Thursday, 23 November 2023

For Most A Time To Be Thankful. The OpenAI Follies.

Baltic Dry Index. 1755 -41            Brent Crude  80.96

Spot Gold 1997                  US 2 Year Yield 4.89 +0.03

Wall Street is the only place that people ride to in a Rolls Royce to get advice from those who take the subway.

Warren Buffett.

With both the US stock casinos and Japan’s closed for holidays, the thiner trading conditions elsewhere make for an easier time to rig the casinos higher and run a short squeeze.

Today’s worrying news is that the first hostage release has been delayed by at least 24 hours. No word so far as to the cause of the delay.

In other news, the winner of the snap Dutch election seems to have been a far right, anti-immigrant party.  If they make it into the next governing coalition, the EUSSR is in for an interesting few years. The weekend OPEC meeting has been delayed until November 30th.

Finally, for more on the OpenAI governance farce, scroll down to the last section.

A Happy Thanksgiving to all celebrating Thanksgiving today.  In truth, nearly all of us outside of Ukraine, Gaza, inflation hit Argentina and some flooded parts of Africa, have much to be thankful for, though you wouldn't know that listening to the far left BBC.


Asia markets mixed even as Wall Street goes into Thanksgiving with a rally

UPDATED WED, NOV 22 2023 11:03 PM EST

Asia-Pacific markets are mixed after Wall Street went into the Thanksgiving holiday with a broad based rally.

More than half of the stocks trading on the New York Stock Exchange were up Wednesday. The tech-heavy Nasdaq also saw greater participation, with 62.9% of the stocks in the index rising. Small- and mid-caps outperformed Wednesday, rising 0.7% and 0.6%, respectively.

In Asia-Pacific, Australia’s S&P/ASX 200 was down 0.5%, extending losses from the day before.

The country saw its business activity contract at a faster pace in November, according to flash estimates from Judo Bank. Australia’s composite purchasing managers index slid to 46.4, down from October’s 47.6.

South Korea’s Kospi reversed earlier gains and dropped 0.13%, but the small-cap Kosdaq advanced 0.45%.

Hong Kong’s Hang Seng index slipped 0.34%, but the mainland Chinese CSI 300 index was marginally up.

Japan’s markets are closed due to a public holiday.

Overnight in the U.S., all three major indexes rebounded from Tuesday’s losses, with the benchmark 10-year Treasury yield also briefly falling to its lowest level in two months.

The yield on the 10-year Treasury briefly fell to 4.369% Wednesday morning, the lowest level since Sept. 22. It later recovered and was last little changed at 4.41%.

The Dow Jones Industrial Average gained 0.53%, while the S&P 500 climbed 0.41%. The Nasdaq Composite advanced 0.46%.

Asia stock markets today: Live updates, Singapore inflation, Australia PMI (cnbc.com)


European markets head for mixed open ahead of euro zone business activity data

UPDATED THU, NOV 23 2023 12:33 AM EST

European markets are heading for a mixed open Thursday, echoing sentiment in the Asia-Pacific region overnight.

Investors in Europe will be keeping an eye on preliminary purchasing managers’ index data from the euro zone for November for the latest indication of economic activity in the services and construction sectors.

Markets will also be keeping an eye on Dutch election results after an exit poll showed right-wing populist Geert Wilders to be on track for a dramatic victory with his Freedom Party, the PVV.

In other news, U.S. stocks rose Wednesday after the benchmark 10-year Treasury yield briefly fell to its lowest level in two months and the November market rally broadened into the Thanksgiving holiday.

European markets live updates: PMIs, stocks, news, data and earnings (cnbc.com)


Big investors say US markets rally could prove short-lived

By Carolina MandlSvea Herbst-Bayliss and David Randall

NEW YORK, Nov 22 (Reuters) - The recent rally that has lifted U.S. stocks and bonds is more of a year-end rebound than a turning point, according to big money managers, who see fiscal and monetary policies, next year's presidential election and recession fears as likely to start weighing on markets.

Since late October, the S&P 500 (.SPX) has rallied roughly 10% and the Nasdaq (.IXIC) has surged 13%, as investors increased bets that the Federal Reserve's tightening cycle is over after signs of cooling inflation and job growth and a better-than-expected third-quarter earnings season.

 

Ten-year Treasury yields hit a 16-year high of 5.021% in late October, but have fallen back to 4.414%. Lower yields have driven a technology-fueled equities rally.

Some big investors and advisers believe, however, that reasons to cheer are short-lived and growing concerns over the economy will start weighting on asset prices early next year.

"We've started seeing some signs that things are a little weaker than what people may believe," Ryan Israel, chief investment officer of Bill Ackman's Pershing Square Capital Management, told clients last week, adding the main focus now is where the economy is heading.

