry is new in the American experience. . . .Yet we must not fail to comprehend its grave implications. . . . In the councils of government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military-industrial complex. The potential for the disastrous rise of misplaced power exists and will persist.

Financial Volatility

How Options-Hedging Turbocharged Oil Volatility
https://www.wsj.com/articles/how-options-hedging-turbocharged-oil-volatility-334cef5b
 
Stock-option traders are creating explosive volatility in the market.
https://www.marketwatch.com/story/every-day-is-a-battle-how-option-traders-drive-explosive-stock-market-swings-8656fa69
Over the past year, trading in so-called “zero day to expiration” — or “0DTE” — contracts linked to the S&P 500 has surged, according to data from the Cboe Options Exchange, where many of these contracts are traded. They now account for more than 40% of total trading volume in S&P 500 options, according to data furnished by the exchange. 

China's Economy - Be Wary of Simplistic Narratives

How China Keeps Putting Off Its ‘Lehman Moment’
https://www.nytimes.com/2023/03/26/opinion/china-finance-banking-evergrande-crisis.html
What the Doomsayers Still Don’t Get About China’s Economy
 
Why Chinese Apps Are the Favorites of Young Americans
https://www.wsj.com/articles/why-chinese-apps-are-the-favorites-of-young-americans-a9a5064a
It isn’t just the algorithms, but lessons from a cutthroat culture 

Banking Sector Woes in US and EU

How Bank Oversight Failed: The Economy Changed, Regulators Didn’t
https://www.wsj.com/articles/how-bank-oversight-failed-the-economy-changed-regulators-didnt-7dbb842d

In Today’s Banking Crisis, Echoes of the ’80s
https://www.wsj.com/articles/in-todays-banking-crisis-echoes-of-the-80s-thrift-delayed-recognition-risk-taking-deposit-insurance-svb-signature-cfdd2b37

 
Banking failures put Fed under yet another harsh political spotlight
https://www.washingtonpost.com/business/2023/03/25/federal-reserve-congress-politics-svb/
 
Europe is in denial about the banking crisis engulfing it
https://www.telegraph.co.uk/business/2023/03/25/europe-denial-banking-crisis-engulfing/ 

The GOP Base

How Working-Class White Voters Became the GOP’s Foundation
https://www.theatlantic.com/politics/archive/2023/03/working-class-white-voters-gop-house-agenda/673500/
Republicans now control most of the House seats in districts where the median income trails the national level of nearly $65,000 annually. 

End of Swiss Exceptionalism

The era of Swiss exceptionalism is over.
https://www.telegraph.co.uk/business/2023/03/24/era-swiss-exceptionalism/
The country’s business model as banker for the global elites has crashed and burned

A very Swiss identity crisis
https://www.ft.com/content/e74c0556-5e60-4ab2-9876-7ac687b1d021

How Stable is the West?

Why the French can’t stop protesting as the ‘revolutionary itch’ returns with a vengeance
https://www.telegraph.co.uk/world-news/2023/03/24/why-french-cant-stop-protesting-revolutionary-itch-returns-vengeance/
The call to arms for a new 1789 is based on a laughably anodyne change: raising France’s legal state retirement age from 62 to 64

Migration to Italy is soaring. And it’s still the off-season.

https://www.washingtonpost.com/world/2023/03/28/italy-migrants-sea-winter/

The U.K. is experiencing historic strikes. These stories explain why.
https://www.washingtonpost.com/world/2023/03/02/uk-strikes-inflation-pay/

 
A Trump Rally, a Right-Wing Cause and the Enduring Legacy of Waco
https://www.nytimes.com/2023/03/24/us/politics/donald-trump-waco-branch-davidians.html

Armed with AR-15s, some extremist groups are bracing for civil unrest
https://www.washingtonpost.com/nation/interactive/2023/ar-15-armed-extremist-militia-groups/

Related:
https://www.telegraph.co.uk/news/2023/03/25/america-consumed-terrifying-new-madness/

How Deutsche Bank caught fire as Europe’s banking crisis spreads
https://www.telegraph.co.uk/business/2023/03/24/how-deutsche-bank-caught-fire-europes-banking-crisis-spreads/
 
