Monday, September 16, 2024

"Nvidia’s Stock Rally Pauses. A New Generation of Data Centers Is Arriving." (NVDA)

From Barron's September 16:

Nvidia has gained from renewed confidence in demand for its chips, partly fueled by cloud-computing and software company Oracle. 

Nvidia was slipping early on Monday as the chip maker looks set to give back some gains from the previous week’s rally.  

Nvidia shares were down 0.6% at $118.45 in premarket trading on Monday. The stock closed broadly flat on Friday but has risen 12% over the past five trading sessions. 

Nvidia has gained from renewed confidence in demand for its chips, partly fueled by cloud-computing and software company Oracle which has talked of companies spending $100 billion each on developing their artificial-intelligence models.

Oracle has outlined plans to build an AI supercomputer that will be powered by 131,072 of Nvidia’s next-generation Blackwell chips

“Nvidia is at the epicenter of all things related and is the pioneer for artificial intelligence infrastructure,” wrote Ken Mahoney, CEO of Mahoney Asset Management, in an emailed comment. “They have been and will continue to be the beneficiary of this movement.”

However, there are signs that investors in big data centers are diversifying what type of chips they intend to use....

....MORE

More and more talk about the progression from training to inference though. 

NVDA $115.63 down $3.47 (-2.91%), last.

Earlier on Oracle: "Elon Musk and Larry Ellison begged Nvidia CEO Jensen Huang for AI GPUs at dinner"

"US Commerce Secretary Wants Apple and Nvidia to Use Intel Foundry for AI Chips" (NVDA; AAPL; INTC)

One of these is not like the others.

Last week we saw - here via Tom's Hardware:

Intel cleared to get $3.5 billion to make advanced chips for Pentagon — Secure Enclave program ushers leading-edge CPUs to the military

And September 13 at ExtremeTech:

US Commerce Secretary Wants Apple and Nvidia to Use Intel Foundry for AI Chips

It looks like we have one of those "Whole of Government" operations going on here.

Meanwhile, back to Tom's Hardware:

Shut up and take my money.

 

"Smokeless War: Europe is Getting 'Boursicoted' by Beijing"

From The National Interest, August 31:

Faced with this breadth and depth of Chinese influence operations, what should Europe do?

In 1964, Shi Pei Pu, a Beijing opera singer and spy, started a perplexing liaison with French diplomat Bernard Boursicot. Their trysts always took place in the dark, which Boursicot attributed to Chinese modesty. In fact, Shi was a man posing as a woman. He even presented a child, whom he claimed was their offspring. This ruse was designed to coax Boursicot to continue to pass French embassy documents to officials of the Chinese Communist Party (CCP) for twenty years. The record does not indicate if this was the first time a Western official should have been less naive about the People’s Republic of China (PRC), but the tradition continues....

....MUCH MORE

Well there's a story I hadn't heard before.

Capital Markets: "Greenback Continues to Trade Heavily amid Heightened Speculation of a 50 bp Cut Wednesday"

From Marc Chandler at Bannockburn Global Forex:

Overview: The markets are continuing to be impacted by the possibility that Fed officials planted a press report to put 50 bp cut back on the table after the market had moved away from it after the recent jobs data and CPI. In the Fed funds futures, there is around an 80% of a half-point move on Wednesday discounted and about an 80% chance of a second 50 bp cut this year. This has taken a toll on the greenback and cut short the technical correction to last month's slide. The US dollar is off against most of the world's currencies and has been sold below JPY140 for the first time since July 2023, though Japan, China, and South Korean markets were closed for local holidays. It managed to resurface above JPY140 in late European morning activity. The Canadian dollar continues to lag in the move against the greenback amid speculation that the Bank of Canada may also move by 50 bp in one of its last two meetings of the year. Emerging market currencies are mostly higher, led by central European currencies.

Asia Pacific equity markets were mostly higher, and Europe's Stoxx 600 is posting a small gain, which if sustained would be the fourth consecutive advance. US index futures are narrowly mixed. European 10-year yields are mostly slightly higher today, while the 10-year Treasury yield is practically flat at 3.65%. The two-year yield is off nearly two basis points to3.56%. Gold likes the weaker dollar and lower rates and has set a record high near $2590. After settling near session lows before the weekend (~$67.75), November WTI is trading firmer though within Friday's range. It is near $68.20. It rose 1.15% last week to snap a four-week, 10.5% drop....

....MUCH MORE

He goes on to note that larges swaths of Asia are closed: 

....Asia Pacific
Japan's markets were on holiday today, for Respect-for-the-Elderly.
They will be closed next Monday for the autumn equinox. Chinese markets are closed today and will remain shut tomorrow for the mid-autumn festival. Remember Chinese markets are closed October 1-7, celebrating the national foundation, known as "Golden Week." South Korean markets also closed, and for the next two day for the Harvest Moon holiday....

And in the Americas section:

....many suspect that the Chair itself planted a press story last week to put a 50 bp cut back on the table. The derivatives market now has about an 80% chance of a 50 bp cut discounted. And more. The derivatives market is discounting 120 bp of easing over the three remaining meetings of the year. That is tantamount to at least one 50 bp cut and about an 80% chance of a second half-point move....

When we say "MUCH MORE" we mean "MUCH MORE."

Sunday, September 15, 2024

Capturing (And Capitalizing On) Waterborne Methane

From AgFunderNews, June 25:

Bluemethane unveils novel tech to capture methane from water

When it comes to methane emissions, most people think of oil, coal, gas and livestock, says Louise Parlons Bentata, co-founder and CEO at UK-based startup Bluemethane. What they often don’t know about, she says, is water.

“Methane emissions from water are an environmental catastrophe but also a waste of valuable resources that can be turned into clean energy. Human sources of methane emissions from water such as rice cultivation, waste streams and reservoirs emit more than three billion tons of CO2e per year from methane emissions, but awareness is really low.”

Founded in 2021 by Parlons Bentata and engineer Nestor Rueda-Vallejo, Bluemethane is part of the fifth cohort of the AgFunder GROW Impact Accelerator [Disclosure: AgFunder is AgFunderNews’ parent company] and is on a mission to remove methane from a variety of water sources, starting with wastewater treatment in the UK, where utility companies have committed to achieve net-zero status by 2030.

AgFunderNews (AFN) caught up with Parlons Bentata (LPB) to discuss how methane is released from water sources, how to monetize methane reduction, and the challenges around raising capital to address a market opportunity that is not yet well understood.

AFN: Give us the origins story of Bluemethane…

LPB: I began my career at L’Oreal [as a brand manager], did an MBA, and then worked at Johnson & Johnson [as a global marketing manager]. I then ran my own strategy company for about 10 years until I started working with an engineering company [a client] that was making very highly valuable things that were ending up in landfill.

I said, ‘Can we do a project [to tackle this problem]?’ And he said ‘No, you’re not qualified.’ I said, ‘Well what do you need to be qualified?’ He said ‘I don’t know, but I can tell you that you’re not qualified to do it.’ So he brought in this lady to take on the project, and I said to her, ‘What makes you qualified?’ And she said, ‘I’ve just got back from Cambridge [University], where I’ve done a postgrad [course] in sustainable business leadership. So I said, ‘All right, I’ll sign up for that then.’

So just as COVID began [in 2020], I signed up for this nine-month course in the evenings while still managing my work [the day job] and three children, and then in 2021, I signed up for a climate technology fellowship program called On Deck, not knowing what I really wanted, but knowing I wanted to do something new.

On the first day [in March 2021], I met my cofounder Nestor, an engineer who was looking at how hydropower reservoirs emitted billion tons of greenhouse gases. By May/June, we gave up the things that paid our mortgages, having never met in person. We met for the first time in September 2021 and joined [the] Carbon13 [climate accelerator].