Markets may have “gone too far in extrapolating” rate cuts in early 2024 from recent data suggesting that consumer inflation is falling and the U.S. labor market is weakening, said Mohamed El-Erian, an adviser to financial services firm Allianz SE (ALVG.DE).

While inflation has become less front-and-center after U.S. consumer prices were unchanged in October, on investors' minds is the fallout from the Fed's 525 basis points in total interest rate hikes since March 2022 coupled with the central bank's efforts to reduce its balance sheet, under its so-called quantitative tightening.

Overall, growth in the global economy is expected to slow in 2024, hit by elevated interest rates, higher energy prices and cooler growth in the world's two largest economies, the U.S. and China. Most economists, however, believe the world will avoid a recession.

----The U.S. presidential race next year is also a concern because it could be a source of more market instability. "As we get into 2024, with a general election that's going to be extremely contested, I think we're going to see more risks there," said Max Gokhman, head of MosaiQ investment strategy at Franklin Templeton.

MAGNIFICENT SEVEN

One of the biggest sources of uncertainty for investors is the performance of the so-called Magnificent Seven group of very large companies, which have driven stock indexes this year.

Bill Gross, the co-founder of bond giant Pimco who now manages his own money and that of his foundation, told Reuters in an email that the drop in yields has largely benefited technology stocks, which are also riding investor enthusiasm for artificial intelligence. But he sees little room for the 10-year Treasury yield to move lower at 4.45%. "Do not look for yields to be a contributing factor in the future," he said.

For a new boost in market performance, tech stocks will depend more on showing how AI can lift results, investors said.

More

Big investors say US markets rally could prove short-lived | Reuters

“When you combine ignorance and leverage, you get some pretty interesting results.”

Warren Buffett.

Global Inflation/Stagflation/Recession Watch.

Given our Magic Money Tree central banksters and our spendthrift politicians, inflation now needs an entire section of its own.

Factbox-Global economy to slow down but likely avoid recession in 2024

November 22, 2023

(Reuters) -Some of the major banks in the world expect global economic growth to ease further in 2024, squeezed by elevated interest rates, higher energy prices and a slowdown in the world's two largest economies.

The global economy is forecast to grow 2.9% this year, a Reuters poll showed, with next year's growth seen slowing to 2.6%.

Most economists expect the global economy to avoid a recession, but have flagged possibilities of "mild recessions" in Europe and the UK.

A soft-landing for the United States is still on the cards, although uncertainty around the Federal Reserve's monetary tightening path clouds the outlook. China's growth is seen weakening, exacerbated by companies seeking alternative cost-efficient production destinations. Following are forecasts from major global banks:

Real GDP growth forecasts for 2024

GLOBAL U.S. CHINA EURO UK INDIA

AREA

2.60% 2.10% 4.80% 0.90% 0.6% 6.3%

Goldman

Sachs

2.80% 1.90% 4.20% 0.50% 6.4%

Morgan -0.1%

Stanley

UBS 2.60% 1.10% 4.40%

0.60%

0.6% 6.2%

Barclays 2.60% 1.20% 0.1%

0.30%

4.40% 6.2%

2.20% 1.60% 4.90% 0.40% 0.2% 5.7%

More

Factbox-Global economy to slow down but likely avoid recession in 2024 (msn.com)

Covid-19 Corner

This section will continue until it becomes unneeded.

Long Covid 'changes brains' of people who have it differently to those who recover, University Hospital Freiburg study finds

November 22, 2023

Long Covid changes the brains of people differently to those who recover from the virus, reveals new research. Up to one in four people infected by the virus develop the debilitating condition now referred to as “Long Covid.”

People with Long Covid may suffer a range of symptoms - including difficulty concentrating, change in sense of smell or taste, tiredness, joint or muscle pain, shortness of breath and digestive issues. The symptoms may persist for weeks, months, or - as is only now becoming apparent - years after the initial Covid-19 infection.

But the basis of the condition is poorly understood. Now German scientists have found that people with Long Covid exhibit patterns of changes in the brain that are different from fully recovered Covid-19 patients. They used diffusion microstructure imaging (DMI), a new MRI technique, to detect the changes.

Study lead author Doctor Alexander Rau, of University Hospital Freiburg, said: “To the best of our knowledge, this is the first study comparing patients with Long Covid to both a group without history of Covid-19 and a group that went through a Covid-19 infection but is subjectively unimpaired."

He explained that DMI looks at the movement of water molecules in tissues. By studying how water molecules move in different directions and at various speeds, DMI can provide detailed information on the microstructure of the brain.

Scientists say it can detect even very small changes in the brain, not detectable with conventional MRI. Dr Rau and his colleagues compared MRI brain scans of three groups: 89 patients with Long Covid, 38 that had contracted Covid-19 but did not report any long-term symptoms, and 46 healthy controls with no history of Covid.