Credit Suisse: Bank rescue damages Switzerland's reputation for stability
https://www.bbc.com/news/business-65009996

Switzerland’s Incredible Shrinking Financial Sector

https://www.bloomberg.com/opinion/articles/2023-03-24/switzerland-s-banking-sector-has-been-shrinking-long-before-credit-suisse

Tax Burden Across US States

Actual Tax Burden Across US States
https://wallethub.com/edu/best-worst-states-to-be-a-taxpayer/2416 

Wild Swings in the Treasury Bond Market

‘Bonkers’ Bond Trading May Be Sending a Grim Signal About the Economy
https://www.nytimes.com/2023/03/24/business/treasury-market-swings-economic-signal.html 

The Pros Fail to Meet the Moment with Bond ETFs
https://www.bloomberg.com/opinion/articles/2023-03-23/personal-finance-fund-managers-fail-to-meet-the-moment-with-bond-etfs

Beware of Earnings Manipulation

Accounting-Fraud Indicator Signals Coming Economic Trouble
https://www.wsj.com/articles/accounting-fraud-indicator-signals-coming-economic-trouble-506568a0
A tool to identify corporate earnings manipulation finds the most risk in over 40 years 

A Strong Case for CBDCs

The Simplest Fix for Banking
https://www.project-syndicate.org/commentary/central-bank-digital-currencies-end-bank-runs-excessive-risk-taking-by-jan-eeckhout-2023-03
JAN EECKHOUT:
Following the latest banking crisis, monetary authorities should seriously consider how modern digital technologies could be used to avert such problems in the future. A central bank digital currency would both eliminate many barriers to financial transactions and end the risk of bank runs once and for all. 

The Interest Rate Debate in US and UK

The Fed Has Targeted 2% Inflation. Should It Aim Higher?
https://www.nytimes.com/2023/03/24/business/inflation-federal-reserve-interest-rates.html

As Fed Nears Rate Peak, Be Careful What You Wish For
https://www.bloomberg.com/opinion/articles/2023-03-22/as-federal-reserve-nears-rate-peak-be-careful-what-you-wish-for
 
Bank of England raises interest rates to 4.25pc and warns of further pain
https://www.telegraph.co.uk/business/2023/03/23/bank-england-raises-interest-rates-425pc-warns-pain/
The Bank of England made a historic error that must not be forgotten
https://www.telegraph.co.uk/business/2023/03/23/bank-england-made-historic-error-must-not-forgotten/ 

Related:

The high price of low interest rates
https://www.spectator.co.uk/article/the-high-price-of-low-interest-rates/

China and the West

China’s Rise Relied on Ties to the West, Which Xi Is Now Loosening
https://www.nytimes.com/2023/03/23/business/china-xi-jinping-russia-putin.html
 
China’s Economic Lifeline to Russia Gives Beijing Upper Hand
https://www.wsj.com/articles/chinas-economic-lifeline-to-russia-gives-beijing-upper-hand-8d58c151 

Crypto - Risks Remain

Beware the ‘sensible’ crypto crowd — they’re worse than the fanatics
https://www.ft.com/content/29605ca8-494a-4762-bedc-43e3671226ab
The strait-laced, earnest types threaten to legitimise a high-risk, opaque and ill-understood industry

Crypto Is Mostly Over. Its Carbon Emissions Are Not.
https://www.theatlantic.com/science/archive/2023/03/crypto-bitcoin-mining-carbon-emissions-climate-change-impact/673468/
And it is America’s problem now. After China clamped down on crypto mining in 2021, such computing work increased in the United States. Miners set up shop in communities with low energy prices. And owners of unprofitable power-generation infrastructure, such as waste-coal-burning power plants, opened up crypto-mining operations to create another revenue stream. These companies have put a lot of money into their hardware and their physical space, and they will continue mining until they are actively losing money.

Crash Course: Cryptocurrencies Vs. Reality
https://www.bloomberg.com/opinion/articles/2023-02-28/crash-course-crypto-reality-sbf-and-the-winklevoss-twins
 
We Are All Gamblers Now, From Sports to Crypto
https://www.washingtonpost.com/business/we-are-all-gamblers-nowfrom-sports-to-crypto/2023/03/02/53779c7c-b90a-11ed-b0df-8ca14de679ad_story.html

Nothing Redeems Crypto

https://www.wsj.com/articles/nothing-redeems-cryptocurrency-ftx-sec-regulation-carbon-mining-hardware-gambling-tokens-exchange-dee0c358
Part chlorofluorocarbon, part cocaine, part bearer bond. We need policies that will eliminate it. 

