From Cnet, September 17:
Don't let work stop you from enjoying Coraline or a Jason Statham marathon at your 9-to-5.
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Next up, don't let return-to-office cut into your day-drinking
Fed Minutes: "The Case for Getting Drunk at Work"
Wednesday, September 17, 2025
"Bored at Work? Tubi Wants to Help You Secretly Watch TV on the Job"
"Flying cars crash into each other and catch fire in China"
From The Telegraph via Yahoo News, September 17:
Two flying cars have collided during an air show rehearsal in China designed as a showcase for the technology.
After the mid-air crash, one of the vehicles fell to the ground and caught fire on impact, with reports that a pilot was injured.
Footage circulating on Chinese state-run media showed the two futuristic vehicles performing air stunts in close formation. The video then cuts to a fire engulfing the wreckage of one of the vehicles as ambulances race to the scene.
The accident occurred on Tuesday in Changchun, in the northeastern province of Jilin, as the city geared up for a five-day air show to begin Friday.
The flying cars, also known as electric vertical take-off and landing (eVTOL) vehicles, were developed by Xpeng AeroHT, one of the largest flying car companies in Asia and a subsidiary of Chinese electric vehicle (EV) giant Xpeng.
The company blamed the collision on “insufficient spacing”....
....MUCH MORE
“Insufficient spacing”, that's one way to put it.
Fed Rate Cut: Analysts React
Back to ZeroHedge for the closer, September 17:
Wall Street Reacts To Powell's "Risk-Management" Rate Cut
....And while Powell is scrambling to preserve some credibility (especially since exactly one year ago he cut 50bps when the economy was much stronger), here is a snapshot of some of the first comments hitting the tape:
Ali Jaffery, CIBC Capital Markets
Peering through the dot plot, there’s more division than today’s rate-cut vote suggests. The FOMC is likely divided on its views on the US economy, with some favoring faster easing on risks to the job market (and perhaps other motivations as well), but others are clearly worried about managing through a stagflationary outlook, which is why the overall pace of rate cuts is still far from aggressive. Chair Powell has a tough act to follow in trying to speak on behalf of the committee.
Seema Shah, chief global strategist, Principal Asset Management:
Next year’s dot plot is a mosaic of different perspectives and is an accurate reflection of a confusing economic outlook, muddied by labor supply shifts, data measurement concerns, and government policy upheaval and uncertainty. Overall, though, today’s measured 25 basis point cut allows the Fed to get ahead of a slowdown without overreacting to early signs of strain.
Ira Jersey, Bloomberg Intelligence
In the press conference, will Powell push against the relatively dovish tone? The last few meetings, the opening remarks have been quite neutral, as we showed in our NLP model earlier in this blog. It seems likely he’s at least a tad more dovish, and if not that could be somewhat surprising to the market... The skew of the Dot plot remains for slower cuts this year, but the median year-end 2026 dot not only moved lower, but there are now five members who see rates below 3%. We had thought the median would be 3.125%, which would have required just one more member at 3.125% to get there. Overall, we think this is a relatively dovish statement with the SEP.
Gregory Faranello, head of US rates strategy for AmeriVet Securities
The tone overall favors growth concerns right now as the Fed is showing rates still coming despite inflation remaining above the 2% target. The lack of more dissents shows more unity around the pathway to more neutral rates. Overall, a steadfast, methodical pathway down to neutral.
Bob Michele, JPMorgan Asset Management Head of Global Fixed Income
Only one dissent was surprising and it shows the Fed “locked arms” to reduce policy from what was surprisingly restrictive to them
Anna Wong, Bloomberg Economics
The widely anticipated 25-bp cut showed divisions on the committee. While the median participant expects two more 25-bp cuts this year, almost half of the FOMC expects just one or no more cuts this year. The policy statement and updated Summary of Economic Projections (SEP) display several other interesting contradictions. The policy statement added language to flag increasing downside employment risks, while acknowledging that inflation has moved up. In contrast, officials marked up their growth estimate this year, and lowered the unemployment rate estimates in the SEP forecast horizon.,,,
....MUCH MORE
For what it's worth, we pay attention to Ms. Wong's thinking on the Fed and suchlike.
Earlier today via ZH - "The Fed’s Roadmap Matters More Than the Cut"
"China’s Coal Power Can Win The AI Race"
The price of electricity is a big factor in determining who can go farthest, fastest.
Which sort of sucks.
From CoalZoom,
September 7, 2025 - In June, Rand Corporation researchers stated: “China wants to become the global leader in Artificial Intelligence by 2030”. Given events of the past 25 years, does anyone think this is an unreasonable goal? Decades ago, the world was caught flat footed by the rapidity with which China was able to utilize coal-based electricity to jump forward. In the 2000 World Energy Outlook, the IEA projected coal generating capacity would increase from the then current 212 GW to 499 GW in 2020. By 2020, however, China’s actual coal capacity was over 1,000 GW. Similarly, in 2000, the IEA projected China’s coal generation would increase from 990 TWh to 2,600 TWh in 2020. But, by 2020, generation from coal exceeded 4,800 TWh and was well on its way toward 6,000 TWh.
China plays the long game in energy. In successive Five-Year Plans, Beijing focused on strategic investments in renewable technologies as well as the critical minerals to support them. The PRC now dominates almost every part of the renewable supply chain whether it is solar PV modules, wind turbines, or batteries, usually enjoying a market share of more than 65%. The IEA Critical Minerals Report found that “China is the dominant refiner for 19 of the 20 minerals analyzed, holding an average market share of around 70%.” Robert Bryce also documented the issue, warning China has a chokehold on about three dozen key elements in the Periodic Table, “with an average market share of around 70%”. China uses its dominance in global critical minerals supply chains for strategic ends, and just last December banned exports to the US of gallium, germanium, and antimony.
Now, China has set its sights on dominating Artificial Intelligence. As Daniel Hook, CEO at Digital Science stated: “AI is no longer neutral – governments are using it as a strategic asset, akin to energy or military capability…and China is outstripping the rest of the world in research.”
