If you want to skim this, here’s the overview
- Wednesday is FOMC, I’m firmly in 25bps hike camp, unless something crazy happens with the data
-Weird AI newscyle: Dario, Sam, Elon, Sundar(not him, just kidding) all want to slow down the pace of AI
-Main story is the labor market, deep dive below.
Hello traders,
Hope you had a great weekend and some time away from screens.
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AI LEADERS ARE TELLING EVERYONE TO SLOW DOWN RIGHT BEFORE THE IPO
The biggest news over the weekend was that the holy trinity of AI Dario, Sam and Elon urged everyone to take a step back on AI development.
This has caused a small selloff in AI and tech stocks in the weekend market
I have shared my thoughts on stopping AI research three and a half years ago here.
AI development genie is out of the bottle now and I would rather have the west reach ASI than China doing so. However, employment impacts of large scale cheap intelligence is not something we can take lightly.
THE FED AND THE FAMILY FIGHT
Moving on,
We have an important Fed meeting coming up this Wednesday.
We are now looking at a near certain 25bps hike and there has been some chatter about a surprise 50bps hike as well. I’m in the 25bps camp barring some crazy economic data dropping between now and Wednesday.
TALE OF TWO ECONOMIES
The economy is currently bifurcated into two drastically different outcomes for men and women. One that is doing exceedingly well and other that is staring at the bottom of the barrel. Trump administration is turning out to be the most feminist administration of all time. This is probably a tough pill to swallow for most but the data show an insane skew which has left the data guys(me) aghast. The divergence cannot be dismissed anymore.Have a glance at the report below
I do not want to take a societal/moralistic stance here but we are looking at this from a lens of understanding where the puck is going to be in 24-36 months from now. Infographic to follow
cue suspenseful music
Now let us look at the stocks which directly are in play due to the macroeconomic landscape.
Disclaimer: Stocks mentioned here are for informational purposes only and should not be construed as investment advice. My lawyer has told me to write more such things, so there are more at the end of this newsletter.
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Winners picked Friday.