The Crypto Collapse and the End of Magical Thinking That Infected Capitalism
https://www.nytimes.com/2023/01/16/opinion/the-crypto-collapse-magical-thinking-capitalism.html
Harvard’s Mihir Desai notes:
I have come to view cryptocurrencies not simply as exotic assets but as a manifestation of a magical thinking that had come to infect part of the generation who grew up in the aftermath of the Great Recession — and American capitalism, more broadly.
For these purposes, magical thinking is the assumption that favored conditions will continue on forever without regard for history. It is the minimizing of constraints and trade-offs in favor of techno-utopianism and the exclusive emphasis on positive outcomes and novelty. It is the conflation of virtue with commerce. 

The Real Future of Digital Cash
https://www.washingtonpost.com/business/2023/03/09/digital-cash-move-over-stablecoin-a-new-token-is-coming/7458adc2-bec4-11ed-9350-7c5fccd598ad_story.html

Miami and New York’s Crypto CityCoins Meet Quiet Demise
https://www.bloomberg.com/news/articles/2023-03-21/miami-and-new-york-s-crypto-citycoins-meet-with-a-quiet-demise

Fed's BTFP Program

Banks Are Borrowing More from the Fed: What to Know
https://www.nytimes.com/2023/03/23/business/economy/federal-reserve-discount-window.html

Federal Reserve Board announces it will make available additional funding to eligible depository institutions to help assure banks have the ability to meet the needs of all their depositors
https://www.federalreserve.gov/newsevents/pressreleases/monetary20230312a.htm
 
Bank Term Funding Program: Understanding Borrowing from the Federal Reserve Bank
https://www.natlawreview.com/article/bank-term-funding-program-understanding-borrowing-federal-reserve-bank 

Return of the Malthusians

The Malthusians Are Back
https://www.theatlantic.com/ideas/archive/2023/03/population-control-movement-climate-malthusian-similarities/673450/
Climate activists who worry that the world has too many people are joining an ugly tradition.
 
Related:
https://vivekjayakumar.blogspot.com/2023/01/ageing-planet-big-picture.html 

Banking Sector Crisis - Short-Term and Long-Term Issues

A New Chapter of Capitalism Emerges from the Banking Crisis
https://www.bloomberg.com/opinion/articles/2023-03-22/global-banking-crisis-opens-a-new-chapter-of-capitalism
The idea that finance is an arm of the state is back — and global banking is likely to be reshaped by it.

Europe’s banks in danger of another doom loop, with perilously little protection
https://www.telegraph.co.uk/business/2023/03/22/europes-banks-danger-another-doom-loop-perilously-little-protection/
 
Bank Crisis Could Cast Pall Over Commercial Real Estate Market
https://www.nytimes.com/2023/03/22/business/svb-signature-commercial-real-estate.html
The market hadn’t fully rebounded from the pandemic. Some worry that another slowdown could add to fears of a recession.
 
SVB-Fueled Turmoil Junks Lessons of the Global Financial Crisis
https://www.wsj.com/articles/svb-fueled-turmoil-junks-lessons-of-the-global-financial-crisis-e3240816 

A Surprising Rebound in Housing

Buyers pour into housing market as prices drop for first time since 2012
https://www.washingtonpost.com/business/2023/03/21/housing-prices/ 

Home Prices Fell in February for First Time in 11 Years
https://www.wsj.com/articles/home-prices-fell-in-february-for-first-time-in-11-years-73df0107

AI/ChatGPT - Hype and Reality

I Witnessed Magic, and It’s the Future
https://www.nytimes.com/2023/03/21/opinion/artificial-intelligence-chatgpt.html
Tom Friedman notes:
The last time we invented a technology this powerful we created nuclear energy — it could be used to light up your whole country or obliterate the whole planet. But the thing about nuclear energy is that it was developed by governments, which collectively created a system of controls to curb its proliferation to bad actors — not perfectly but not bad.
A.I., by contrast, is being pioneered by private companies for profit. The question we have to ask, Craig argued, is how do we govern a country, and a world, where these A.I. technologies “can be weapons or tools in every domain,” while they are controlled by private companies and are accelerating in power every day? And do it in a way that you don’t throw the baby out with the bathwater. 