A Tale of Two Countries
The United States also aspires to preeminence in Artificial Intelligence. President Trump has stated: “It is the policy of the United States to sustain and enhance America’s global AI dominance”. Secretary of Energy Chris Wright added that “American energy dominance “ is a prerequisite for achieving and maintaining AI dominance. Finally, NVIDIA CEO Jensen Huang recently made it clear: "Remember one big idea, every single data center in the future will be power limited”
In essence, the progress of AI and its associated data centers depends upon reliable and affordable electricity. The US is on the fast track to providing neither at scale. China, on the other hand, has developed a baseload generation system anchored by coal, the personification of reliability and affordability in the world of electricity.
Electrons follow the laws of quantum physics, not political rhetoric, and the simple fact of the matter is that the availability of reliable electricity is the ultimate restraint on AI. Rather than build a solid foundation for societal electrification, America has steadily eroded its most important source of baseload capacity—coal. Instead, the US is greatly expanding dependence on intermittent, unreliable and expensive wind and solar, whose production is limited by the immediate availability of the resource, thus greatly limiting their relevance to data center requirements of 24/7 electricity.
Consider these data: In 2015, baseload generation from coal, nuclear and natural gas provided about 80% of US electricity while wind and solar only produced near 6%, But with the continuing closure of hundreds of coal plants, the DOE projects the baseload fuels will only comprise 46% of power in 2035. Meanwhile, wind and solar generation is also forecasted to comprise 46%. In other words, almost half of US electricity will be dependent on intermittent, non-dispatchable, expensive sources of generation. The implications for data centers are enormous when the US is bracing for what the DOE called “unprecedented demand for electricity”. The US is treading a risky road indeed.
Meanwhile, China, America’s leading competitor in the AI race is building an extensive power generation system anchored by environmentally advanced coal power plants putting to rest the myth that there “is no such thing as clean coal”. As Clare Richardson of the National Bureau of Asian Research points out: “China is rapidly is deploying ultra-supercritical and supercritical coal technology, which can operate at higher temperatures and pressures to improve thermal efficiency”
China is preparing to be the global leader in energy for the rest of this Century. Coal currently provides over 60% of its electricity and China is assiduously expanding its coal fleet. Consider these data relating to coal’s role in their Energy Master plan:
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Federal Reserve September 2019: The Day Repo Went Crazy AS The FOMC Was Meeting
A six year retrospective on a very strange day.
The explanations proffered over the years do not satisfy.
As one example, the corporate tax payments due on the 16th of September were in the rear-view mirror on the 17th, the day of the spike, a fact pointed out by the authors of the Treasury's Office of Financial Research retrospective. There are other anomalies that we will look at over the coming days.
From the OFR Blog, April 25, 2023:
OFR Identifies Factors That May Have Contributed to the 2019 Spike in Repo Rates
Views and opinions expressed are those of the authors and do not necessarily represent official positions or policy of the OFR or Treasury.
A convergence of events caused a 2019 spike in repo rates, according to a new OFR Working Paper. On Sept. 17, 2019, intraday repo rates rose to more than 300 basis points above the upper end of the federal funds target range. This was 30 times larger than the same spread during the preceding week. In “Anatomy of the Repo Rate Spikes in September 2019,” the authors explain that the spike resulted in large part from a confluence of fundamental factors—large Treasury issuances, corporate tax deadlines, and an overall lower level of reserves—that, when taken individually, would not have been nearly as disruptive. In addition to these fundamental factors, the authors provide new evidence highlighting the role that limited transparency and market segmentation played in exacerbating the spike.
What Happened in Repo Markets?
Stresses in the U.S. repurchase (repo) markets, while uncommon, can occur unexpectedly. In mid-September 2019, repo rates spiked dramatically, rising to as high as 10% intraday. The disruption began on September 16—the day of Treasury settlement, which coincided with corporate tax deadlines. The combination of these two developments resulted in a large transfer of reserves from the financial market to the government, which created a mismatch in the demand for and the supply of repo that drove rates higher. However, even with this transfer in reserves, it is not immediately clear why repo rates rose as much as they did, especially since the peak of the stress occurred on September 17, after the Treasury settlement and corporate tax deadlines had already taken place.To aid in understanding the source of stress, Figure 1 below sheds light on the intraday pattern of rates among different segments of the market, using unique data from the OFR’s cleared repo collection.
Figure 1. Intraday Rates on Sept 16-18 in Tri-party and DVP
Note: Rates are volume-weighted averages.
Sources: OFR Cleared Repo Collection, Office of Financial Research
On September 16, rates did not increase until the afternoon and began increasing in the DVP-brokered market, most of which consists of trading between primary and nonprimary dealers. Volume was relatively low because 70%-80% of the day’s trades had already been negotiated by the time these spikes erupted, suggesting that only a limited number of firms were impacted by higher rates.
However, on September 17, the average rate in the tri-party segment (which is composed of banks and money market funds lending to dealers) rose to 6% and remained high for much of the traded volume that day. Following the Federal Reserve’s intervention at 9:30 a.m., rates declined substantially in the DVP-brokered market but remained elevated in other segments of the market throughout the day.
What Caused the Spike?
Rates in the repo market are highly dependent on the supply of Treasuries and reserves. By mid-September 2019, aggregate reserves had declined to a multiyear low of less than $1.4 trillion while net Treasury positions held by primary dealers had reached an all-time high. As a result, the reserve constraints on banks and bank-affiliated dealers may have played a contributing role in the repo spike....
....MORE
If interested see also the Federal Reserve Board's after-action report at FEDS Notes February 27, 2020:
What Happened in Money Markets in September 2019?
We've been picking at this scab for a few years and as noted above, will continue picking.
There is something odd about the timing and extent of the dislocation that is intriguing as can be.
