BRIEFLY NOTED: For 2023-05-13 Sa
Inflation not a serious problem; the raccoons of Chicago; Google's "Project Tailwind"; Wolf on AI, Del Mastro on how prices are not real things, WaterGirl on the corrupt Supreme Court, & Best hopin...
MUST-READ: Current State of þe Housing Market:
Bill McBride: Part 2: Current State of the Housing Market; Overview for mid-April: ‘In May 2021, the payment on a $500,000 house, with a 20% down payment and 3.09% 30-year mortgage rates, would be around $1,706 for principal and interest. The monthly payment for the same house, with house prices up 22.5% over two years and mortgage rates at 6.49%, would be $3,095 - an increase of 81%…. Economist Len Kiefer recently pointed out that “having nearly 2 out of 3 mortgages with a rate of 4% or less and market rates over 6% isn't going to help with the inventory situation”…. This is very different from the housing bust, when many homeowners were forced to sell as their teaser rates expired and they could not afford the fully amortized mortgage payment. The current situation is similar to the 1980 period, when rates also increased quickly…
My view: we are not going to seat any significant declines in housing prices; rather, the market will freeze up because people who would otherwise move to bigger houses. We will not be financially able to give up their current mortgage in order to do so.
ONE IMAGE: Chicago Raccoons:
ONE VIDEO: Google I/O: Project Tailwind & c.:
Steven Johnson: Project Tailwind: ‘An early look at a new experimental “tool for thought” that I’ve been developing with Google… source-grounded AI…. Tailwind allows you to define a set of documents as trusted sources which the AI then uses as… ground truth… to craft a role for the LLM that is not an all-knowing oracle or your new virtual buddy, but something closer to an efficient research assistant…. Making an on-the-fly glossary based on a specific topic…. Tailwind works extremely well as an extension of my memory. I’ve uploaded my “spark file” of personal notes that date back almost twenty years, and using that as a source, I can ask remarkably open-ended questions… all accompanied by citations if I want to refer to the original direct quotes…
Very Briefly Noted:
Lauren Weber: Workers Are Happier Than They’ve Been in Decades: ‘Labor shortages and shifting expectations lead to improvement for millions, survey shows…
Dan Davies: Songs my portfolio manager taught me (part 1): ‘When a short position goes wrong, it gets bigger… no best ideas without a stop loss… good analysts and bomb throwers…
Matt Levine: Companies Are Allowed to Do Bad Mergers: ‘Block/Tidal…
Sophia Kalantzakos & Kunda Dixit: The Global Climate System’s Himalayan Hotspot: ‘As temperatures rise, the Himalayas are experiencing accelerated glacial melt, with dire consequences for water supplies and ecosystems far and wide. Unfortunately, the current reshuffling of the world order could overlook one of the most critical threats to global stability…
Tim Duy: Fed Watch 1/10/23: ‘On the surface, the April CPI report did not appear amenable to a pause…. The internals, however, were more promising…. Services less energy and shelter grew just 0.1%. My preferred measure, core excluding shelter and used vehicles, fell to a 1.9% annualized pace, a sharp reversal of a more worrisome trend that developed toward the end of last year…
Ortenca Aliaj: US lenders warned that commercial property is ‘next shoe to drop’: Executives and investors fret about impact of rising rates and empty buildings on $5.6tn market…
Casey Newton: How Google is making up for lost time: ‘The company is finally bringing AI to the places that matter…
James Palmer: ‘America: we'll delay publishing the investigation into the spy balloon to try and keep meetings on track. China: i read online that America is going to make bioweapons to wipe out the Chinese race…
Trekkie Bill: ‘Remember when #startrek was subtle in its messaging? Neither do I…
John Springford: Are the costs of Brexit Big or Small?: ‘Critics say my estimate – that the British economy is around 5 per cent smaller due to Brexit – is implausibly large. This insight tests their scepticism against other ways to estimate the cost of Brexit…
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Martin Wolf: The threat and promise of artificial intelligence: ‘It might be the most transformative technology of all for human beings’ sense of themselves. In 1900, the UK had 3.3mn horses. These animals provided pulling power, transport and cavalry. Today, only recreation is left. Horses are an outmoded technology. Their numbers in the UK have fallen by around 75 per cent. Could humans, too, become an outmoded technology, displaced by machines that are not just stronger and more dexterous but more intelligent, even more creative?… Humanity is Doctor Faustus. It, too, seeks knowledge and power and is prepared to make almost any bargain to achieve it, regardless of consequences. Even worse, it is a species of competing Doctor Faustuses, who seek knowledge and power, as he did. We have been experiencing the impact of the social media revolution on our society and politics. Some warn of its consequences for our children. But we cannot halt the bargains we have made. We will not halt this revolution either. We are Faustus. We are Mephistopheles. The AI revolution will roll on…
Addison Del Mastro: Prices Aren't Metaphysics: ‘Market signals, not revelations…. People who reply, when I talk about housing affordability, something like, “I just think people should buy what they can afford.”… Some people view prices not as market signals, but as metaphysical facts or revelations: This thing is valuable, and lowering its price would be to devalue it. Not in the obvious economic sense, but in some vague moral sense. In other words, “What you can afford” is a fixed thing, not an accident of market or regulatory forces. And wanting to lower prices is the same thing as demanding something—another fixed thing—that you can’t afford…
WaterGirl: Supreme Court Corruption: Harlan Crow & Clarence Thomas, Continued: ‘My opinion is that we should point out the supreme amount of corruption in the highest court of the land, every single day, for as long as it takes. This cannot be normalized. Make them pay. Hound the corrupt bastards every single day until they decide that life’s too short. They are counting on us to let this slip into this is just one more thing that’s so terribly wrong but there’s nothing we can do about it territory. Sen. Sheldon Whitehouse is leading the charge, but he shouldn’t be out there alone, as he has been for most of the past 5 years….
Chris Best: Toward a better media system: ‘You can’t rely on social media…. You need only look at the fates of BuzzFeed, Mic, and Upworthy to see what happens when a media business over-relies on social platforms…. Of course, for writers to realize the impact they seek for their work, they need ways for readers to find them. One compelling path is for actual humans, loving their work, to share it with other actual humans…
I was drawn to "the racoons of Chicago" thinking it would be about quite something else.
If we were in the Sixties or Seventies, when there were still ethical ideals in place, Clarence Thomas would have already resigned. However, the win at any cost mentality of modern Republican killed their commitments to Dennis.