AFN: Why is there methane in water and when can it cause a problem?  

LPB: Methane is produced through the decomposition of organic matter [by microbes] in water in low oxygen conditions. So think of a sewer, which is an almost entirely anoxic [oxygen-free] environment. Rice cultivation also releases methane because farmers often keep rice paddies flooded, which creates anaerobic conditions that allow microbes to feed on organic matter and produce methane.

There are quite a lot of academic papers on this, but nothing compared to all the stuff written on capturing CO2; but it’s a really big problem. At least 3 billion tons of carbon dioxide equivalent are coming from just the anthropogenic water bodies like reservoirs or rice paddies, and sewage and things like that.

AFN: Why doesn’t the ocean release a bunch of methane gas?

LPB: It’s actually far less of an issue than other water sources because the water is moving [methane released in the deep ocean can be diluted and dispersed by ocean currents over vast areas, making it less likely to reach saturation and escape into the atmosphere], and more oxygen is being circulated [inhibiting the activity of anaerobic microbes that produce methane].

AFN: What determines whether the methane stays in the water or is released into the atmosphere?

LPB: It is released in three different ways. The first is bubbling. You’ll see this in shallow water where methane forms bubbles that rise and burst at the surface as the pressure from overlying water is not sufficient to keep the methane dissolved. In a reservoir with a lot of methane, for example, you’ll see bubbles near the edge, but not in the deep parts.

Then second there’s diffusion, where the molecules transfer at the surface to become gas when the concentration of methane in the water is higher than in the air.

And then there’s degassing where there’s a sudden change of pressure that causes dissolved gases to be released rapidly, so imagine a large volume of water passing through a dam wall. Suddenly there’s no weight in the water above it, it goes through and you see loads of bubbles....

....MUCH MORE

"Shanghai slammed by Typhoon Bebinca, strongest storm to hit in seven decades"

Let's hope they taped the window's before heading out for the holiday.*

From CNN via MSN, Sept. 15:

Shanghai was brought to a standstill on Monday morning by what authorities say was the strongest typhoon to directly hit the Chinese financial hub in more than seven decades, with flights, trains and highways suspended during a national holiday.

Typhoon Bebinca made landfall in an industrial suburb southeast of the metropolis of 25 million people around 7:30 a.m. local time. The Joint Typhoon Warning Center (JTWC) said it packed top wind speeds of 130 kilometers per hour (80 mph), the equivalent of a Category 1 Atlantic hurricane....

....MORE

As noted in this 2020 post (HK is further south, closer to the equator, tropical, a degree or so south of the Tropic of Cancer):

Shipping: "Typhoon could hit Port of Hong Kong this weekend"

Buy tape. The first rule of preparing for typhoons in Hong Kong is tape the glass.
We are talking a lot of tape.*
And because the headline story is from FreightWaves we're talking shipping:

Hong Kong may have to brace for a typhoon slamming its large container port this weekend.
A cluster of thunderstorms over the Philippines has the potential to become a typhoon during the next couple of days. This would be the second named storm of the 2020 Pacific typhoon season. The first was Typhoon Vongfong, known as Typhoon Ambo in the Philippines, which hit that island nation in May. The season runs throughout the year, but most Pacific typhoons develop from May through October.

This storm, which would be named Typhoon Nuri, will likely track over the northern Philippines on Friday, June 12, moving into southeastern China over the weekend. The projected track takes the storm close to Hong Kong on Sunday, June 14.

The potential typhoon could delay various services, from container cargo to cruises and public transportation.

Hong Kong is one of the busiest container ports in the world....
....MUCH MORE
*Hong Kong has more skyscrapers than any other city in the world. 
That's a lot of glass:


http://www.globalphotos.org/hongkong/20051018/IMG_2463.jpg 

And in 2018's "Supertyphoon Mangkhut Downgraded To Severe Typhoon": 

....And here's the South China Morning Post's front page.
They're reporting that Hong Kong Has run out of tape for the windows....

And Andy Yeung via DesignBoom:

https://www.designboom.com/wp-content/uploads/2016/03/andy-yeung-drone-photography-hong-kong-designboom-04.jpg

"Forget Artificial Intelligence, Here's Artificial Empathy"

A repost from October 2013:

Thanks to whoever sent this in, if you wish a hat tip drop us a line and we'll do the right thing.
From Kernal Magazine:

AI is over: this is artificial empathy

Worried about the NSA spying on you? That’s nothing compared to the intricate analysis of your voice patterns that happens every time you call the gas company.
Are you the kind of person who prefers to be chatty on customer service calls, or do you like to get right to the point? Do you prefer to be lead through an explanation every step of the way, or do you prefer the person on the other end to just shut up and “do what they need to do”? Do you prefer person-centered explanations, or technical explanations? Are you outgoing, or are you shy?

Believe it or not, there is a computer system out there that can figure out the details of your personality and interaction style after listening to mere seconds of your phone calls. In fact, this may have already happened the last time you called a customer service line. There is no way you would ever know.

Mattersight is an extremely sophisticated data analysis system that listens to the way you respond on the telephone. It listens to you in the background, and breaks down hundreds of micro-features of your voice: volume, tone, pauses, speed of response, and so on. It uses extremely sophisticated mathematical algorithms to interpret these features, compare them to data in their databases, and come up with a personality profile for you.

All of this happens, by the way, during the first few seconds that you are on the phone. It could even be happening while you are working your way through a voice-activated menu system.

Then, when you are finally connected to a sales representative or customer service professional, Mattersight takes its analysis of your personality, compares it to the personality profiles of the call center employees that it has on file, and automatically connects you with the service agent that you are most compatible with....MORE
Mattersight trades NASDAQ, symbol MATR, $4.12 and a $72 million cap.
Here are the second quarter financials, they are going to have to raise some money or get profitable, fast.
Not our kind of deal.

note: the "MORE" link has rotted, here's the Internet Archive - http://web.archive.org/web/20131029194256/http://www.kernelmag.com/features/report/5910/ai-is-so-over-this-is-artificial-empathy/# 

note: MATR was purchased for $2.70 per share in 2018. 

As the retail guys say: "But Mr. Bigg, if you annualize that..."

"World’s largest flywheel energy storage system with 30 MW output connected to grid"

You really, really want the machining on things like this to be as close to perfect as possible, lest it wobble itself right out the door.

From Interesting Engineering, September 15:

With a power output of 30 megawatts, China’s Dinglun flywheel energy storage facility is now the biggest power station of its kind.

The US has some impressive flywheel energy storage plants. The largest of these is the 20 MW Beacon Power flywheel station located in Stephentown, New York. Until recently, it was the world’s largest flywheel energy storage system (FESS), but not anymore.

China has developed a massive 30-megawatt (MW) FESS in Shanxi province called the Dinglun flywheel energy storage power station. 

This station is now connected to the grid, making it the largest operational flywheel energy storage facility ever built....

....MUCH MORE, quite a project.

"Iran plans to deport 2 million Afghan refugees"

From Deutsche-Welle, September 14:

After years of economic crisis, Iranians' frustration is increasingly directed at Afghan migrants. Under pressure to act, the government has now announced plans to deport 2 million Afghan refugees in the coming months.

Iranian police chief Ahmad-Reza Radan said in the next six months, some 2 million undocumented foreigners would be deported from Iran.

Speaking to the Iranian news agency Young Journalists Club in an interview on Tuesday, Radan also said security forces and the Interior Ministry were working out measures that would deport "a considerable number of illegal foreigners" over the long term.

When Iranian officials speak of "illegal foreigners," they usually mean migrants from Afghanistan. Iran and Afghanistan share a 900-kilometer (560-mile) long border, parts of which run through inaccessible, high mountain ranges. For over 40 years, Afghans have fled to Iran to escape civil war, poverty, and, now, the Taliban.

