#176 - Car Market Is Crashing, New Bull Market Is Beginning and The World Is Headed Into Recession
Canadian Dependence On America
Inflation Reduction Act
Car Market is f’d
Real reason USA is supporting Ukraine
Chat GPT and it’s impact on the 4 largest companies on earth
Recommendations and Predictions
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Canadian Equities rallied along with the rest of the world on Friday and closed near highs. This rally was lead by financials and Energy. (+1.55%)
US equities rallied on Friday after the jobs report showed wages grew slower than expected. Large caps and small caps advanced: S&P 500 (+2.28%) vs. Russell 2000 (+2.26%).
Materials (+3.44%) and technology (+2.99%) bested the broader market indices, while health care (+0.89%) and energy (+1.68%) lagged. Intel (+4.25%) and Walgreens (+4.04%) led the Dow (+2.13%) higher; UnitedHealth (+0.01%) and Home Depot (+0.65%) were the index's worst performers.
The Nasdaq gained 2.56%, while the "FAAMG" stocks rallied: Meta (+2.43%), Amazon (+3.56%), Apple (+3.68%), Microsoft (+1.18%), Alphabet (+1.60%).
The VIX dropped 5.92% to 21.13. The 30-year and 10-year Treasury yields declined to 3.684% and 3.560% respectively, while the 2-year yield fell to 4.258%.
2023 is off to a good, if strange, start. China’s reopening is clearly the key driver, lifting Chinese/EM equities (+10.0/+5.7 pct). Oil prices are lower (WTI -8.1 pct) despite this development, helping EAFE outperform US stocks (+3.8/+1.4 pct). US bonds are outperforming domestic stocks by a wide margin (AGG +2.2 pct).
The new year is already very different than 2022.
The difference between 2-/10-year Treasury yields has turned more negative since the start of the year, suggesting incremental recession/shock risk.
Q4 earnings season starts this week, and analysts have been cutting estimates by more than usual. Even though US economic growth remains good, S&P earnings will likely be close to flat in Q4 and for the next 3 quarters. This is the usual recipe for corporate cost cutting/layoffs, and we expect to hear more such announcements in the weeks ahead.
Friday’s US Jobs Report reignited hopes that the Fed is nearly done raising rates. Futures now expect two sequential 25 bp increases in February/March and then a long pause.
We have some important events as earnings season begins:
Powell Speaks, CPI Data etc.
CES 2023 Recap: The Most Influential Tech Event in the World
Top 8 Ideas from CES 23:
1. Sony said its partnering with Honda on a new EV brand called Afeela. Here are some details from Mashable:
“The Afeela has an actual display built into the front bumper, which can be used to provide information to passing cars and pedestrians.”
“The Sony and Honda EV will also have an entertainment console built into the car offering various Sony movies, music, and gaming titles.”
“The Afeela will have a whopping 45 cameras and sensors both inside and outside the vehicle.”
Sony will start taking orders in 2025 and begin shipment in Spring 2026.
2. Mercedes said it plans to build its own global network of electric vehicle chargers, a feat only tackled by few car companies such as Tesla. Here are the details from the Wall Street Journal:
“It intends to install roughly 10,000 high-power EV chargers worldwide, starting in the U.S. and Canada this year.”
“The Mercedes-Benz-branded network would allow the car company’s own customers to pre-book a charging space from their car, but it will also be open to drivers of rival brands with compatible technology.”
“Mercedes-Benz says the build out in North America is projected to cost about $1.05 billion, a figure that will be split with its partner on the project, MN8 Energy, a U.S.-based renewable energy and battery-storage operator.”
Mercedes hopes to have 2,500 EV chargers available at 400 hubs in North America by 2027.
3. Asus showed off an OLED screen that generates a 3D experience from a laptop without glasses. Here are the details from CNET:
“It says OLED's high contrast and fast pixel response time promise less crosstalk and ghosting -- in other words, visibly crisper 3D rendering -- than with the IPS panels used by Acer.”
“The panel itself is the 3.2K 120Hz model Asus has been using in some of its current models, but the 3D is generated via a layer of lenticular lenses bonded to it -- to refract the emitted light to different eyes -- and Acer combines it with eye tracking to figure out how to orient the object.”
4. LG Electronics debuted a 97-inch OLED TV without any wires connecting it to media sources. CNET’s first take:
“Across the room from the TV sat the wireless transmitter box. On the back of the box were standard HDMI plugs and a handful of other connections, and one HDMI cable ran to a Blu-ray player. The image on the screen was from a Blu-ray disc, sent wirelessly -- and flawlessly, to my eye -- from the box to the TV. The top of the box can be rotated to aim an internal antenna at the television.”
“LG says the box can be located up to 30 feet from the TV.”
5. Ottonomy announced a new delivery robot with an auto dispense mechanism, eliminating the “need for a person to be present to receive the package,” according to TechCrunch.
“The startup calls the product “the first fully autonomous unattended delivery robot on the market”.”
“Once it reaches its destination, the last-mile-delivery bot can drop its contents onto a doorstep or transfer them into a compatible locker for safe keeping until the human arrives to pick them up.”
“Another interesting angle here is the potential for product returns — specifically, a customer could put the robot to use to get unwanted product back to the original seller.”
6. Holoride – backed by Audi – revealed a new device that can make any car ready for VR, allowing passengers to play video games, watch TV or scroll through social media platforms.
“Holoride retrofit works similar to its existing technology. The product connects to a VR headset via Bluetooth.”