As noted in 2021's Money, Money, Money: "A Self-Fulfilling Prophecy: Systemic Collapse and Pandemic Simulation":
....Follow the moneyIn pre-Covid times, the world economy was on the verge of another colossal meltdown. Here is a brief chronicle of how the pressure was building up:June 2019: In its Annual Economic Report, the Swiss-based Bank of International Settlements (BIS), the ‘Central Bank of all central banks’, sets the international alarm bells ringing. The document highlights “overheating […] in the leveraged loan market”, where “credit standards have been deteriorating” and “collateralized loan obligations (CLOs) have surged – reminiscent of the steep rise in collateralized debt obligations [CDOs] that amplified the subprime crisis [in 2008].” Simply stated, the belly of the financial industry is once again full of junk.
9 August 2019: The BIS issues a working paper calling for “unconventional monetary policy measures” to “insulate the real economy from further deterioration in financial conditions”. The paper indicates that, by offering “direct credit to the economy” during a crisis, central bank lending “can replace commercial banks in providing loans to firms.”
15 August 2019: Blackrock Inc., the world’s most powerful investment fund (managing around $7 trillion in stock and bond funds), issues a white paper titled Dealing with the next downturn. Essentially, the paper instructs the US Federal Reserve to inject liquidity directly into the financial system to prevent “a dramatic downturn.” Again, the message is unequivocal: “An unprecedented response is needed when monetary policy is exhausted and fiscal policy alone is not enough. That response will likely involve ‘going direct’”: “finding ways to get central bank money directly in the hands of public and private sector spenders” while avoiding “hyperinflation. Examples include the Weimar Republic in the 1920s as well as Argentina and Zimbabwe more recently.”
22-24 August 2019: G7 central bankers meet in Jackson Hole, Wyoming, to discuss BlackRock’s paper along with urgent measures to prevent the looming meltdown. In the prescient words of James Bullard, President of the St Louis Federal Reserve: “We just have to stop thinking that next year things are going to be normal.”
15-16 September 2019: The downturn is officially inaugurated by a sudden spike in the repo rates (from 2% to 10.5%). ‘Repo’ is shorthand for ‘repurchase agreement’, a contract where investment funds lend money against collateral assets (normally Treasury securities). At the time of the exchange, financial operators (banks) undertake to buy back the assets at a higher price, typically overnight. In brief, repos are short-term collateralized loans. They are the main source of funding for traders in most markets, especially the derivatives galaxy. A lack of liquidity in the repo market can have a devastating domino effect on all major financial sectors.
17 September 2019: The Fed begins the emergency monetary programme, pumping hundreds of billions of dollars per week into Wall Street, effectively executing BlackRock’s “going direct” plan. (Unsurprisingly, in March 2020 the Fed will hire BlackRock to manage the bailout package in response to the ‘COVID-19 crisis’).....
"The Fed’s Roadmap Matters More Than the Cut"
Via ZeroHedge, September 17:
The Fed’s Roadmap Matters More Than the Cut
- Stephen Miran’s board appointment favors rate cuts.
- Recent hiring data points to a rapidly weakening labor market.
- Bowman, Miran, and Waller are likely to support more aggressive easing.
The Federal Reserve’s interest rate outlook is about to grow more dovish…
Today brings a much-anticipated catalyst for investors across the globe. The Federal Reserve is set to release its latest monetary policy decision. Wall Street expects a 25 basis point rate cut, the first since December. It will bring the federal funds target to a range of 4.00% to 4.25%.
But let’s be clear: the cut itself isn’t the story. It’s already priced in. What matters most is the Fed’s outlook on monetary policy moving forward. As you can see from the table above, Wall Street expects the fed funds target range to drop by a total of 75 basis points to a range of 3.25% to 3.50% by December.
As a result, the most anticipated release tomorrow will be the Summary of Economic Projections (“SEP”) from policymakers. It will show where they believe the path of interest rates is headed over the next few years. The details will indicate the pace of policy easing by year-end and whether Wall Street’s current assumptions are correct.
Based on recent dynamics, it appears the Fed’s outlook should grow more dovish when forward guidance is released. I wouldn’t be surprised if the data endorses a total of three rate cuts by the end of 2025. That should underpin the outlook for economic growth and a steady rally in the S&P 500 Index.
But don’t take my word for it—let’s look at what the data’s telling us…
The Federal Open Market Committee (“FOMC”) meets eight times a year to set rates. It’s made up of seven board members and five rotating regional bank presidents—twelve voting members in total. But once a quarter, all nineteen officials (including non-voting district presidents) submit their forecasts for key economic indicators. These are aggregated and released in the SEP.
Here’s what they projected at the June meeting…
Now compare that to where we are: GDP is tracking close to 1.4%, unemployment sits at 4.3%, PCE inflation is 2.6%, and core PCE is 2.9%. The fed funds rate is currently 4.4%. So, most of the projections aren’t far off, but the rate path is likely to shift lower for two key reasons: weakening employment and a more dovish Fed board.
Let’s start with the labor market....
....MUCH MORE
Chips: Nvidia Challenger AI Inference Co., Groq, Raises $750 Million At Post-Money $6.9 Billion Valuation
We don't have much posted on Groq, only a half-dozen mentions in general articles on inference companies including SambaNova and Cerebras. One reason we do have it flagged is that the CIA's venture arm In-Q-Tel was an early investor. Another investor is Disruptive who seem to have an eye for pre-public companies:
...Palantir, Airbnb, Spotify, Shield AI, Hims, Databricks, Stripe, Slack...
That's from Groq's September 17 press release, "Groq Raises $750 Million as Inference Demand Surges".
We have quite a bit more on the company in the link-vault, including this piece from The Technologist substack, February 13: Deep Dive 4: Groq (Private)
Tuesday, September 16, 2025
"Culture is overtaking genetics in shaping human evolution, researchers argue"
Following up on some of the ideas in September 13's "Evolution And Physics: Nobody Expected The Spanish Inquisition".
From PhysOrg, September 15:
Researchers at the University of Maine are theorizing that human beings may be in the midst of a major evolutionary shift—driven not by genes, but by culture.
In a paper published in BioScience, Timothy M. Waring, an associate professor of economics and sustainability, and Zachary T. Wood, a researcher in ecology and environmental sciences, argue that culture is overtaking genetics as the main force shaping human evolution.