The research team first compared the cerebral structure of the three groups to test for atrophy or any other abnormalities. They then used DMI to gain a deeper insight into the brain.

The three groups were compared to reveal group differences in the brain’s microstructure. DMI parameters were read for the grey matter in the brain. Whole brain analyses were also used to reveal the spatial distribution of alterations and associations with clinical data, including Long Covid symptoms such as fatigue, cognitive impairment or impaired sense of smell.

The results showed no brain volume loss or any other lesions that might explain the symptoms of Long Covid. However, Covid-19 infection induced a "specific pattern" of microstructural changes in various brain regions, and the pattern differed between those who had Long Covid and those who did not.

More

Long Covid 'changes brains' of people who have it differently to those who recover, University Hospital Freiburg study finds (msn.com)

Technology Update.

With events happening fast in the development of solar power and graphene, among other things, I’ve added this section. Updates as they get reported.

Sam Altman reinstated as CEO of OpenAI

Paul Ridden  November 22, 2023

After five days of turmoil at OpenAI following the firing of CEO Sam Altman, and much support from investors and employees, the company has confirmed that he is returning as Chief Executive, together with a board reshuffle.

The drama at OpenAI began last Friday when board members Ilya Sutskever, Adam D'Angelo, Tasha McCauley and Helen Toner fired company co-founder and CEO Sam Altman, with Chairman and President Greg Brockman also exiting after being removed from the board.

Though the reasons behind the move have not been fully explained, chaos ensued in the days following, including a groundswell of support for Altman from employees – 95% of whom threatened to quit if the old leadership wasn't restored.

Microsoft stepped into the fray and offered Altman and Brockman jobs, and an interim CEO put in place, in the shape of former Twitch chief Emmett Shear.

A couple of hours ago, OpenAI posted an update to X stating that an "agreement in principle" had been reached to secure the return of Altman as CEO, but that the fine print was still being worked on. The same post also revealed a board shake up, with everyone apart from D'Angelo gone, who has now been joined by Bret Taylor and Larry Summers on an interim board.

Post's from Altman and Brockman confirmed their return, with the latter following up with a photo of smiles all around at OpenAI and a message of appreciation to the 710+ employees who stood by the leadership team.

The dust is still settling on the story, but it seems that the chaotic drama is almost at an end.

Sam Altman reinstated as CEO of OpenAI (newatlas.com)

Exclusive: OpenAI researchers warned board of AI breakthrough ahead of CEO ouster, sources say

By Anna TongJeffrey Dastin and Krystal Hu 

Nov 22 (Reuters) - Ahead of OpenAI CEO Sam Altman’s four days in exile, several staff researchers wrote a letter to the board of directors warning of a powerful artificial intelligence discovery that they said could threaten humanity, two people familiar with the matter told Reuters.

 

The previously unreported letter and AI algorithm were key developments before the board's ouster of Altman, the poster child of generative AI, the two sources said. Prior to his triumphant return late Tuesday, more than 700 employees had threatened to quit and join backer Microsoft (MSFT.O) in solidarity with their fired leader.

The sources cited the letter as one factor among a longer list of grievances by the board leading to Altman's firing, among which were concerns over commercializing advances before understanding the consequences. Reuters was unable to review a copy of the letter. The staff who wrote the letter did not respond to requests for comment.

After being contacted by Reuters, OpenAI, which declined to comment, acknowledged in an internal message to staffers a project called Q* and a letter to the board before the weekend's events, one of the people said. An OpenAI spokesperson said that the message, sent by long-time executive Mira Murati, alerted staff to certain media stories without commenting on their accuracy.

Some at OpenAI believe Q* (pronounced Q-Star) could be a breakthrough in the startup's search for what's known as artificial general intelligence (AGI), one of the people told Reuters. OpenAI defines AGI as autonomous systems that surpass humans in most economically valuable tasks.

Given vast computing resources, the new model was able to solve certain mathematical problems, the person said on condition of anonymity because the individual was not authorized to speak on behalf of the company. Though only performing math on the level of grade-school students, acing such tests made researchers very optimistic about Q*’s future success, the source said.

Reuters could not independently verify the capabilities of Q* claimed by the researchers.

'VEIL OF IGNORANCE'

Researchers consider math to be a frontier of generative AI development. Currently, generative AI is good at writing and language translation by statistically predicting the next word, and answers to the same question can vary widely. But conquering the ability to do math — where there is only one right answer — implies AI would have greater reasoning capabilities resembling human intelligence. This could be applied to novel scientific research, for instance, AI researchers believe.

More

Exclusive: OpenAI researchers warned board of AI breakthrough ahead of CEO ouster, sources say | Reuters

Let Wall Street have a nightmare and the whole country has to help get them back in bed again.

Will Rogers. 

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