Why All the ChatGPT Predictions Are Bogus
https://www.theatlantic.com/newsletters/archive/2023/03/chatgpt-fire-steam-engine-lightbulb-sat/673451/

Argentina’s Inflation Problem Stumped ChatGPT
https://www.washingtonpost.com/business/2023/03/22/argentina-s-inflation-problem-stumped-chatgpt/934b8316-c8b1-11ed-9cc5-a58a4f6d84cd_story.html

Credit Suisse and the AT1 Bond Scandal

UBS, Switzerland and Those Angry AT1 Investors
https://www.bloomberg.com/opinion/articles/2023-03-23/ubs-switzerland-and-those-angry-at1-investors

'Very emotional' Asian AT1 investors look to claw back Swiss losses

https://asia.nikkei.com/Business/Finance/Very-emotional-Asian-AT1-investors-look-to-claw-back-Swiss-losses
 
AT1 bonds and Credit Suisse: 4 things to know
https://asia.nikkei.com/Business/Finance/AT1-bonds-and-Credit-Suisse-4-things-to-know

What are AT1 bonds and why are Credit Suisse’s now worthless?
https://www.cnn.com/2023/03/20/investing/credit-suisse-at1-bond-write-down-explainer
 
Credit Suisse Write-Off Upends European Bank Capital Bonds
https://www.wsj.com/articles/credit-suisse-write-off-upends-european-bank-capital-bonds-e01d2010 

Bank Bailouts - Setting Bad Precedents

Life’s Certainties: Death, Taxes and Bailouts
https://www.wsj.com/articles/lifes-certainties-death-taxes-and-bailouts-fed-fdic-silicon-valley-bank-insurance-btfp-run-ab46d1a8
The Fed stuck to its playbook with Silicon Valley Bank. That may guarantee the next crisis.

The Fed's Dilemma

The Fed Can Fight Both Inflation and Bank Contagion
https://www.washingtonpost.com/business/2023/03/21/the-fed-can-fight-both-inflation-and-contagion/ac9138cc-c7c9-11ed-9cc5-a58a4f6d84cd_story.html 

Is Technology Making Us Miserable?

Your Data Is Diminishing Your Freedom
https://www.nytimes.com/interactive/2023/03/20/magazine/colin-koopman-interview.html
Colin Koopman:
It creates a big democratic deficit. It undermines our sense of our own ability to engage democratically in some of the basic terms through which we’re living with others in society. A lot of that is not an effect of the technologies themselves. A lot of it is the ways in which our culture tends to want to think of technology, especially information technology, as this glistening, exciting thing, and its importance is premised on its being beyond your comprehension. But I think there’s a lot we can come to terms with concerning, say, a database into which we’ve been loaded.

Competing With Robots Is Making Work Worse
https://www.bloomberg.com/opinion/articles/2023-03-20/competing-with-ai-in-the-workplace-is-fueling-incivility-at-work 

Singapore versus Switzerland

Are the Ultra-Rich Ready for Singapore After Credit Suisse?
https://www.bloomberg.com/opinion/articles/2023-03-20/credit-suisse-are-the-ultra-rich-ready-for-singapore-and-hong-kong
 
Singapore and Hong Kong vie to be the Caymans of Asia
https://www.ft.com/content/88e20280-bb6e-4209-ae76-d7183c60ff62 

Examples of Regulatory Capture

Signature Bank Threw a Fundraiser for the Congressman Now Probing How It Failed
https://www.bloomberg.com/news/articles/2023-03-20/signature-threw-a-fundraiser-for-mchenry-just-before-it-crumbled 

Tech Lobbyists Don’t Want States to Let You Sue Over Privacy Violations
https://www.bloomberg.com/news/articles/2023-03-20/big-tech-lobbyists-are-fighting-strict-data-privacy-laws-state-by-state

India's Investment in Physical Infrastructure

India is getting an eye-wateringly big transport upgrade
https://www.economist.com/asia/2023/03/13/india-is-getting-an-eye-wateringly-big-transport-upgrade
Long known for its interminable, rattling train journeys, snarled roads and grotty airports, the country is experiencing an infrastructural makeover on a scale unprecedented outside China. It will transform Indians’ ability to travel, by rail, road and air; and thus to intermingle and do business. The government of Narendra Modi hopes it will remove one of the biggest constraints on the rapid economic growth that India desperately needs in order to meet the aspirations of its young, fast-growing population. 