"Afghans are cultivated people, but our country cannot receive so many migrants," Iranian Interior Minister Eskandar Momeni said in an interview with Iran's state news agency on Monday.

He also highlighted the difficulties people in Afghanistan face and pointed out cultural similarities with Iranians.

"We plan to handle these matters in an orderly fashion and without much fuss," he said. "Our priority lies with irregular migrants."

In May, the Interior Ministry announced that some 1.3 million irregular migrants had been deported to Afghanistan in the past 12 months.

UNHCR: Over 4 million Afghans in Iran
The United Nations refugee agency UNHCR estimates that nearly 4.5 million Afghan nationals currently live in Iran. According to Iranian news agencies, however, the real number could be as high as 6 million or 8 million.

Many do not have a legal permit, avoiding registration out of fear of being deported. Many also intend to pass through Iran while trying  to reach Europe....

....MUCH MORE

Mayfair, Monte Carlo highly recommended.

Of course there are exceptions, but in general the following are true for me:

5 stars - I thoroughly enjoyed it and will go out of my way to eat here regularly.
4 stars - I would go out of my way to eat here again.
3 stars - I would go again if I'm in the neighborhood, but I won't go out of my way for it.
2 stars - I would only eat here again if someone else really wanted to and was paying for it.
1 star - I would not eat here again, even if it's free.

Meanwhile, In The Arctic: "Svalbard-research becomes more important for China, professor says"

From The Barents Observer, September 10:

China’s Polar Research Institute agrees to prepare joint Arctic scientific projects with Russian partners. This became clear during a recent visit to Barentsburg on Svalbard. 

The Chinese delegation came to the Russian settlement on Svalbard in late August. Here, Arktikugol director Ildar Neverov presented Russia’s plans to establish a scientific centre in Pyramiden. Moscow hopes to attract researchers from BRICS+ countries to team up for science and education at a new centre that yet has to be built.

Professor Marc Lanteigne with UiT - Arctic University of Norway in Tromsø is expert on China’s Arctic interests. He believes Svalbard will become even more important for Bejing under the current geopolitical global power tensions.

“With Chinese research interests being curtailed elsewhere, including in Canada and Greenland, Svalbard is growing in importance for Chinese polar researchers,” Lanteigne says to the Barents Observer.

The professor is one few academics based in northern Norway that speaks mandarin. In Ny-Ã…lesund on Svalbard, where China for 20 years has operated its Arctic Yellow River Station, Marc Lanteigne easily finds topics of shared interest to discuss.

The station is crewed with scientists from the Shanghai-based Polar Research Institute of China (PRIC).

Lanteigne says China has a growing concern that Norway is seeking to expand its oversight of research activities on Svalbard.

“Beijing is especially critical of Norwegian protocols which call for research on the archipelago to be restricted to natural science,” Lanteigne explains....

....MUCH MORE, the writers go deep on what could very well turn out to be a geopolitical flashpoint. 

We've mentioned China's proclivity for establishing bases on international maritime chokepoints: the billion dollar bridge over the Panama Canal, the giant battery factories in Morocco - the eastern approaches to the Strait of Gibralter.

Also February 2024's "Red Sea Rivalries": 

The most amazing thing that has been pointed out over the last couple months is that China's base on Djibouti's Gulf of Aden coast, at the approaches to the Bab al-Mandab chokepoint into the Red Sea, gives them the perfect location to monitor Houthi action and American reaction:

China Officially Sets Up Its First Overseas Base in Djibouti

China Officially Sets Up Its First Overseas Base in Djibouti, The Diplomat



Also the Suez Canal itself: ""China & Egypt Strengthen Belt And Road Collaborations Including The Suez Canal International Logistics Zone"
I'm beginning to see a pattern here.*

And April 2024 Why the U.S. and China Suddenly Care About a Port in Southern Chile": 

 

And all of a sudden (after years of development) China is hanging out at the entrance to some very strategic sea lanes. In fact, the only major chokepoint not seeing a Chinese development that comes to mind is the Strait of Malacca between Singapore/Malay Peninsula and Indonesia's Sumatra.

The Bering Strait between the Russian far east and Alaska and South Africa are on a gentle simmer and back to Svalbard, one look at the map shows the attraction. Also from the Barents Observer, this time in 2021:

Geopolitics: "Moscow aims to enhance presence in Svalbard as part of hybrid-strategy, expert warns"

....Military speaking, Svalbard is of great strategical importance, located between the Barents-, Greenland-, and Norwegian Seas. The one controlling Svalbard is also likely to control the important gateway from the shallow Barents Sea to the deeper North Atlantic.

For Russia’s Northern Fleet, the so-called Bear Island Gap between mainland Norway and the archipelago’s southernmost island is key to conducting sea denial operations in and over the maritime areas further south, potentially threatening NATO’s transatlantic sea lines of communication.


Russian Bastion Defence in relation to Norway and the Bear and GIUK Gaps. 
Source: Mikkola / RAND Europe report 
 
Regarding China in the Great White North:
"China’s Emerging Strategies in the Arctic"
"China’s Polar Strategy: An Emerging Gray Zone?"
"Pentagon warns of risk of Chinese submarines in the Arctic"
"Don't Fear China's Arctic Takeover"
"How To Avoid A Naval Cold War In The High North"
Natural Gas: "Chinese oilmen make big discovery in Russian Arctic waters"
"China opens bids for first nuclear-powered icebreaker"
China seeks a more active role in the Arctic
China defines itself as a near-Arctic state and says it will actively participate with wisdom and strength to future protection and development. Roger that, wisdom and strength, over.
Flashback, June 2018:
...On the other hand, if you read Xinhua's translation of January's "Full text: China's Arctic Policy" you'll note they call themselves a ‘Near-Arctic state’.
This is to counter people like me using the 'non-polar' or 'non-Arctic' phrasing.
Additionally China is couching their interest in terms of research:
States from outside the Arctic region do not have territorial sovereignty in the Arctic, but they do have rights in respect of scientific research, navigation, overflight, fishing, laying of submarine cables and pipelines in the high seas and other relevant sea areas in the Arctic Ocean, and rights to resource exploration and exploitation in the Area, pursuant to treaties such as UNCLOS and general international law. In addition, Contracting Parties to the Spitsbergen Treaty enjoy the liberty of access and entry to certain areas of the Arctic, the right under conditions of equality and, in accordance with law, to the exercise and practice of scientific research, production and commercial activities such as hunting, fishing, and mining in these areas....

Saturday, September 14, 2024

"Germans are bad at investing"

From Klement on Investing, July 17:

I mean really bad. So bad indeed that one has to wonder what is going on there. And I know what that says about me as a German working in the investment industry. But let me explain…

There is a bit of a conundrum when it comes to Germans and their living standards. On the one hand, Germans are famously productive and inventive, creating a lot of income from their economic activities. Also, Germans are famously frugal with a rather high savings rate (particularly when compared to Americans or Brits).

But when one looks at living standards, the Germans typically lag the Americans and are not that much ahead of the Brits, French or other nations. In theory, if you have higher income and higher savings you can invest these savings and let the money work for you so that you end up with even more savings and higher income and thus higher living standards. Unless you do not make your money work for you…

I know I am mixing things here that aren’t the same but stay with me for a minute and look at the chart below which is taken from an analysis by the Kiel Institute for the World Economy. It shows the cumulative return on German domestic and foreign investments as well as the foreign investments of the UK and the US.

Cumulative return of German, UK and US foreign investments


Source: Hünnekes et al. (2023)

The chart above shows that German foreign investments are not only worse than their domestic investments but miles behind the UK and the US. Now, be aware that this is the cumulative return of all kinds of foreign investments, which includes foreign direct investments, foreign portfolio investments in stocks and bonds, central bank reserves invested abroad and other investments such as trade credit.

