Wednesday, August 2, 2023

AI and the Job Replacement Debate

AI Study Says Stocks Already Pricing a Job-Replacement Premium
https://www.bloomberg.com/news/articles/2023-08-02/firms-exposed-to-ai-job-streamlining-are-already-beating-the-market-study-says
Related:
Generative AI and Firm Values
https://www.nber.org/papers/w31222
Abstract
What are the effects of recent advances in Generative AI on the value of firms? Our study offers a quantitative answer to this question for U.S. publicly traded companies based on the exposures of their workforce to Generative AI. Our novel firm-level measure of workforce exposure to Generative AI is validated by data from earnings calls, and has intuitive relationships with firm and industry-level characteristics. Using Artificial Minus Human portfolios that are long firms with higher exposures and short firms with lower exposures, we show that higher-exposure firms earned excess returns that are 0.4% higher on a daily basis than returns of firms with lower exposures following the release of ChatGPT. Although this release was generally received by investors as good news for more exposed firms, there is wide variation across and within industries, consistent with the substantive disruptive potential of Generative AI technologies. 

Aided by A.I. Language Models, Google’s Robots Are Getting Smart
https://www.nytimes.com/2023/07/28/technology/google-robots-ai.html
Our sneak peek into Google’s new robotics model, RT-2, which melds artificial intelligence technology with robots.

India and the Global Supply Chain

Inside Apple's India dream
https://asia.nikkei.com/Spotlight/The-Big-Story/Inside-Apple-s-India-dream
Tech giant aims to move at least 20% of iPhone production to India as it accelerates away from China 

India can be a bigger winner in the supply chain shift from China
https://asia.nikkei.com/Opinion/India-can-be-a-bigger-winner-in-the-supply-chain-shift-from-China


Global investors pivot from flagging China to India, Vietnam
https://asia.nikkei.com/Business/Markets/Global-investors-pivot-from-flagging-China-to-India-Vietnam
China's slow economic recovery and geopolitical risks lead to change in inflows 

Tuesday, August 1, 2023

Fitch downgrades US debt

Fitch Downgrades U.S. Credit Rating
https://www.nytimes.com/2023/08/01/business/fitch-downgrade-us-credit-rating.html
The ratings agency, which lowered the U.S. long-term rating from its top mark, said debt-limit standoffs had eroded confidence in the nation’s fiscal management.
 
Fitch downgrades US debt
https://www.cnn.com/2023/08/01/business/fitch-downgrade-us-debt/index.html
Related:
https://www.wsj.com/articles/fitch-downgrades-u-s-credit-rating-56c73b89


Related:
America’s long-term fiscal sustainability challenge by Vivekanand Jayakumar, The Hill - 04/24/23
https://thehill.com/opinion/finance/3965613-americas-long-term-fiscal-sustainability-challenge/
US fiscal profligacy may create a long-term debt sustainability problem:

BOE Faces a Dilemma as Stagflation Looms

Britain’s economy is perilously close to stall speed as interest rates rise again
https://www.telegraph.co.uk/business/2023/08/01/britain-economy-perilously-close-stall-speed-interest-rates/ 

How high should Britain’s interest rates go?

Is Miami Getting Too Expensive?

Miami Is Shrinking
https://www.wsj.com/articles/miami-sees-its-first-population-drop-in-decades-e181171f
Soaring housing costs are driving many locals away despite the city’s economic boom. Miami-Dade County’s population shrank between 2019 and 2022—its first population loss over a multiyear period since at least 1970. 

Asia's Hydropolitics

ASIA'S AGE OF HYDROPOLITICS
https://asia.nikkei.com/Spotlight/Asia-s-Age-of-Hydropolitics
China as 'upstream superpower' 

Global Nursing Shortage

Countries Raid Each Others’ Health Systems in Global Battle for Nurses
https://www.wsj.com/articles/countries-raid-each-others-health-systems-in-global-battle-for-nurses-b2de0429
Shortages of medical-care staff lead to aggressive poaching worldwide, enraging poorer nations; cycling to work in Australia