Investcorp Joins Global Funds in Betting on Indian Warehouses
https://www.bloomberg.com/news/articles/2023-03-16/india-warehouses-investcorp-panattoni-join-global-funds-in-logistics-bets
Logistics sector is booming amid Modi’s manufacturing push

Can the AI Boom Revive SFO?

AI is reviving San Francisco’s tech scene. Welcome to ‘Cerebral Valley.’
https://www.washingtonpost.com/technology/2023/03/15/ai-cerebral-valley-hacker-house/ 

UK Policy Reforms

Sunak’s Pivot Away From ‘Global Britain’ Makes Friends on World Stage
https://www.nytimes.com/2023/03/19/world/europe/rishi-sunak-global-britain.html
Prime Minister Rishi Sunak has dropped Boris Johnson’s bombastic approach to foreign policy, echoing the new British leader’s personal style and reflecting the country’s changed global status. 

U.K. Prime Minister Rishi Sunak Tries Free-Market Recipe to Fix Britain’s Woes
https://www.wsj.com/articles/u-k-prime-minister-rishi-sunak-tries-free-market-recipe-to-fix-britains-woes-2aa177b8 

ChatGPT Usage in Higher Education

How to Learn and Teach Economics with Large Language Models, Including GPT
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4391863
 
Using AI to Implement Effective Teaching Strategies in Classrooms: Five Strategies, Including Prompts
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4391243 

Breaking Down the "Paper Ceiling"

Stop requiring college degrees for jobs that don’t need them
https://www.vox.com/policy/23628627/degree-inflation-college-bacheors-stars-labor-worker-paper-ceiling
Employers are finally tearing down the “paper ceiling” in hiring. 

Related:
https://vivekjayakumar.blogspot.com/2023/02/college-is-not-only-path-to-career.html
https://vivekjayakumar.blogspot.com/2023/03/skill-mismatch.html

Seeking the Good Life in Europe

Americans Head to Europe for the Good Life on the Cheap
https://www.nytimes.com/2023/03/17/realestate/europe-homes-sale-americans-lisbon-barcelona.html
Home sales to Americans have increased significantly, giving them a chance to enjoy a lifestyle they could not afford in major U.S. cities, but the influx risks upsetting local residents. 

GCC Competition

Inside Saudi Arabia’s plan to take down Emirates and Qatar
https://www.telegraph.co.uk/business/2023/03/18/inside-saudi-arabias-plan-take-emirates-qatar/
The launch of Riyadh Air is the latest twist in Gulf rivalries, as the Saudi Kingdom vies to take on the UAE’s Emirates airlines, Abu Dhabi flag carrier Etihad and Qatar Airways. 

Why Congress Doesn't Work

The Four Quadrants of American Politics
https://www.theatlantic.com/politics/archive/2023/03/house-of-representatives-equity-research-institute-usc-analysis/673422/ 

Want Better Government? Pay Bureaucrats More
https://www.washingtonpost.com/business/2023/03/19/want-better-government-pay-bureaucrats-more/813d479e-c650-11ed-9cc5-a58a4f6d84cd_story.html
The key to attracting more good people to public service is to make the jobs less political and more lucrative.