But, and this is where things become relevant to most readers, one can show the same by just looking at equity funds located in different countries that invest abroad. Here is the average performance of international equity funds from 2000 to 2021 by location of the fund. German fund managers have among the lowest average returns and much lower average returns than their peers in the UK or the US....

....MUCH MORE

A possibly related post from 2009:

German pensioners ‘kidnap and torture their investment adviser’

A group of well-to-do pensioners who lost their savings in the credit crunch staged an arthritic revenge attack and held their terrified financial adviser to ransom, prosecutors said yesterday.

The alleged kidnapping is the latest example of what is being dubbed “silver crime” — the violent backlash of pensioners who feel cheated by the world.

“As I was letting myself into my front door I was assaulted from behind and hit hard,” the financial adviser James Amburn, a 56-year-old German-American, said. “Then they bound me with masking tape until I looked like a mummy. I thought I was a dead man.”

He was freed by 40 heavily armed policemen from the counter-terrorist unit last Saturday. The frightened consultant was in his underwear, his body lacerated by wounds allegedly inflicted by angry pensioners.

It appears that two couples had entrusted Mr Amburn’s investment company with €2.4 million (£2 million), which he ploughed into Florida’s boom-and-bust property market. The properties became forfeit during the sub-prime mortgage crisis but the couples wanted their money back.

After being bundled into the boot of an Audi in the west German town of Speyer, Mr Amburn was driven southwards to Chieming, close to the Austrian border, where one of the couples Roland K, and his wife, Sieglinde, 79, had a holiday home.

The financial adviser claims he was held there in a cellar for four days almost naked, fed soup twice a day and beaten. Another couple, Gerhard F, 63, and his wife, Iris, 66, both retired doctors, allegedly helped to torture the prisoner....

Maybe it's not Germans but rather their advisers.

"“Downton Abbey” but with NDAs: how to be a butler to the super-rich"

Do this for five years and you'll learn half of what you need to know to run a family office.

From The Economist's 1843 Magazine, September 13:

Inside the elite college that’s reinventing Jeeves for the 21st century

In the frescoed ballroom of the International Butler Academy (TIBA) in the Netherlands, a gaggle of students shuffled into line. “You may have walked in a certain way for 25 years, but this is not how you do it as a butler,” said their etiquette instructor, addressed by everyone as Mr Munro. He ordered them to slot their arms behind wooden crosses, which they held against their spines – “torture devices” to correct posture. “Now relax!”

The suited students – five men and two women, aged from mid-20s to late-50s – primly waddled across the marble floor. Their crosses were removed and each was handed a book and a silver tray loaded with wine glasses. “This is harder for those that are follically challenged,” said Munro (who is bald). “But if the book is in the right position, I can do almost anything.” He performed a pirouette with a copy of Forum Kritische Psychologie, a German psychology journal, perched on his head. As his students tried to emulate him, the sounds of books slapping the floor and wine glasses smashing echoed around the hall.

As soon as they found their balance, Munro started hurling balls the size of grapefruit at them. The students swerved, with varying degrees of success. The aim of the exercise was not only to protect the glassware but maintain a calm demeanour under bombardment; although butlers are never centre stage, they are, ultimately, performers. “We are working for real people, but it’s still a show,” Munro, a former actor, told me. This was something that his students recognised as well. As one academy graduate put it to me later, “We’re only actors. It’s a role we play.”

Munro’s students were over halfway into a ten-week course at the academy, considered by many in the business to be the most intensive butler-training programme in the world. Students live in a 135-room former monastery and role-play at buttling full time. At a cost of €15,500 ($16,600), the diploma is an expression of commitment, both to a career as a butler and the archaic philosophy of service embodied by the school. Several students told me that the most important skill they gained was an instinct for “pre-emptive service”: knowing in advance what their principal, or employer, may want or require.

The precise theatrics of the job bolster the notion that a butler is 
someone who can handle anything with poise and elegance

That butlers still exist at all is somewhat surprising. The job, which is most associated with the Victorian and Edwardian eras, involves a skillset that seems at odds with the needs and tastes of modern rich households. A traditional English butler would prepare the dining room and serve at least three meals a day; he was responsible for the household china, table linen, wine cellar and managing the junior staff. He may also have acted as his principal’s valet, or personal dresser. (Befitting his status, the butler was, unlike other staff, permitted to use the front door.)

TIBA, which trains 30 to 50 new butlers a year, is a star institution among a small constellation of schools and recruiters that prepares people for this particular form of service. The booming economies of Saudi Arabia and the United Arab Emirates are a source of great demand, according to staffing agencies; there, the mores of the European aristocracy are highly valued (British and German butlers can command annual salaries of $100,000-200,000). China, too, is home to a growing population of super-rich individuals, who seek high-end staff to match their luxury accommodations. Traditional butlers, schooled in the etiquette of the upper classes, can also help those newly arrived in Europe or America ingratiate themselves to an unfamiliar culture by acting as discreet guardians of good taste. 

The precise theatrics of the job – which include wearing white gloves, being able to fold napkins in an array of flamboyant shapes and penning eloquent, last-minute birthday cards on behalf of their principal – bolster the notion that a butler is someone who can handle anything with poise and elegance.

In truth, many clients seem more attracted to this idealised vision of the butler than the skills customarily associated with it. Rich households, particularly in Western countries, now tend to have fewer staff, in part because they prefer to retain a close-knit circle of employees. As a result, the butler’s job description has broadened. Some clients have come to treat their butlers as a nanny-cum-chef-cum-chauffeur, rather than as a sommelier with a knack for buffing silver.

The enduring appeal of having a butler is partly due to the cultural legacy of Jeeves (who is in fact a valet) from P.G. Wodehouse’s novels. Jeeves’s commitment to his principal, Bertie Wooster – which manifests in everything from warding off Wooster’s hangovers with an egg-based concoction to drugging his enemies – is central to his allure. In “Very Good Jeeves”, Wooster conveys his gratitude: “‘Jeeves,’ I said – and I am not ashamed to confess that there was a spot of chokiness in the voice – ‘there is none like you, none.’”

It is not hard to understand why the nouveau riche would want to cement their status with the trappings of manor houses of yore – or why the rich in general would want an even-tempered, well-trained member of staff to attend to their every desire. But I wondered why people still aspire to become butlers. Bryan Boyle, a sociologist at Vrije University in Brussels who is conducting an ethnography of the profession, has studied the paradoxes behind the motivations for pursuing such a career. Butlers, he told me, are “the perfect social intermediary between rich and poor” – required to behave with absolute altruism while working at the apogee of the class hierarchy. When considering that butlers are required to be simultaneously visible and invisible – Jeeves, for example, is known to apparate into the room – one begins to regard them as almost ethereal beings, flitting between two worlds.

Compared with other positions someone might pursue among the super-rich, such as “house manager”, personal assistant or yacht crew member, becoming a butler requires esoteric knowledge and ritualised behaviour. 

It requires someone to buy into the same fantasy as their employers – that their job is a calling, the pinnacle of service – even as it carries the financial and personal risks that come from entering an unregulated profession in which your career depends on the whims of a powerful individual. As one recruiter told me, butlers need “almost a demeaning attitude”....

....MUCH MORE

If interested see also:

February 2024
"Are You Fit to Be a Family Office CEO? Work on These Must-Have Qualities"
June 2019
"Superyachts, Mixing Drinks: The Truth About Family Office Jobs"
December 2017
"Family Offices as the Apex Of the New Butler Class"
March 2014
Family Office/Outside Managers Not Quite Cutting It? Maybe What You Need Is A Family Bank 

And many, many more.

"On Ultra-Processed Content"

From Professor (computer science, Georgetown) Cal Newport, June 19:

When I visited London last month, a large marketing push was underway for the paperback edition of Chris van Tulleken’s UK bestseller, Ultra-Processed People: Why Do We All Eat Stuff That Isn’t Food…and Why Can’t We Stop? It seemed to be prominently displayed in every bookstore I visited, and, as you might imagine, I visited a lot of bookstores.

