Weekend Papers Summary
FINANCIAL TIMES
-The US stock market has seen its strongest annual performance in two years, with the S&P 500 index rising 24% in 2023. This performance was driven by investors anticipating that central banks will cut interest rates rapidly next year. The MSCI World Index also saw a 22% increase for the year. The shift in interest rate expectations was driven by faster-than-expected inflation in western economies.
-In 2023, the tech industry saw the launch of OpenAI's ChatGPT, which enabled computers to generate text or images with human-like abilities. This led to a race to integrate generative AI into everyday products and services. Microsoft CEO Satya Nadella and Google CEO Sundar Pichai praised the technology, predicting its importance surpassing fire or electricity. Erik Brynjolfsson predicts that generative AI's impact on working practices could lead to a productivity boom across the global economy.
-US states Colorado and Maine have disqualified Donald Trump from participating in the upcoming presidential election. However, Trump's prospects are limited as he is expected to appear on the ballot in early voting states like Iowa and New Hampshire. The Supreme Court may overturn these challenges, but the moves serve as a reminder of Trump's unprecedented efforts to deny Biden's victory and fuel the January 6 assault on legislature seats.
-China has appointed former navy chief Dong Jun as its new defence minister, four months after his predecessor disappeared from public view. The appointment could help smooth engagement between Beijing and Washington on defense matters. The appointment comes as President Xi Jinping tightens control over China's armed forces amid a crackdown on alleged corruption among senior government officials.
-South Africa has accused Israel of violating international laws on genocide in its military operations in Gaza, arguing that Israel has failed to prevent genocide and is committing genocide against Palestinians. The South African application to the UN's International Court of Justice seeks an immediate halt to Israeli military operations and calls for early hearings in the new year.
-Samsung, Motorola, Huawei, and Honor are all betting on foldable phones to revive the mobile market, despite their lackluster success. Foldable phones, which open like a book or compact mirror, only account for 1% of all smartphones sold globally. Samsung has doubled its investment in marketing, with estimates suggesting they may surpass a third of all smartphones costing more than $600 by 2027. Other manufacturers, including Motorola, Huawei, and Honor, are also hoping foldable phones will help revive the market.
-Big tech companies have outspent venture capital groups in generative AI start-ups this year, with Microsoft, Google, and Amazon reportedly raising two-thirds of the $27B raised by AI companies in 2023. This surge in investment, which exploded after OpenAI's ChatGPT launch, demonstrates the dominance of Silicon Valley groups in the industry. The rise of generative AI systems has also attracted top Silicon Valley investors, but VCs have been forced to slow down spending due to higher interest rates and falling valuations.
-The US Securities and Exchange Commission (SEC) has proposed that funds must hold enough "highly liquid securities" to cope with 10% of their assets losing in a day, using a method called "swing pricing". The proposal was prompted by market turbulence during the Covid-19 pandemic, highlighting the need for stricter rules to protect buy-and-hold investors from losses. However, industry groups argue that the proposal would reduce overall returns and force funds holding loans and less liquid assets to close down completely. The SEC has held 16 meetings with investors, providers, and lobbyists since September, and received over 3,000 comment letters, mostly in opposition.
-Iran has executed three men and one woman on Friday, accused of co-operating with Israel's intelligence services. The executions come after an air strike killed a senior Iranian commander, Razi Mousavi, in Syria. Iranian officials blamed Israel for the assassination and reserved the right to respond in kind. Israel and Iran have been engaged in an increasingly overt shadow war across the Middle East, with Syria becoming a constant battleground. Damascus International Airport was hit by alleged Israeli air strikes, after only recently resuming operations following prior attacks.
-Statkraft, Europe's largest renewable energy producer, is investing €700 million to upgrade its hydropower dams to withstand heavier rains, highlighting the risks of climate change on energy security and companies' finances. The Norwegian state-owned company plans to strengthen over 70 dams over the next five to 10 years, focusing on "climate change resilience and energy security in practice." The upgrades will include the 130 megawatt Trollheim hydropower plant in southern Norway, the 106MW Høyanger plant in the west, and the 500MW Rana plant in the north.
-Spain's new economy minister is Carlos Cuerpo, former head of the treasury and key negotiator in EU fiscal rules. Cuerpo will replace Nadia Calviño, who leaves to head the European Investment Bank. Spain's economy is stronger than many EU peers but faces a crunch year with tough debt reduction rules. Cuerpo is described as a young professional with proven competence.
NEW YORK TIMES
-Where Was the Israeli Military on Oct. 7? A Times investigation found that troops were disorganized, relied on social media to choose targets and had no battle plan for a massive Hamas invasion.
-Displaced Gazans in the south face Israeli attacks they sought to escape. Many residents feel that no place is safe after an airstrike hit an area of southern Gaza where Israel had ordered people to seek shelter.
-How the Supreme Court May Rule on Donald Trump’s Presidential Run. The legal issues are novel and tangled, experts said, and the justices may be wary of knocking a leading presidential candidate off the ballot.
-Maine Law ‘required that i act’ to disqualify trump, secretary of state says. Barring former President Trump from the primary ballot was a hard but necessary call said Shenna Bellows, Maine’s secretary of state.
-How the Russian government silences wartime dissent. A law making it illegal to discredit Russia’s army has ensnared thousands of Russians for even mild acts or statements against the war.
-‘There’s no other job’: the colonial roots of Philippine poverty. Decades after independence, the Philippines lacks the kind of factory economy that has lifted up other Asian nations, tying millions to farm work.
-On the Philippine island of Mindanao, people in rural areas struggle to feed themselves in the same way as their ancestors.
-NYC officials reassure revelers ahead of New Year ’s Eve festivities. Protests and high tensions have been gripping the city, but officials said there were “no specific credible threats” related to the Times Square ball drop.
-The US is on track for a record drop in homicides, and many more crimes are in decline, according to the FBI
-A move by Mayor Eric Adams meant to slow the surge of new arrivals being sent to New York from Texas encountered logistical hurdles within 24 hours.
-Judge blocks Iowa’s ban on school library books that depict sex acts. Authors and activists said the Republican-backed law infringed on free speech. The judge said the ban imposed a “puritanical ‘pall of orthodoxy’ over school libraries.”
-Donald Trump’s former fixer Michael Cohen had sought an early end to court supervision after his 2018 campaign finance conviction. He enlisted the help of Google Bard.
-Ohio governor Mike DeWine (R) blocks bill banning transition care for minors. The governor vetoed the measure despite his party’s move to mobilize cultural conservatives around transgender issues.
NY POST
- California will offer free health care to all undocumented immigrants who qualify for its government-run Medi-Cal health insurance program, despite facing a $68 billion deficit. The state has expanded access to the program since 2015, covering undocumented children and adults aged 19-25 and over 50. The program will cover 700,000 undocumented immigrants.
-US prosecutors have decided against a second trial against Sam Bankman-Fried, who was convicted of stealing from FTX customers. The strong public interest in a prompt resolution outweighed the benefits of a second trial, as Bankman-Fried's scheduled March 2024 sentencing is expected to include forfeiture and restitution orders.