Changes to CFA Exams

CFA Institute Makes ‘Biggest Single Package of Changes’ in Its History
https://www.institutionalinvestor.com/article/b8xwtfnpmwb149/CFA-Institute-Makes-Biggest-Single-Package-of-Changes-in-Its-History
 
CFA Revised Exam Cuts Study Time, Stresses Practical Skills
https://www.bloomberg.com/news/articles/2023-03-17/cfa-overhauls-exam-to-cut-study-time-emphasize-practical-skills 

Evolution of Undergraduate Business Schools

2023’s Undergraduate Business Schools to Watch
https://poetsandquantsforundergrads.com/news/2023s-undergraduate-business-schools-to-watch/ 

World’s Most Innovative Companies

THE WORLD'S MOST INNOVATIVE COMPANIES OF 2023
https://www.fastcompany.com/most-innovative-companies/list
 
Purdue University named No. 16 among World’s Most Innovative Companies:
This university is addressing the shortage of U.S. semiconductor engineers
https://www.fastcompany.com/90850198/purdue-university-filling-need-for-us-semiconductor-engineers
Purdue University launched a unique semiconductor degrees program in partnership with some of the world’s top chip-manufacturing companies. 

Will Tech Sector Pain Spread?

Pain In the Tech Industry Is Beginning to Hit the Rest of Us
https://www.wsj.com/articles/whythe-tech-industrys-pain-is-spreading-df6ff087 

The Cost of Elder Care

Senior care is crushingly expensive. Boomers aren’t ready.
https://www.washingtonpost.com/business/2023/03/18/senior-care-costs-too-high/ 

Customer Care - Vanishing Phone Support

Vanishing phone customer support is driving us all insane
https://www.washingtonpost.com/opinions/2023/03/07/phone-customer-support-disappearing/ 

Significance of Bank Balance Sheets

Why People Are Worried About Banks
https://www.nytimes.com/interactive/2023/03/18/business/why-people-are-worried-about-banks.html
 
Big banks may get bigger as crisis swamps ‘too big to fail’ worries
https://www.washingtonpost.com/us-policy/2023/03/18/big-banks-silicon-valley-bank/

The Fed’s Balance Sheet Looks Like Silicon Valley Bank’s
https://www.nytimes.com/2023/03/17/opinion/silicon-valley-bank-federal-reserve.html
Kupiec, who worked for the Fed for 10 years, said the Fed’s losses are the result of a bond-buying program — several rounds of what’s known as “quantitative easing” — that went beyond what was needed or what Congress envisioned. …
Kupiec worries that the Fed’s solution to chronic losses could be inflationary, pointing me to a 2014 paper by Marvin Goodfriend, who was an economist at Carnegie Mellon University. “A period in which the central bank is seen as having to create reserves (to pay interest on its liabilities) to stabilize the purchasing power of money will rightly unnerve and very possibly unhinge inflation expectations,” Goodfriend wrote. 

Lessons from the Iraq War

20 Years On, a Question Lingers About Iraq: Why Did the U.S. Invade?
https://www.nytimes.com/2023/03/18/world/middleeast/iraq-war-reason.html

The real lesson of the Iraq invasion? Beware spies and allies who would drag you to war
https://www.theguardian.com/commentisfree/2023/mar/17/iraq-war-spies-labour-invasion-conflict
 
The Lessons Not Learned from Iraq
https://foreignpolicy.com/2023/03/17/iraq-war-anniversary-lessons-bush-biden-afghanistan/
Twenty years on, the war still shapes policy—mostly for the worse.
 
Iraq and the Pathologies of Primacy
https://www.foreignaffairs.com/united-states/iraq-and-pathologies-primacy
The Flawed Logic That Produced the War Is Alive and Well 

Indo-Japanese Ties - The China Angle

Japan and India must draw closer to check Chinese expansionism
https://asia.nikkei.com/Opinion/Japan-and-India-must-draw-closer-to-check-Chinese-expansionism
Relationship central to Indo-Pacific region's power equilibrium and stability 

Banking Crisis and Recession Risk

Bank Failures, Like Earlier Shocks, Raise Recession Odds
https://www.wsj.com/articles/bank-failures-like-earlier-shocks-raise-odds-of-recession-beb1e376 

Banking Crisis Hangs Over Economy, Rekindling Recession Fear

https://www.nytimes.com/2023/03/17/business/economy/economy-banks-recession.html 

Purdue Basketball

Purdue Favors Old Basketball Ideas. Will It Keep Working?
https://www.nytimes.com/2023/03/17/sports/ncaabasketball/zach-edey-purdue.html
Trey Kaufman-Renn, a redshirt freshman on the team who serves as the backup to Edey, unwinds by reading Immanuel Kant and Jeremy Bentham. “Descartes is probably my favorite,” Kaufman-Renn, a dedicated philosophy major and aspiring lawyer, said before a practice. “I’ve already read Descartes’ ‘Meditations,’ but we’re going over it again.” He said he planned to take the book on the road for the postseason. 