"Human evolution seems to be changing gears," said Waring. "When we learn useful skills, institutions or technologies from each other, we are inheriting adaptive cultural practices. On reviewing the evidence, we find that culture solves problems much more rapidly than genetic evolution. This suggests our species is in the middle of a great evolutionary transition."
Cultural practices—from farming methods to legal codes—spread and adapt far faster than genes can, allowing human groups to adapt to new environments and solve novel problems in ways biology alone could never match. According to the research team, this long-term evolutionary transition extends deep into the past, it is accelerating, and may define our species for millennia to come.
Culture now preempts genetic adaptation
"Cultural evolution eats genetic evolution for breakfast," said Wood, "it's not even close."Waring and Wood describe how in the modern environment cultural systems adapt so rapidly they routinely "preempt" genetic adaptation. For example, eyeglasses and surgery correct vision problems that genes once left to natural selection.
Medical technologies like cesarean sections or fertility treatments allow people to survive and reproduce in circumstances that once would have been fatal or sterile. These cultural solutions, researchers argue, reduce the role of genetic adaptation and increase our reliance on cultural systems such as hospitals, schools and governments.
"Ask yourself this: what matters more for your personal life outcomes, the genes you are born with, or the country where you live?" Waring said. "Today, your well-being is determined less and less by your personal biology and more and more by the cultural systems that surround you—your community, your nation, your technologies. And the importance of culture tends to grow over the long term because culture accumulates adaptive solutions more rapidly."....
....MUCH MORE
"Tyson Foods Is Dropping High-Fructose Corn Syrup"
A step in the right direction. The key to better nutrition will be determined by whether Tyson abstains from replacing the HFCS with table sugar, sucrose. Because HFCS is very close in composition to sucrose i.e. primarily made up of glucose and fructose, the real negative impact of HFCS was that, being cheaper than table sugar, processed food companies started adding it to everything they manufactured. Substituting sucrose for the HFCS just continues the negative effects at a higher cost.
As a side note, despite having the connotation of being a healthy sugar "it's from fruit!", fructose can really mess with your liver and other parts of your metabolic/endocrine systems. Corn syrup, before its glucose is enzymatically converted to 42 or 55% fructose is easier on your liver, though gobbling down too much will lead to diabetes just as surely as gobbling too much HFCS or table sugar or highly refined grains.
Anyhoo, enough chem/biochem, Here's the Wall Street Journal with the business story, September 15:
Meat company’s pledge follows Trump administration push to reduce usage of certain ingredients in food
Tyson Foods said it would stop using high-fructose corn syrup in branded products by the end of the year, the latest company to change recipes as the Trump administration takes aim at ingredients used in processed foods.
The Arkansas-based meatpacking giant that owns brands such as Jimmy Dean, Ball Park and Hillshire said it would also stop using the artificial sweetener sucralose, the preservative BHA/BHT and titanium dioxide, a food coloring.
Tyson said the decision was voluntary and follows its previous efforts to reduce sodium, sugars and other food additives. Chief Executive Donnie King said Tyson continuously reviews and assesses its product portfolio to meet the needs of consumers.
Tyson, which processes one-fifth of all chicken, beef and pork sold in the U.S., said its goal was to stop using high-fructose corn syrup and the other ingredients in its U.S. branded products by the end of the year. Tyson products that list the sweetener as an ingredient range from frozen honey battered breast tenders to frozen Jimmy Dean sausage, egg and cheese croissant breakfast sandwiches, according to labels on its products sold at supermarkets.
The Trump administration has been pushing food companies to change the way they manufacture products as part of an effort led by Health Secretary Robert F. Kennedy Jr. to address Americans’ chronic health problems.
Kennedy has called on companies to eliminate synthetic dyes in food, which he has linked to chronic conditions in children. Kennedy’s “Make America Healthy Again” proposal said the Trump administration would seek to restrict use of federal food assistance programs for junk food and establish a national definition of “ultraprocessed food.”
Big food companies, including Kraft Heinz and J.M. Smucker, have said they would remove artificial colors. In May, Tyson said it would remove petroleum-based synthetic dyes from its products.
President Trump in July encouraged Coca-Cola to use cane sugar in its sodas. “It’s just better!” Trump said in a Truth Social post. Coca-Cola later said it would release a version of its soda with cane sugar, but that the new version wouldn’t replace its traditional corn syrup offering.
Mills across the U.S. grind up corn to make roughly 7 million tons of high-fructose corn syrup a year. The sweetener is cheaper and more abundant for food and beverage makers than cane sugar....
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"Gucci, Balenciaga and Alexander McQueen private data ransomed by hackers"
For a while the stolen Rolodexes of casino hosts' high-roller clientele were en vogue in certain circles.
(Dad, what's a Rolodex?)
From the BBC, September 15:
Cyber criminals have stolen the private details of potentially millions of Balenciaga, Gucci and Alexander McQueen customers in an attack.
The stolen data includes names, email addresses, phone numbers, addresses and the total amount spent in the luxury stores around the world.
Kering, the parent company of the luxury brands, has confirmed the breach and says it disclosed the incident to the relevant data protection authorities.
It said no financial information, such as card details, were stolen.
The firm also says it has emailed customers affected but has not said how many, or made any public statements about the hack.
Legally, the company is not obligated to make any public statements about the breach as long as it has notified all individuals affected through other means.
The cyber criminal behind the attack calls themselves Shiny Hunters....
....MUCH MORE
"Lilly unveils 1st of 4 new US manufacturing sites with $5B Virginia API plant"
From Fierce Pharma, September 16:
Eli Lilly has revealed the location of the first of four large-scale manufacturing facilities that it plans to build in the U.S. The company has selected Goochland County, Virginia, as the site of a $5 billion plant that will produce active pharmaceutical ingredients.
The facility is part of a $27 billion investment plan that the Indianapolis drugmaker laid out nearly seven months ago during a high-profile press event in Washington, D.C., dubbed “Lilly in America.”
The company expects to break ground this year on each of the new plants, which Lilly calls “mega sites.”