Unable to ignore it, I eventually took a closer look and learned more about the central villain of van Tulleken’s treatise: ultra-processed food, a term coined in 2009 as part of a new food classification system, and inspired by Michael Pollan’s concept of “edible food-like substances.”

Ultra-processed foods, at their most damaging extreme, are made by breaking down core stock ingredients such as corn or soy into their basic organic building blocks, then recombining these elements into hyper-palatable combinations, rich in salt, sugar, and fat, soaked with unpronounceable chemical emulsifiers and preservatives.

As Chris van Tulleken points out, the problem with ultra-processed foods is that they’re engineered to hijack our desire mechanisms, making them literally irresistible. The result is that we consume way more calories than we need in arguably the least healthy form possible. Give me a bag of Doritos (a classic ultra-processed food) and I’ll have a hard time stopping until it’s empty. I’m much less likely to similarly gorge myself on, say, a salad or baked chicken.

I was thinking about this book recently as Scott Young and I were prepared to re-open our course, Life of Focus, for new registrations next week. One of the three month-long modules of this course focuses on implementing ideas from my book Digital Minimalism to help you regain control of your attention from the insistent attraction of screens.

It occurred to me that in this concept of ultra-processed food we can find a useful analogy for understanding both our struggles to disconnect, and for how we might succeed in this aspiration going forward.

To elaborate this claim, I want to be more specific in analogizing food to media content. To start, we can connect passive text-based media, such as books and articles, to minimally processed whole foods. Linguistic encoding was the first information-bearing media our species developed; something we’ve been working with for over 5,000 years.

This timeframe, of course, is too short for evolutionary forces to apply, but it’s plenty long for us to have culturally adapted to this format. As with whole foods, consuming writing tends to make us feel better, and we rarely hear concerns about reading too much.

We can next compare twentieth-century electronic mass media — that is, radio and television — to moderately-processed food like white bread, dry pasta, and canned soups. As with processed foods, we weren’t prepared for the arrival of new mass media forms that where much easier to consume and much more superficially palatable.

As a result, for the first time in our species’s interaction with media, over-consumption became a problem. (In the 1960s, the average household television viewing jumped past five hours per day.) Many social critics and educators began to rightly lament this sudden intrusion of electronic media into our cultural landscape (see, for example, this and this and this).

Many of the new media forms built on the consumer internet that subsequently emerged in the late 1990s can be similarly classified as moderately-processed. These include podcasts, newsletters, and blog posts. As with television and radio, the content itself can be valuable, but often times it’s not, and the ease of its delivery requires vigilance to protect against over-consumption.

This then brings us back to ultra-processed foods, which as the twentieth century gave way to the twenty-first, began to increasingly dominate our diets with their lab-optimized hyper-palatability. The clear analogy here is to digital information offered through the social media platforms that vaulted into cultural supremacy in the 2010s.

As described, ultra-processed foods are created by first breaking down cheap stock foods into their basic elements, and then recombining these ingredients into something unnatural but irresistible. Something similar happens with social media content. Whereas the stock ingredients for ultra-processed food are found in vast fields of cheap corn and soy, social media content draws on vast databases of user-generated information — posts, reactions, videos, quips, and memes. Recommendation algorithms then sift through this monumental collection of proto-content to find new, hard to resist combinations that will appeal to users.

A feedback loop soon develops in which the producers of this stock content (that is, those posting to social media) adapt to what seems to better please the platforms, simplifying and purifying their output to more efficiently feed the algorithms’ goal of hijacking the human desire mechanisms.

In this way, the users of social media platforms simulate something like the food scientist’s ability to break down corn and reconstitute it into a hyper-palatable edible food-like substances. What is a TikTok dance mash up if not a digital Dorito?

This analogy between food and media is useful because it helps us better understand responses to the latter. In the context of nutrition, we’re comfortable deciding to largely avoid ultra-processed food for health reasons. In making this choice, we do not worry about being labelled “anti-food,” or accused of a quixotic attempt to reject “inevitable progress” in food technology.

On the contrary, we can see ultra-processed good as its own thing — a bid for food companies to increase market share and profitability. We recognize it might be hard to avoid these products, as they’re easy and taste so good, but we’ll likely receive nothing but encouragement in our attempts to clean up our diets.

This is how we should think about the ultra-processed content delivered so relentlessly through our screens. To bypass these media for less processed alternatives should no longer be seen as bold, or radical, or somehow reactionary. It’s just a move toward a self-evidently more healthy relationship with information....

....MUCH MORE

"Singapore: The Crazy, Rich Rubber City-State"

From Global Financial Data,

Singapore Before Singapore.
Stamford Raffles founded Singapore as a trading post of the British East India Company in 1819. The city became part of the Straits Settlements in 1826 and its capital in 1836. The British were defeated in the Battle of Singapore on February 15, 1942 when 60,000 British troops surrendered to the Japanese in one of the worst defeats of British forces in history. The Japanese surrendered on August 15, 1945, but the failure of the British to protect Singapore from the Japanese lowered Britain’s standing in the eyes of Singaporeans. Malaysia and Singapore were granted self-government in 1959, but because of economic and political differences, Singapore seceded from Malaysia and became an independent republic on August 9, 1965. The Malayan Stock Exchange was set up on May 9, 1960. Floors for trading shares were set up in both Kuala Lumpur and in Singapore. After Singapore seceded, the structure of the stock exchange remained the same, but its name was changed to the Stock Exchange of Malaysia and Singapore. When currency interchangeability was terminated between Malaysia and Singapore in 1973, the Stock Exchange of Singapore separated from the Kuala Lumpur Stock Exchange. As this brief history shows, there was no trading of Singapore stocks in Singapore before 1960. Singapore stocks were traded in London or not at all. GFD has been able to collect data on a handful of Singapore stocks in order to put together an index of Singapore shares before local trading began.

Singapore Shares Before Independence
Singapore, as well as most of Malaysia, was a center for rubber production before World War II. The largest of these companies was the Straits Rubber Co., Ltd. which was registered in 1909, reorganized in 1919, and was acquired by Consolidated Plantations in 1972....

....MUCH MORE

Media: "Axel Springer, KKR near $13.5 billion break-up deal"

From Politico's sometimes enemy, sometimes frenemy, The Hill, September 14: 

German publisher Axel Springer and investment firm KKR are nearing a $13.5 billion break-up deal to split up the media giant, the Financial Times reported.

Both sides will discuss at a supervisory board meeting on Thursday the proposed structure of a deal that would give KKR a majority of the control over the company’s profitable classifies, people familiar with the matter told the outlet.

The deal values the entire company at $13.5 billion, including more than $10 billion for the classifieds business.

The split has already been discussed and the Financial Times first reported the talks in July.

If they come to a deal, it would allow German billionaire Mathias Döpfner to have control over the company’s media outlets, which include Politico and Business Insider, as well as German publications....

....MORE

"France’s baby bust"

A repost from March 2023.

Raising the question, among many others, how will pensions be paid for?

From Works in Progress, February 24:

France was once Europe’s superpower, thanks above all to its enormous population. Its decline coincided with a collapse in its birth rate – now we know why.

In the eighteenth century, France was the China of Europe. But after a thousand years of dominance based on particularly fertile land, she declined over the next 250 years to be just another European power. Around this time, more than 100 years before the rest of Europe, French women began to have fewer children. In 1700, almost 1 in 25 inhabitants on Earth, and one in five in Europe, was French. Today, less than a percent of humanity is French. Why did France’s population decline in relative terms so dramatically, and did it really mark the decline of France?