The Pros and Cons of Having Kids

Is it worth having kids?

Pricey Child Care Is Keeping Many Parents Out of the Workforce
https://www.wsj.com/articles/pricey-child-care-is-keeping-many-parents-out-of-the-workforce-1923f4dd

Long Term Shifts

Low Rates Were Meant to Last. Without Them, Finance Is In for a Rough Ride.
https://www.nytimes.com/2023/03/16/business/economy/interest-rates-silicon-valley-bank.html
 
Will the ‘Great Moderation’ Give Way to the ‘Great Volatility’? By VIVEKANAND JAYAKUMAR
https://www.ut.edu/uploadedFiles/Academics/Business/TBESpring2023_Final.pdf 

New era of inflation will bedevil central banks and bond markets by VIVEKANAND JAYAKUMAR, The Hill - 07/01/22

https://thehill.com/opinion/finance/3543857-new-era-of-inflation-will-bedevil-central-banks-and-bond-markets/

Skill Mismatch

More Students Are Turning Away from College and Toward Apprenticeships
https://www.wsj.com/articles/more-students-are-turning-away-from-college-and-toward-apprenticeships-15f3a05d
Some white-collar training programs have become as selective as Ivy League universities.
 
A $100 Billion Bet on Semiconductors Hinges on Remaking Upstate New York’s Workforce
https://www.wsj.com/articles/a-100-billion-bet-on-semiconductors-hinges-on-remaking-upstate-new-yorks-workforce-b063b67d
Micron plans to hire 9,000 employees at a new suburban Syracuse campus amid shortage of skilled workers. 

Silicon Valley Bank Collapse - Useful Readings

Ezra Klein notes
https://www.nytimes.com/2023/03/18/opinion/svb-banks-change.html
Regulators did nothing, even though Silicon Valley Bank’s woes had been widely noticed. Bank managers failed at the basic work of hedging against the risk of interest rates rising. Midsize banks, including Silicon Valley Bank itself, successfully lobbied Congress and the Trump administration to be exempted from the regulations attached to too-big-to-fail banks. Venture capitalists sparked a needless panic that annihilated an institution central to their own industry. The Federal Reserve ignored inflation for too long, and the whiplash of its response has become a risk factor all its own.

Inside the Collapse of Silicon Valley Bank

https://www.nytimes.com/2023/03/14/business/silicon-valley-bank-gregory-becker.html
While its leader extolled innovation and the future of tech, the bank paid less attention to risk management and was caught flat-footed by economic change.

How SVB ‘Profited’ From Interest-Rate Risk
https://www.wsj.com/articles/how-svb-profited-from-interest-rate-risk-accounting-rules-deposit-fdic-federal-reserve-coupon-held-to-maturity-ec43418a
SVB held tens of billions of dollars in long-term government bonds. On its face, this may seem like a prudent investment for a bank, but Treasury securities are riskless only when held to maturity. If you have to sell before then, you can easily lose money if market rates have risen since you first purchased the bond. For example, buying a 10-year U.S. Treasury bond with a 2% coupon at par and holding it for 10 years earns you 2% per annum. But if you sell early and rates have jumped—say, 4% since you bought the bond—then the price will have declined to about $838 per $1,000 face value, meaning you incur a loss of $162 per $1,000 bond.

Why Didn’t Anyone Do Anything About Silicon Valley Bank?

https://www.theatlantic.com/ideas/archive/2023/03/silicon-valley-bank-collapse-predicted-natasha-sarin/673400/
Federal agencies’ assessments of banks’ stability leave a lot out, a former Treasury Department official explains.