Lilly's move to bolster its domestic capacity and strengthen its supply chain reflects a broader industry trend in which drugmakers have poured billions of investment dollars into the U.S. in response to the growing threat of tariffs on pharmaceutical products imported from foreign countries....
....MUCH MORE
Lilly is talking $27 billion for the four plants,
The article points out an effect of the administration's various tariff regimes that don't get highlighted that often:
...Other companies that have revealed massive investment plans in the U.S. in recent months include Roche, which has pledged to spend $50 billion, and Johnson & Johnson, which has unveiled a $55 billion plan that includes bolstering its medtech business. Meanwhile, Sanofi and Novartis have committed to spend at least $20 billion each in the U.S. by the end of the decade.Not highlighted that is except maybe by us.
As noted exiting Aug. 25's "Brace for a Second China Shock. Advanced Manufacturing Is at Risk":
One of the stated goals of the tariff regime is to encourage foreign companies to establish and/or increase their manufacturing footprint in the U.S. We have seen European companies, big pharma in particular respond to this aspect of the changing world of trade.
For their own reasons, some idiosyncratic, some policy driven, we have not seen Chinese companies react in the same way. The only recent large investment announcement that comes to mind is Chinese-owned (Haier) GE Appliances:
GE Appliances shifts more production to US as part of a $3 billion investment"AstraZeneca pledges $50bn US investment ahead of drugs tariffs"
Another One: "Amgen to expand Ohio biotech manufacturing plant"
The one that really stood out for us was "Swiss pharmaceuticals company Roche announces $50B investment in US over next 5 years" because it followed so closely on the warning from the EFPIA (also because of the 50 large, that's a lot of money, no matter who you are):
Another One: "Bristol Myers to invest $40 billion in the US over 5 years, CEO says"...April 13's "Pharma CEOs alert President von der Leyen to risk of exodus to the US" on The European Federation of Pharmaceutical Industries and Associations:
Here's who "These folks" are ...
"Sanofi to Invest at Least $20 Billion in US Through 2030"
Professor Nordhaus: "Are We Approaching an Economic Singularity? Information Technology and the Future of Economic Growth"
Contextualizing the post immediately below, Ruffer: "The anti-singularity machine" a repost from March 22, 2024.
Before he was awarded his own Nobel Prize I used to point out* that a bunch of his co-authors on various papers had picked up a tchotchke or two.
He's
another of the Cowles Foundation worker bees who, along with the
current overseer of the Foundation, Professor Shiller is among the dozen
or so Cowles economists who have received the Sveriges
Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, thus
keeping them close to the University of Chicago on the leader board.
From the American Economic Journal: Macroeconomics 2021 via Professor Nordhaus' personal website:
What are the prospects for long-run economic growth? One prominent line of economic thinking is the trend toward stagnation. Stagnationism has a long history in economics, beginning prominently with Malthus and occasionally surfacing in different guises.
Prominent themes here are the following: Will economic growth slow and perhaps even reverse under the weight of resource depletion?
Will overpopulation and diminishing returns lower living standards?
Will unchecked CO2 emissions lead to catastrophic changes in climate and human systems? Have we depleted the store of potential great inventions? Will the aging society lead to diminished innovativeness? (JEL D83, E25, O31, O32, O41, O47)There is a vast literature on the potential sources of stagnation. In the modern era, the “Limits to Growth” school was an early computerized modeling effort that produced scenarios for overshoot and decline in living standards (see Meadows et al. 1972; Meadows, Meadows, and Randers 1992).
In his economic history of the United States, Gordon (2016) argued that a decline in fundamental inventions might slow growth. Some foresee a long period of demand-side stagnation in the wake of the long recession that began in 2008 (see Summers 2014), although this looks less plausible for the United States in 2019 given the strong economic expansion. However, the present study looks at the opposite idea, a recently launched hypothesis that I label the Singularity.
The idea here is that rapid growth in information technology and artificial intelligence will cross some boundary, after which economic growth will rise rapidly as an ever-increasing pace of improvements cascade through the economy. The most prominent exponents are computer scientists (see the next section for a discussion and references), but a soft version of this theory has recently been advanced by some economists as well (Brynjolfsson and McAfee 2014, Varian 2016). Even some business research firms like Accenture have jumped on the bandwagon, predicting doubling of growth over the next two decades from artificial intelligence.
The purpose of this study is twofold. First, I lay out some of the history, current views, and analytical basis for rapidly rising economic growth. Next, I propose several diagnostic tests that might determine whether Singularity is occurring and apply these tests to recent economic behavior in the United States. The tentative conclusion is that the Singularity is not near, but we have developed tests that can give early warning signs of its occurrence.
I. Artificial Intelligence and the Singularity
For those with a background primarily in economics, the present section is likely to resemble economic science fiction. It will explain the history and a modern view about how the rapid improvements in computation and artificial intelligence (AI) have the potential to increase their productivity and breadth to the extent that human labor and intelligence will become superfluous. The standard discussion in computer science has no explicit economic analysis and leaves open important economic issues that will be addressed in later sections.It will be useful to summarize the argument before giving further background.
The productivity of computers and software has grown at phenomenal rates for more than a half-century, and rapid growth has continued up to the present. Developments in machine learning and artificial intelligence are taking on an increasing number of human tasks, moving from calculations to search to speech recognition, psychotherapy, and autonomous activities on the road and battlefield.
At the present growth of computational capabilities, some have argued, information technologies will have the skills and intelligence of the human brain itself. For discussions of the background and trends, see Moravec (1988), Kurzweil (2000, 2005), and Schmidt and Cohen (2013).
A. The Progress of Computing
The foundation of the accelerationist view is the continuing rapid growth in the productivity of computing. One measure of productivity is the cost of computing, shown in Figure 1. The constant-dollar costs of a standard computation have declined at an average annual rate of 53 person per year over the period 1940–2014.
There may have been a slowing in the speed of chip computations over the last decade, but the growth in parallel, cloud, and high-performance clusters, as well as improvements in software, appears to have offset the slowing of hardware speed for many applications.