The demographic transition is usually thought to be driven by economic forces, but Рin France at least Рculture came first. Using data from online family trees, my work shows how the loosening of traditional religious moral constraints in Ancien R̩gime France drove the decline in fertility, setting France off on a wholly different course from England, which was about to see a dramatic increase in its population.


From the dawn of humanity to the eighteenth century, human life was dominated by starvation, poverty, wars, and pandemics. It was nasty, brutish, and short, just like that of apes or any other animals.

Whenever innovations raised the productivity of land, labor, or capital – and these innovations did take place – these simply led to fewer children dying or more children being born, with the extra economic output used to feed more hungry mouths. This was the history behind Thomas Malthus’s bleak 1798 prediction, in An Essay on the Principle of Population, that, since population growth is geometric but agricultural productivity growth can only be arithmetic, humanity was doomed to constant subsistence, with growth in the population always outstripping its ability to feed itself.


Malthus’s prediction proved false due to two paradigm shifts working together: the industrial revolution and the demographic transition. With the industrial revolution, unprecedented technological advancements took hold. The pace of human technological, scientific, and economic progress increased significantly and the human condition changed forever. But technological progress was not working alone.

The decline in fertility during the demographic transition was also a turning point in human history, because it marked the escape from the Malthusian mechanism. Instead of simply allowing for more and more people, the technological innovations brought by the industrial revolution could lead to better living standards, and economic growth was no longer short-lived. Investments in human capital and mass education could take place following the decline, which further propelled societies on the path to sustained economic growth.

If we were to condense all of human history into one short telling, it would look like this: millennia of stagnation, then the industrial revolution (in the eighteenth century), then the demographic transition (in the nineteenth century), then sustained economic growth – the dramatic leap forward experienced by humanity in the past few centuries.


Broadly, this narrative is accurate. But for Europe’s first superpower it is out of order. The historical decline in fertility took hold in France first, in the mid-eighteenth century and more than a century earlier than in any other country in the world....

....MUCH MORE

Friday, September 13, 2024

Nasty Business Traded On The LSE: "How oligarchs took on the UK fraud squad – and won"

 This one has intrigued me for a very long time.

Way back in 2016, while thanking the Financial Times' Henry Sanderson for a story that preceded a five-fold move in cobalt I asked what the renamed ERG formerly Eurasian National Resources Corporation (ENRC) was up to:

Big kudos to the FT's Henry Sanderson for recognizing one hell of a story and a small request for the Financial Times: Can you tell us what the old ENRC is up to these days?

In 2018 I repeated the plea, this time to Neil Hume, the FT's natural resources editor.

From The Guardian, September 12, 2024:

It began as a routine investigation into a multinational called ENRC. It became a decade-long saga that has rocked the UK’s financial crime agency. Now new documents illuminate a case that has rewritten UK law and is set to end with a huge bill handed to taxpayers

1: A body, a mine, a mystery

Clement Jackson was at home by the South African coast, tending to the meat on his beloved braai, when the call about the body came. He found contentment at the barbecue. Bald, with craggy features and prominent ears, he liked to impart the secrets of a succulent lamb shank or the perfect T-bone to his children. They were grown up, with children of their own, but even as he approached 60, Jackson was not ready to yield the tongs to them just yet.

Since heart trouble brought an early end to his police career 20 years earlier, Jackson had worked as a private detective. Born in 1959 – just as Nelson Mandela was going on trial for treason – he’d followed his father into the force. Jackson loved the sleuthing, assembling a jigsaw of evidence. Specialising in mining, he made his name in the late 1980s, when he cracked the smuggling rings that rich South Africans were using to squirrel bullion and precious stones abroad during the final years of apartheid.

The mining industry was an engine of the bribery, violence and inequality that continued to blight South Africa even after Mandela took power. So once Jackson began to take on private clients, there was plenty of detective work to do. In 2016, one of his industry contacts referred a new client to him. Jackson stepped away from the braai to take the call.

The American voice on the phone belonged to a mining investor. He wanted Jackson to investigate the mysterious death of a geologist who had worked on his South African ventures. The geologist’s name was André Bekker. The previous night, 28 October 2016, Bekker’s white Audi Quattro had been set alight on a suburban street in Johannesburg, South Africa’s commercial capital. When the flames burned out, Bekker’s charred body lay slumped against the back door.

Jackson agreed to take the case. A few days later, he flew to Johannesburg. He began by considering whether Bekker’s death could have been suicide. The fire appeared to have started at the front of the car. Could Bekker have ignited the blaze from the back seat, perhaps with a bullet? Next to impossible, Jackson was told when he visited an Audi dealership. The car had burned so hot that it seemed someone must have doused it with an accelerant. Jackson, as I reported years later, grew convinced this was a murder.

Bekker, Jackson learned, had been going through a divorce and his family suspected he sometimes paid for sex. But he found nothing to suggest that those close to Bekker wanted him dead. Each new lead hit a wall. Then one day in December 2016, Jackson arranged to meet a sensitive source he’d known for years. The source produced a piece of paper and drew a diagram of a multinational mining corporation Jackson had never heard of: ENRC.

With mines from Kazakhstan to Congo, ENRC – Eurasian Natural Resources Corporation – was once one of the most valuable companies on the London Stock Exchange, worth £20bn at its peak just a few years earlier. In 2007, when it floated, captains of British business, two of them with knighthoods, were appointed to ENRC’s board to steward this new giant of UK commerce. Soon, though, the business pages were carrying tales of boardroom ructions. The oligarch founders, three billionaires from the former Soviet Union known as the Trio, were fighting the company’s directors for control of this vast mining empire. The scandal deepened when allegations emerged that the prized mines ENRC had taken over in Africa were won with bribes.

Jackson’s source told him about another of ENRC’s African deals. In 2011, it had bought a manganese prospect in South Africa called Kongoni. The price was $295m. Which was odd. Because Kongoni was so remote and hard to mine that it was worth nothing like as much. That, at least, had been the view of an expert geologist who had examined it: André Bekker.

“This thing,” Jackson said to himself as he heard the dead man’s name, “it’s much deeper than we thought.”

Jackson worked his mining contacts to find out everything he could about the Kongoni deal. He came to think it was a fraud. Less than two years after the deal, the value of Kongoni recorded in ENRC’s accounts was not $295m – but zero. The company blamed a fall in the manganese price, suggesting the asset’s value might go up again. But Bekker had told others in the industry that Kongoni had never been worth $295m. Not even half as much. The geology just wasn’t good enough.

And there was another mystery. Who had ENRC bought Kongoni from? Beyond the names of some obscure offshore companies, the accounts did not say who had received ENRC’s $295m. Though he didn’t have definitive proof, Jackson suspected this was a scheme to siphon that money out of a British PLC....

....MUCH MORE

"Rules of Thumb and Adaptive Rationality"

From The Sideview, November 4, 2021:

Human cultures have used rules of thumb for centuries. During the past century, however, they have been vilified to near extinction. Is their demise justified? 

Rules of thumb are simple and practical cognitive shortcuts that make use of bodily and environmental features. Human cultures have used rules of thumb for centuries to guide agriculture, technological development, and other aspects of social life. During the past century, however, rules of thumb have been vilified to near extinction. Is their demise justified?


Frederick Winslow Taylor was on a mission—to replace traditional rule of thumb methods with scientific and standardized procedures. Following the rapid industrialization in the 19th century United States, a bottleneck in factory workflows had appeared that was all too obvious to Taylor. The unique, mnemonic, and idiosyncratic working methods of each artisan, engineer, or craftsman were incompatible with the modern factory operations that demanded scientific precision, timeliness, and predictable outcomes. Local artisanal traditions were not fit for the emerging modes of global mass production.