Federal Reserve and Lawmakers Eye Bank Rules After Collapse
https://www.nytimes.com/2023/03/15/business/economy/silicon-valley-bank-federal-reserve-regulation.html

Banks are designed to fail — and they do
https://www.ft.com/content/09bfbb8d-22f5-4c70-9d85-2df7ed5c516e

Banking Is Always a Risky Business
https://www.wsj.com/articles/banking-is-always-a-risky-business-fdic-silicon-valley-bank-deposit-insurance-panic-bank-run-2c276cd1

There Were a Few Savvy Investors Who Saw Silicon Valley Bank’s Collapse Coming

https://nymag.com/intelligencer/2023/03/a-few-investors-saw-silicon-valley-banks-collapse-coming.html
 
The Fed Might ‘Fix’ the Economy by Breaking Banks
https://nymag.com/intelligencer/2023/03/svb-silicon-valley-bank-federal-reserve-inflation-interest-rates.html

SVB shows that there are few libertarians in a financial foxhole

https://www.ft.com/content/ebba73d9-d319-4634-aa09-bbf09ee4a03b
Like banking titans in 2008, tech tycoons favour the privatisation of profits and the socialisation of losses

What Is the Fed Discount Window and Why Are Banks Using It So Much?
https://www.washingtonpost.com/business/2023/03/17/what-is-the-fed-discount-window-why-are-banks-using-it-so-much/f7c07198-c4de-11ed-82a7-6a87555c1878_story.html

What triggered Silicon Valley Bank’s collapse? BY VIVEKANAND JAYAKUMAR, The Hill, 03/14/23
https://thehill.com/opinion/finance/3898758-what-triggered-silicon-valley-banks-collapse/ 

On a Lighter Note (the silliness of American politics in full display):
Republicans Blame Silicon Valley Bank Failure on ‘Wokeness’. Buying too many Treasury bonds is extremely woke, obviously.

https://nymag.com/intelligencer/2023/03/republicans-blame-silicon-valley-bank-failure-on-wokeness.html 

History Lesson: Insuring Bank Deposits

The Silicon Valley Bank Rescue Isn’t What Glass and Steagall Had in Mind
https://www.nytimes.com/2023/03/15/opinion/silicon-valley-bank-rescue-glass-steagall-act.html
Roger Lowenstein:
In the rescue of S.V.B. on Friday and of Signature Bank in New York two days later, the F.D.I.C. overtly ignored the cap and rescued all depositors, irrespective of size. This is a breathtaking leap.
Rescued seven-figure depositors were primarily venture companies steeped in the ideology of investing. The first plank of capitalism is that it entails risk. You cannot sensibly invest without assessing the chance for loss. If venture firms relied on groupthink rather than financial due diligence, that was their doing. In the case of Signature, which was exposed to the crypto industry, the rescue probably bailed out gamblers on speculative assets.
 
How Washington Decided to Rescue Silicon Valley Bank’s Depositors
https://www.nytimes.com/2023/03/14/us/politics/inside-silicon-valley-bank-rescue.html
Officials were initially unsure about the need for the measures they eventually announced to shore up the financial system, but changed their minds quickly. 

Telegraph’s Jeremy Warner notes:
https://www.telegraph.co.uk/business/2023/03/15/return-bailouts-shows-capitalism-effectively-dead/
It's always the same old story. Whatever the safeguards, however big the required capital and liquidity buffers, when push comes to shove there is only one choice that beleaguered governments can make when faced by a full-on financial crisis.
You can either underwrite the system, the finance minister will be told by his advisers as the maelstrom builds, or you can face chaos in the markets the following morning and certain defeat come the next election for the economic devastation so caused.
For the bankers at the centre of it all, it's a two-way bet. The profits and gains of finance are privatised, but the losses are socialised – heads I win, tails you lose.

Tech Exceptionalism - A Myth?

The End of Silicon Valley Bank—And a Silicon Valley Myth
https://www.theatlantic.com/ideas/archive/2023/03/silicon-valley-bank-collapse-banking-crisis-wokeness-venture-capital/673394/
 
Silicon Valley Was Unstoppable. Now It’s Just a House of Cards.
https://www.theatlantic.com/technology/archive/2023/03/silicon-valley-bank-venture-capital-start-up-collapse/673381/
The bank debacle is exposing the myth of tech exceptionalism.

SVB collapse heralds end of the free money tech boom
https://www.telegraph.co.uk/business/2023/03/14/svb-collapse-heralds-end-free-money-tech-boom/