Computer scientists project the trend shown in Figure 1 into the indefinite future. At some point, these projections move from computer science to computer science fiction. They involve improved conventional devices and eventually, quantum computing. If high-qubit quantum computing becomes feasible, this is likely to increase computation speeds by a factor of 100 million or more according to Google. This is about four decades of advances at the rates of recent years.
If large-scale quantum computing is available, then the constraints on artificial intelligence will largely be ones of software and engineering (see Moravec 1988, Kurzweil 2005).....
....MUCH MORE (34 page PDF)
*"Schumpeterian Profits and the Alchemist Fallacy"
I've referred to the Alchemist Fallacy quite a few time over the years, most recently in the context of mining the moon or asteroids or somesuch but haven't highlighted the paper where I first saw the term.If interested see also:
It's by Yale's Professor Nordhaus, one of the heavyweights.
(if you glance through his c.v. you'll find at least three Nobel Laureates he's co-authored with, among other stuff)...
Ruffer: "The anti-singularity machine"
From the absolute return mavens at Ruffer:
AI IS SET TO TRANSFORM OUR LIVES IN THE DECADES AHEAD.
But the market’s current optimism about the coming productivity revolution is being exaggerated by investment flows and feedback loops which are mechanically driving prices away from the fundamental reality. Such self-reinforcing market dynamics have in the past created extreme overshoots. And the bigger the overshoot, the larger the eventual correction.I WAS RECENTLY REMINDED OF A CLIENT’S POINTED REMARK TO JONATHAN RUFFER IN 2007: “All my clever friends are losing money, all my stupid friends are making money. And, if you think that is a compliment, it isn’t!”
So I hesitate before presenting a Review piece which may seem too clever by half. Yet now, of all times, we need to explain the basis of our continuing caution. What follows is just one component of a broader bearish thesis.A QUESTION OF INTELLIGENCE
Singularity is the artificial intelligence (AI) optimist’s dream. It is the concept of artificial superintelligence – one that surpasses the brightest human minds in practically every field, including scientific creativity, general wisdom and social skills.
Singularity promises untold benefits to the world, helping to solve some of our biggest problems. Ironically, the market’s optimistic reaction to the potential advent of superintelligence looks far from intelligent, with complex self-reinforcing patterns of investor behaviour mechanically distorting asset prices. This is driving what I refer to as anti-singularity: single stock dispersion rises as equity index correlations fall. Index correlation is the degree to which individual stocks in an index move together. High correlation indicates that stocks in the index tend to move in the same direction, ie there is a common systemic risk driver. Conversely, low correlation implies the absence of systemic risk from stock markets.
A brief technical aside: when thinking about correlation, we can look at implied correlation (what market pricing of derivatives implies about expected correlation) or realised correlation (what the actual correlation has been over a given period). The two should obviously be related as speculators will trade the relative price of implied correlation to expectations of its realised path.
In 2024, the implied correlation reached its lowest level since 1990, when the data set began, and it remains near that low today (Figure 1). This is market anti-singularity.
What is going on? Has something happened in the world which makes markets more immune to systemic forces? I doubt it. And it certainly doesn’t seem like a world which is short of systemic risks: wars, revolutions, nuclear threats, Trump II, political paralysis and power vacuums all over the place.
But investors always find a reasonable narrative to justify market extremes. In this case, the rising weight of mega-cap technology companies, which has a depressing influence on index correlation, is justified by the rise of AI, which will drive a productivity revolution. Thus the economy will enjoy much higher real growth without inflation, meaning interest rates can fall and earnings can outpace expectations. Initially, the very largest (mainly tech) companies are deemed the winners. At the centre is Nvidia, whose monopoly on chips gives it the immediate profit tsunami as the space race for compute capacity amongst all the mega-cap tech names accelerates.
Nvidia’s profit growth is real. And the mega-cap tech companies are also highly profitable. Their R&D spend gives Nvidia its profits. But they all get rewarded for this spending – so far, at least – with higher share prices. So this is not a profitless bubble like the dot.com blowout of 1999. Nor are their valuations as extreme as the Nifty Fifty’s in the late 1960s and early 1970s.So, say the bulls, why can’t the index move higher? And why can’t this happen with low correlations? After all, it is being driven by the largest companies, which will accrue most of the benefits.
In this version of the story, singularity optimism should logically drive anti-singularity in markets.
We think the more likely explanation is that implied correlation is simply a residual variable, the depressed output of different, more powerful market forces acting on the other variables from which correlation is derived.
I don’t want to ruin readers’ experience with a Greek laden maths definition of correlation. The key point is that correlation is a function of the volatility of both the index and the single stocks, and of the weights of those stocks in the index. In this equation, implied correlation uses implied volatilities, and realised correlation uses actual historical volatilities....
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And immediately following this post:
"Google reveals huge $6.8 billion investment in UK ahead of Trump visit" (GOOG)
From TechRadar, September 16:
Google to invest billions into the UK
- Google will invest £5 billion into the UK economy over two years
- A new Hertfordshire data center is key to the deal
- Google breaks the $3 trillion barrier
Google has set out plans to invest £5 billion ($6.8 billion) in the UK over the next two years ahead of a proposed UK-US tech trade deal, expected to be finalized this week during Trump’s visit to London.
The focus of Google’s investment will be on AI, infrastructure and scientific research, with the company set to open a £735 million ($1 billion) data center in Hertfordshire to support AI services across Google Cloud, Search, Maps and Workspace.
This forms just one of a growing list of investments being announced by US tech firms ahead of the impending deal, which is expected to tackle costly tariffs.
Google announces UK investment ahead of US-UK deal
Google shared details of its upcoming data center in a blog post, announcing that a projected 8,250 jobs will be supported by it....
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Capital Markets: "Cook and Miran to Attend the FOMC Meeting that Starts Today"
From Marc to Market:
Overview: The US dollar is trading with a softer bias against nearly all the G10 currencies. Yesterday's losses have been extended. The exception is the Norwegian krone, which is hovering around unchanged levels. The greenback is softer against most emerging market currencies. Despite Britain and France sending aircraft to help protect Polish airspace after more drone incursions, and Warsaw denying China's request to re-open the border with Belarus (a key conduit for Chinese goods into Europe), central European currencies, including the zloty are firmer. The Chinese yuan is at a new high for the year.