Taylor’s industrial philosophy came to be known as Taylorism. One key aspect of Taylorist principles,1 quoting Taylor himself, was to do away with “inefficient rule-of-thumb methods,” which were “still almost universal in all trades,” and in practicing which workmen “wasted a large part of their effort.” An effective industry, Taylor asserted, would have standardized workflows, guaranteed outcomes, and optimized divisions of labor. Notably, Taylorism caught the eye of communist and capitalist regimes alike: both were determined in the quest for what James C. Scott calls high modernism,2 where locally adapted knowledge would gradually be replaced with universally applicable standards and scientific guidelines.

For traditional rule of thumb methods, this was only the beginning of their misery. The vigor for thinking in terms of standardization, optimization and rationalization swept through the industrial world in the early 20th century, and soon found its way into the human and social sciences. First, unsurprisingly, this happened in the more established field of economics. But later, the standardization ethos found its way to our minds, as well, taking over the nascent fields of psychology and cognitive science. The cognitive revolution, as it came to be known, sought to discover the “laws” of how the mind, and its contents, operate. Its driving motives were to measure cognitive aspects such as intelligence and reasoning in terms of standardizable terminology—bell-curves and universal diagnostics. The upshot was that practically anything that deviated from the standardized, optimized, textbook “rational man” would be denigrated as invalid, malfunctional, or biased.

And so, rules of thumb received another blow. This time they were denigrated in the field of behavioral economics, where rules of thumb were discussed interchangeably with “heuristics”. Heuristics, these authors argued,3 were intuitive rule of thumb methods that people often resort to, but which regardless often led our minds astray and to suboptimal decisions. Eventually, a range of public policies ensued, led by fervent social scientists—the Nudge4 advocates—who took on their quest to help citizens overcome their heuristics and biases.

Altogether, it seems fair to say that rules of thumb have got a bad rap during the past century. Recently, however, critics have pointed out this isn’t entirely justified. Researchers in the new fields of ecological5 and adaptive rationality6 have highlighted that often, in everyday environments, good judgments do not require complex cognitions,7 and in appropriate contexts, rules of thumb may prove to be particularly adaptive. As Herbert A. Simon once wrote,8 rationality should be thought of as a pair of scissors, where one blade represents the mind and the other the structures of the environment. Only when both are in place is the mind’s cutting edge sharp. Instead of dismissing rules of thumb altogether, we should focus on context,  studying rules of thumb in the local environments they have adapted to operate in....

....MUCH MORE

Bringing to mind that guy and the fence.  

"The Boom in Zero-Day Options Is Coming for Tesla and Nvidia"

Well, I guess my work here is done. I'll check in if there are any breakthroughs in dopaminergic signaling or cascades but for now it looks like beach-time for yours truly.

From the Wall Street Journal, September 9:

Brokers and exchanges discuss expanding #0dte to options on individual stocks

A popular, fast-paced trade has boosted the options market to record volumes in recent years. Now, Wall Street is looking to push it even further.

Zero-day-to-expiry options let investors bet on whether a particular stock-market index will rise or fall by the end of the day. They have drawn an enthusiastic following among amateur investors, even as skeptics call them a form of gambling. They are sometimes known by the hashtag #0dte.

So far, the #0dte boom has been limited to options tied to indexes such as the S&P 500 or Nasdaq-100. The next frontier could be options on stocks such as Tesla or Nvidia.

Currently, options tied to individual stocks expire weekly, on Fridays. To bring #0dte to single-stock options, exchanges would need to add new expirations for Monday through Thursday.

Michael McCaskill, a 48-year-old day trader and volleyball-programs coordinator in Louisville, Ky., trades short-dated options in hopes of hitting the jackpot. He’s intrigued by the prospect of more-frequent expirations on single-stock options.

“The percentage gains are incredible,” said McCaskill, who has previously made profitable bets on GameStop, Netflix and PayPal. “It’s the short-dated options that give you that, whether it’s weekly or daily.”

Financial-industry executives hope that rolling out daily expirations on single-stock options can unleash a trading bonanza. But it would also pose new risks for investors, particularly for options that expire on days when a company reports earnings after 4 p.m. ET. With daily expirations, many more options would expire the same day as large, after-hours price moves. Few companies report earnings on Fridays.

During the past year, brokers, exchanges and electronic-trading firms—including heavyweights such as Charles Schwab and Citadel Securities—have discussed the pros and cons of bringing the #0dte model to options on individual stocks, people familiar with the matter said.

In closed-door industry meetings, retail brokerages such as Robinhood Markets, Schwab, Tastytrade and Morgan Stanley’s E*Trade have advocated for a cautious approach, concerned they could face a customer backlash if investors’ options trades blow up, the people said.

Other firms—including Susquehanna International Group, a huge options-market maker, and Nasdaq—have actively promoted bringing daily expirations to single-stock options, the people said. Both market makers and exchanges stand to benefit from the volumes that could come from further growth in the #0dte phenomenon.

The earliest that #0dte might come to options on individual stocks is late 2025, the people said. Some proponents of the move have suggested a limited launch, covering options on just a small number of stocks initially, to give investors time to adapt....

....MUCH MORE

If interested see also June's "How gamification took over the world" or a couple hundred others, 'search blog' box upper left, keyword: dopamine.

The Dalmatian Coast is nice, quiet with the crowds thinning out, ditto for Amalfi later in the year.

"OpenAI Acknowledges New Models Increase Risk of Misuse To Create Bioweapons"

And back to ChatBots. From/via Slashdot, September 13:

OpenAI's latest models have "meaningfully" increased the risk that AI will be misused to create biological weapons [non-paywalled link], the company has acknowledged. From a report: 

The San Francisco-based company announced its new models, known as o1, on Thursday, touting their new abilities to reason, solve hard maths problems and answer scientific research questions. OpenAI's system card, a tool to explain how the AI operates, said the new models had a "medium risk" for issues related to chemical, biological, radiological and nuclear (CBRN) weapons -- the highest risk that OpenAI has ever given for its models. The company said it meant that the technology has "meaningfully improved" the ability of experts to create bioweapons. AI software with more advanced capabilities, such as the ability to perform step-by-step reasoning, pose an increased risk of misuse in the hands of bad actors, according to experts.

Slashdot.org home.

Earlier
"First impressions of ChatGPT o1: An AI designed to overthink it"

And somewhat related today:
Use Case: "Talking to a chatbot may weaken someone’s belief in conspiracy theories"

A Potential Breakdown In The Transportation Sector

The trannies (DJTI) are not as reliable a leading, coincident/confirming indicator as they were when they were known as the Rails. The addition of passenger airlines to the Dow Jones Transportation Average - now five of the twenty components - and stuff like Avis Budget car rental and Uber meant analysts had to try other metrics e.g. the cardboard box index—which has problems including volatility and not capturing a large portion of the economy i.e. digital, asset light, intellectual property GDP generators.

So back to transportation, 2024 style. Lifted in toto from chartmeister Tim Knight at Slope of Hope, September 13:

Special Delivery

United Parcel Service (UPS) has been banging around, going nowhere, since July 27th. On my entire screen of quotes, it is the only red today at all. It hasn’t broken down from its range, but by God, it’s trying. If we can break $125, it opens the window up to a move through that entire white zone.


I’ve got $130 puts with an expiration way out into March 21st, to give this tons of time to work out.

Slope blog home

Coming into the close the stock is down $1.42 (1.11%) at $127.00.

UPS is a component of the DJ Transportation Average as is FedEx.

"First impressions of ChatGPT o1: An AI designed to overthink it"

Not even to the second of five levels.*

From TechCrunch, September 13: 

OpenAI released its new o1 models on Thursday, giving ChatGPT users their first chance to try AI models that pause to “think” before they answer. There’s been a lot of hype building up to these models, codenamed “strawberry” inside OpenAI. But does strawberry live up to the hype?

Sort of.