After new record highs by the S&P 500 and Nasdaq yesterday, most bourses in the Asia Pacific region rose. Taiwan and South Korea's markets led the rally of the large bourses with more than 1% gain. Only Hong Kong and China's CSI 300 failed to advance. European equities are lower. The Stoxx 600 is paring yesterday's gains and central European indices are lower, too. US index futures are firmer. European benchmark 10-year yields are a little more than one basis point higher, with the 10-year Gilt yield up two basis points after the employment report. The 10-year US Treasury yield is little changed near 4.04%. After a bullish outside day yesterday, gold reached a new high to near $3698. October WTI is trading quietly inside yesterday's range, which was inside last Friday's range. It is straddling the $63-area.
USD: The Dollar Index posted its lowest settlement since late July yesterday and is being pushed below 97.00 in late European morning turnover....
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Monday, September 15, 2025
IBD: "The S&P 500 Stock Best Positioned To Power AI Data Centers Is The IBD Stock Of The Day " (GEV)
From Investor's Business Daily, September 15:
GE Vernova (GEV) is Monday's IBD Stock Of The Day, with the S&P 500 component trading in a buy zone in stock market action after receiving a bullish upgrade as analysts see further 18% upside with demand for energy expected to be a long-term positive for the company.
Melius Research analyst Rob Wertheimer on Monday upgraded GE Vernova to a buy rating from the previous hold designation and now has a 740 price target on the shares. Wertheimer noted that GEV is up more than 400% since General Electric wrapped up its big, long-term breakup last year and that there remains a lot of room for "surprise to the upside on sell-side estimates moving toward 2027 and beyond."
On Friday, Jefferies raised its GE Vernova price target to 668 from 658 and kept a hold rating on the shares. Jefferies analysts noted that management has said it is "not going to surprise that differently on top line revenue." for 2028 and that potentially decelerating revenue growth out of 2028 "implies less support for a premium valuation."
Morgan Stanley analyst David Arcaro wrote Monday that coming out of the Laguna Conference, he "came away with increased confidence in the long-term outlook" for GE Vernova.
"Considering the outlook for continued data center growth, electrification across the economy, and industrial growth globally all supporting greater electric demand for a prolonged period, management sees the current cycle as strong and longer than almost any period in history," Arcaro wrote Monday.
Investors can also keep tabs on the Leaderboard, the IBD 50 list of top growth stocks and IBD SwingTrader along with the IBD Sector Leaders list.
GE Vernova Stock Performance
GE Vernova stock increased about 0.5% to 628.39 at the close for Monday's stock market after advancing 7.5% to 625.55 last week. The S&P 500 stock has a traditional buy point of 677.29, according to MarketSurge charts.Last week, GE Vernova pushed above the 50-day moving average, breaking a downward trendline in the base and flashing a possible buy signal. GEV is also on the IBD Leaderboard with analysis showing a buy point at 613 and a buy zone running to 643.65....
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Also at IBD, September 15:
Top S&P 500 Stock GE Vernova Receives Bullish Upgrade But Is Still Below Buy Point
GEV ended the regular session up $3.13 +(0.50%) at $628.68. In early after-hours trade it is down 88 cents.
"U.S. looks to boost strategic uranium reserve for nuclear power" (CCJ)
From Bloomberg via Canada's Financial Post, September 15:
The Trump administration’s top energy official said the United States should look to boost its strategic uranium reserve to buffer against Russian supplies and increase confidence in the long-term prospects of nuclear power generation.
U.S. Energy Secretary Chris Wright comments underscore the Trump administration’s plans to promote nuclear energy as the demand for power soars with the electrification of the economy. Russia supplies about a quarter of the enriched uranium needed by America’s fleet 94 nuclear reactors, which generate about a fifth of U.S. electricity. Turning the tap off too quickly from that source could endanger about five per cent of electricity in the absence of alternative suppliers or additional stockpiles.
“We’re moving to a place — and we’re not there yet — to no longer use Russian enriched uranium,” Wright said Monday in Vienna, where he’s attending the IAEA’s annual general conference.
“We hope to see rapid growth in uranium consumption in the US from both large reactors and small modular reactors,” Wright said. “The size of that right buffer would grow with time. We need a lot of domestic uranium and enrichment capacity.”
The first Trump administration proposed a uranium reserve in 2020 and sought US$150 million to purchase the metal directly from U.S. producers, though Congress only provided half of that. The concept also gained support from the administration of former U.S. President Joe Biden. The U.S. Energy Department in 2022 awarded contracts for the purchase of hundreds of thousands of pounds of uranium for the reserve from miners including Energy Fuels, Inc. and Uranium Energy Corp.
With an average of just 14 months of uranium on inventory, data compiled by the International Atomic Energy Agency shows inventories held by U.S. companies trail peers in Europe and Asia. The European Union has enough fuel on hand to power existing reactors for two-and-a-half years, while China maintains stockpiles equivalent to 12 years current generation, according to IAEA data published last quarter....
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Cameco ended the regular session up $8.21 (+10.51%) at $86.32.
Chips and Solar: "Think tank warns China’s polysilicon subsidies are frying Western fabs."
From The Register, September 12:
US boffins say Beijing's bargain wafers are burning rivals below cost
China is moving to dominate the global market for polysilicon, a key material used in chips, by flooding the industry with cheap, subsidised product to drive producers in other countries out of business.
This is according to a report by the Information Technology and Innovation Foundation (ITIF), a think tank based in Washington D.C. It warns that Beijing is providing "significant support" to its own polysilicon industry in an effort to establish local businesses as the dominant global suppliers.
This has already led to one US supplier filing for bankruptcy, and others will follow unless countermeasures are taken, the report claims.
Polysilicon is the main substrate material used to produce the wafers that are used in nearly every semiconductor fabrication plant worldwide.
According to ITIF, manufacturers of the material rely on the sale of solar-grade (less refined) polysilicon used in solar panels in order to maintain an economy of scale required to enable their production of semiconductor-grade (more refined) polysilicon.
However, Chinese manufacturers with financial support from Beijing have ramped up production of the less refined material, establishing them as the dominant global suppliers of solar-grade gear, threatening the financial viability of polysilicon makers in the US and elsewhere.
Similar warnings were made last year about China flooding the market with cheap chips. The country's output of commodity devices from mature silicon production processes was expected to more than double within the next five to seven years, it was reported, which would lead to semiconductor firms in other countries ceasing to make them.
ITIF says in its report that China's manufacturers have continued to expand, despite operating at a loss. They have grown through facilities in Africa, India, and the Middle East, while Beijing simultaneously blocks American polysilicon exports to China.
China is understood to have an 89 percent share of the global production of solar-grade polysilicon, and the top six manufacturers by volume, such as Tongwei and GCL Technology, are all based in the Middle Kingdom....
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See also the last fifteen years of rare earth magnet supply.
"What Would a New Treasury-Fed Accord Look Like?"
Following up on the Treasury-Fed Accord articles in August 26's Capital Markets: "Market Sees Challenge to Fed's Independence by Trump's Attempt to Fire Cook".
From Bloomberg, September 12:
The institutions are longtime frenemies, and Trump could complicate their relationship even further.
Donald Trump is hoping that he’ll be the first president to pick a fight with the Federal Reserve and win. The White House wants the central bank to bolster MAGA-nomics by bringing down borrowing costs, and Treasury Secretary Scott Bessent has urged Chair Jerome Powell to be more “imaginative,” even calling for a “revamp” of the Fed itself. One key candidate to replace Powell, former Fed official Kevin Warsh, has gone further, arguing for a new Treasury-Fed accord to replace the 1951 deal that shaped central bank independence.
Trump now has the biggest opening in decades to exert influence over the Fed, and he’s approaching it like a revolutionary. It’s at least possible that he will be able to secure a majority on the Fed’s seven-member board of governors, including nominating the next chair. He wants to fire Lisa Cook, a Biden appointee, but so far a lower court has blocked that effort, meaning she’ll probably vote at next week’s rate-setting meeting. But she’ll likely be joined by Stephen Miran, who is set to be on leave as chair of the White House’s Council of Economic Advisers to fill a short-term seat — an appointment that marks the closest ties between the White House and the Fed in nearly 90 years.
The Fed and the Treasury have worked closely together for most of their history. During the 2008 financial crisis and the pandemic, officials from both buildings spoke multiple times a day. But in each case, there was one topic that was completely off the table: monetary policy. The Fed has for decades been free to manage interest rates, keeping monetary policy separate from fiscal policy. Not many investors or economists think it’s a good idea to bring interest rates into the conversation.
“It’s not a violation of democratic norms for a president to express a view on monetary policy,” says Randy Quarles, who previously served as a vice chair for the Fed board and as a senior Treasury official in the George W. Bush administration. However, Presidents Harry Truman, Lyndon Johnson, Richard Nixon and George H.W. Bush all tried, and suffered from, attempts to bully the Fed. “History tells us that whenever a president gets into a fight with the Fed, he loses,” Quarles said.
That history is now poised to come up against Trump’s long track record of shattering norms at speed, and getting his way. The margin for error is almost nil: Failure would mean higher prices and a loss of central bank credibility that could take years to rebuild, with impacts for the global financial system. But so far Trump is not dissuaded.
“The Fed alleges that it needs to be independent,” Bessent wrote earlier this month in an essay in The International Economy. “But is it? Or is it captive to the ghosts of its past and of its own ego?”
Winning the War
The Fed’s origin story starts with a Treasury secretary. William Gibbs McAdoo, a lawyer who was also President Herbert Hoover’s son-in-law, helped create the Federal Reserve System in 1913 and was its chair for the first 230 days. The sitting Treasury chief sat on the Fed’s board until 1935, when Congress sought to strengthen the Fed’s independence from political influence.
Then World War II brought the two offices closer than they had ever been before, or since. The Roosevelt administration needed to keep the cost of American involvement in the conflict reasonable. In 1942, a few months after the US entered the war, the Fed made a formal commitment to maintain an interest-rate peg, giving the government a cheap way to finance deficit spending. The Fed, then chaired by Marriner Eccles, saw winning the war as the ultimate goal, even for monetary policy.By the time the Korean War began in 1950, President Harry Truman was hooked on cheap borrowing, and the White House wanted the Fed to keep the 2.5% interest rate peg to finance military operations. It didn’t matter that Eccles fretted to Congress that the central bank had become an “engine of inflation,” or that getting prices under control was imperative to protect the American public “against the deterioration of the dollar.” What mattered was that if the Fed abandoned its peg, according to Truman, it would be “exactly what Mr. Stalin wants.” When the Fed, reluctant to openly clash with the White House, privately suggested long-term plans to raise the cost of money, Treasury Secretary John Wesley Snyder rejected them. Monetary authority seemed ultimately to reside with the president.
By the beginning of 1951, the White House was continuing its pressure campaign on the Fed but the inflation Eccles had warned about was becoming apparent.
The scene was set for a standoff over interest rates to turn into an open war that would eventually set the modern-day standard for how the central bank and the Treasury Department worked together to steer the US economy.
The Agreement that Set the Fed Free
By the time a 100-mile-wide ice storm swept over Washington, DC, in January 1951, inflation was rising quickly and the relationship between the Fed and the Truman administration was broken. The fight over the Fed’s desire to raise interest rates had disintegrated into charges from the White House that the Fed was failing in its moral and patriotic duties.For his part, Treasury Secretary Snyder did not believe that higher interest rates would curb inflation, saying that time and time again, such tightening failed to do the job. Based on experiences after the Civil War and World War I, the economic zeitgeist of the era indicated that deflation would naturally follow the end of World War II, and that the government could control inflation by running budget surpluses....
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