Compared to GPT-4o, the o1 models feel like one step forward and two steps back. ChatGPT o1 excels at reasoning and answering complex questions, but the model is roughly four times more expensive to use than GPT-4o. OpenAI’s latest model lacks the tools, multimodal capabilities, and speed that made GPT-4o so impressive. In fact, OpenAI even admits that “GPT-4o is still the best option for most prompts,” on its help page, and notes elsewhere that GPT o1 struggles at simpler tasks.

“It’s impressive, but I think the improvement is not very significant,” said Ravid Shwartz Ziv, an NYU professor who studies AI models. “It’s better at certain problems, but you don’t have this across-the-board improvement.”

For all of these reasons, it’s important to use GPT o1 only for the questions it’s truly designed to help with: big ones. To be clear, most people are not using generative AI to answer these kinds of questions today, largely because today’s AI models are not very good at it. However, o1 is a tentative step in that direction....

Following on September 8's "ChatBots Are Not The Be-All And End-All Of Artificial Intelligence":

Far from it.
And all the focus on ChatBots and LLMs are more than just a distraction, they are a perverse representation of what AI is doing and will do and could potentially cost you money or opportunity or both....

For reference here is the roadmap OpenAI is pitching, via Bloomberg, July 11:

OpenAI Scale Ranks Progress Toward ‘Human-Level’ Problem Solving

....MUCH MORE

And from Decrypt, September 3:
What we know about the secretive AI projects pushing the limits of what OpenAI can do..... 

CORRECTED—Belated Anniversary: Five Years Ago BlackRock Gave The Fed Its Marching Orders For The Coming Disaster

CORRECTION—Adding the meat of the matter which was inadvertently left out.

Since we are doing five-year anniversaries, here's another, though belated because with over 300,000 items in the link-vault the importance of proper filing becomes critical. Ahem.

A repost with a couple links upfront. The links to the 2019 BlackRock blog entry and the more substantial white paper have either rotted or been removed from the internet. Fortunately they were captured by the Internet Archive:

August 20, 2019:  How central banks might deal with the next downturn and August 2019:

Dealing with the next downturn:
From unconventional monetary policy to
unprecedented policy coordination

https://web.archive.org/web/20190906135549/https://www.blackrock.com/
corporate/literature/whitepaper/bii-macro-perspectives-august-2019.pdf

And the repost, October 15, 2022 (added):

Flashback: That Time Just Weeks Before Covid That BlackRock Told The Fed Exactly What It Wanted The Fed To Do (BLK)

We first posted this on August 21, 2019. That was three months before Covid-19 started filtering into the world's consciousness.*

Three years later it reads like the blueprint for what actually happened.

BlackRock: "How central banks might deal with the next downturn"

When did recessions become equivalent to the bubonic plague?
Reading the news opinions of the last couple weeks you would think the entire world has been sentenced to death or something.
Get a grip.
Everyone over the age of 25 has survived three quite serious recessions.

Those with more ahhh... experience have lived through five of the beasties if over age 40 and seven if age 50.

With that mini-rant out of the way here is Elga Bartsch, the head of economic and markets research at BlackRock Investment Institute. Her mini-bio says "Dr. Bartsch was Global Co-Head of Economics and Chief European Economist at Morgan Stanley in London"
I have heard of this Morgan and Stanley.

[note, October 15, 2022: not sure why I was comparing recession to "bubonic plague" and "sentenced to death". It must have been something in the air as I was clueless about covid til weeks later.]
From the BlackRock blog:

Elga discusses the challenges facing central bankers when the next downturn comes – and makes some unprecedented policy suggestions. This is the first in a series of four blogs on the topic of “Dealing with the next downturn.”
Unprecedented policies will be needed to respond to the next economic downturn. Monetary policy is almost exhausted as global interest rates plunge toward zero or below. Inflation expectations are dragging on actual inflation. See the chart below.

https://www.blackrock.com/blk-one-c-assets/cache-1590658508000/images/media-bin/web/one/us/insights/blogs/Expectations-drag.png

Sources: BlackRock Investment Institute, with data from Refinitiv Datastream, August 2019. Notes: This chart shows the actual change in the annual rate of U.S. core inflation and estimates of the contributions of various economic drivers. The factors are broken down by percentage point of contribution to the overall implied Phillips curve inflation from the starting point in 2007. The implied Phillips curve estimates are partly based off the August 2013 paper The Phillips Curve is Alive and Well. Instead of modelling inflation expectations via lags we use the measure of inflation expectations similar to the 2010 paper Modeling Inflation after the Crisis.

Fiscal policy on its own will struggle to provide major stimulus in a timely fashion given high debt levels and the typical lags with implementation. Without a clear framework in place, policymakers will inevitably find themselves blurring the boundaries between fiscal and monetary policies. This threatens the hard-won credibility of policy institutions and could open the door to uncontrolled fiscal spending.

In our new paper, “Dealing with the next downturn,” we outline the contours of a framework to mitigate this risk so as to enable an unprecedented coordination through a monetary-financed fiscal facility. Activated, funded and closed by the central bank to achieve an explicit inflation objective, the facility would be deployed by the fiscal authority.
Below are the main highlights from the paper. Further blogs will go into more detail on the crucial points.
  • There is not enough monetary policy space to deal with the next downturn: The current policy space for global central banks is limited and will not be enough to respond to a significant, let alone a dramatic, downturn. Conventional and unconventional monetary policy works primarily through the stimulative impact of lower short-term and long-term interest rates. This channel is almost tapped out: One-third of the developed market government bond and investment grade universe now has negative yields, and global bond yields are closing in on their potential floor. Further support cannot rely on interest rates falling.
  • Fiscal policy should play a greater role but is unlikely to be effective on its own: Fiscal policy can stimulate activity without relying on interest rates going lower – and globally there is a strong case for spending on infrastructure, education and renewable energy with the objective of elevating potential growth. The current low-rate environment also creates greater fiscal space. But fiscal policy is typically not nimble enough, and there are limits to what it can achieve on its own. With global debt at record levels, major fiscal stimulus could raise interest rates or stoke expectations of future fiscal consolidation, undercutting and perhaps even eliminating its stimulative boost....

....MORE  

The link in the original post has rotted, as has the link to the graph.

Here is the current version of that page:
https://www.blackrock.com/us/individual/insights/how-central-banks-might-deal-with-the-next-downturn
And here is the much more complete 16 page PDF
https://www.blackrock.com/corporate/literature/whitepaper/bii-macro-perspectives-august-2019.pdf

May you live in interesting times.

The key points from the 2019 White Paper:

An unprecedented response is needed when monetary policy is exhausted and fiscal policy alone is not enough. That response will likely involve “going direct”: Going direct means the central bank finding ways to get central bank money directly in the hands of public and private sector spenders. Going direct, which can be organised in a variety of different ways, works by: 1) bypassing the interest rate channel when this traditional central bank toolkit is exhausted, and; 2) enforcing policy coordination so that the fiscal expansion does not lead to an offsetting increase in interest rates. 
An extreme form of “going direct” would be an explicit and permanent monetary financing of a fiscal expansion, or so-called helicopter money. Explicit monetary financing in sufficient size will push up inflation. Without explicit boundaries, however, it would undermine institutional credibility and could lead to uncontrolled fiscal spending.
*I think the story that grabbed my attention was from China's Global Times, January 1, 2020:

Police in Central China's Wuhan arrested 8 people spreading rumors about local outbreak of unidentifiable #pneumonia. Previous online posts said it was SARS

http://web.archive.org/web/20200107195600/https://twitter.com/globaltimesnews/status/1212409846684884995

But credit where credit is due, recognition that the story was important was probably kindled by some of ZeroHedge's posts in December 2019 that had filtered into the subconscious.

If interested see also: 

Five Year Anniversary: Wuhan Institute Of Virology Takes Public Database Of Samples And Sequences Offline