“Holoride’s software taps into a vehicle’s movement and location data. The virtual reality content syncs with a vehicle’s movements in real time to prevent motion sickness.”
7. BMW unveiled new car technology, including an AI-powered virtual assistant and full-windshield heads-up display, such as changing the car’s colors.
The company’s i Vision Dee electric sports sedan concept “also included a full-color version of the E Ink technology seen on last year’s concept for the first time ever… Instead of just black, white, and gray, 32 colors are now available. Not only that but the i Vision Dee is made up of 240 E Ink e-paper segments, all of which can be controlled individually.”
“What’s more, this concept uses the latest tech from E Ink, called Prism 3 film, which is fully programmable and meant to be low on power consumption for sustainability. Prism 3 can also be manufactured in any shape, making industrial design applications seemingly endless.”
8.The Hollywood Reporter had a review of a SAG-AFTRA sponsored panel discussion on how artificial intelligence could change the entertainment industry.
One panelist opined that 90 percent of content may be, at least in part, AI generated by 2025. Another, the chief metaverse officer at talent agency CAA, highlighted her firm’s investment in AI-powered video production. Other speakers discussed technology which can create natural-looking lip-synced versions of movies in multiple languages and also “de-age” actors.
Comment: Disruptive technology has already fundamentally changed content distribution, so it makes sense that the next chapter is a more aggressive push into content creation. In theory, this has the potential to dramatically improve profitability across a variety of vectors (i.e., non-human AI actors, writers and production staff should be cheaper). The catch is that the product must still be appealing to a large audience. We are reminded of the old William Goldman quote that, in Hollywood, “no one knows anything” about what sorts of content will prove popular. Perhaps AI can do better … Or at least no worse …
💸Reformed Millennials - Post of The Week
Everyone’s using ChatGPT. And it's almost as though we now have a free virtual research assistant.
Rob Lennon on twitter had a great thread that i tried out myself. His course is attached
10 TECHNIQUES TO USING CHATGPT TO GET AHEAD WITH AI:
Simulate an expert
Ask ChatGPT to play the part of a customer, co-host, or talented expert.
Have a conversation with it, or ask it to generate content as if it were that specific persona.
You are a talented analyst at a top-tier market research firm, a graduate of Harvard Business School. Coach me to create content that connects with C-level executives at B2B SaaS companies. What open-ended questions do I ask? Prioritize uncommon, expert advice.
Challenge the conventional narrative
Ask for examples of what contradicts the dominant narrative.
Generate content that challenges readers' assumptions.
Seek out provocative angles that defy expectations and break the mold.
Topic: Growing your email newsletter
For the above topic, give examples that contradict the dominant narrative. Generate an outline for thought-provoking content that challenges assumptions.
Use unconventional prompts
Try using prompts that are more open-ended or abstract.
This way you’ll get unique and creative responses nobody else is.
By getting weird, you can unlock ChatGPT's creative potential in finding vivid language and unexpected topics.
Write a poem about copywriting.
Describe feeling like an entrepreneur in 10 adjectives.
It’s easy to have ChatGPT generate a list of potential topic ideas for your next project.
But often they're generic and expected.
Instead, ask it to come up with new angles or approaches to cover a familiar topic.
Topic: How to double your creative output.
For the topic above, brainstorm new angles or approaches. Prioritize ideas that are uncommon or novel.
Capture your writing style
Feed ChatGPT your writing.
Ask it to help you create a style guide for future outputs.
It’ll give you the exact words to describe your voice and tone in a way that AIs understand.
Analyze the text below for style, voice, and tone. Using NLP, create a prompt to write a new article in the same style, voice, and tone:
(Insert your text here)
Add in human-written techniques
Ask ChatGPT it to work according to good advice you've read elsewhere.
In the prompt below, I take some tips on persuasive writing from the Grammarly blog and ask it to apply them to my topic.
Write a brief post about why copywriting is an essential skill in 2023.
Use these strategies:
Use strong persuasive language
Ask questions to transition between paragraphs
Back up main points with evidence and examples
Speak directly to the reader
Have ChatGPT write from different perspectives
Ask it to write from the perspective of a group of characters with different backgrounds or viewpoints.
Explore new ideas and perspectives, and add depth to your writing.
Topic: Productivity for entrepreneurs
For the above topic, write multiple perspectives from a group with different viewpoints. For each perspective, write in their own voice, using phrases that person would use.
Write in different styles or tones, such as satire or irony
Takeaway: By experimenting with different voices and perspectives, you can use ChatGPT to create more dynamic and varied content.
Give the most ironic, satirical advice you can about using ChatGPT to create more effective content.
Use ChatGPT to write in different formats
Ask ChatGPT to vary its output.
Outline • Mind map • Bullet points • Persuasive essay • Chunks of text of less than 280 characters • Using the structure: 1) What, 2) Why, 3) How
Create a mind map on the topic of using Notion to stay organized as a content creator, listing out the central idea, main branches, and sub-branches.
Generate content with a specific purpose or goal in mind
Tell ChatGPT who your audience is and what you want to achieve with your content.
Remember, it has no context about who you are or what you want unless you give it some.
So give it context.
Topic: How to grow your coaching business For audience: Business coaches Content goal: Motivate audience to feel excited about growing their business while teaching them one tip. Writing style: Clear, concise, conversational, down-to-earth, humble, experienced
Get creative with ChatGPT: • The more you experiment, the more you'll discover • Try out new and unconventional ideas • Seek out new ways to find interesting and unique content angles
🎙Podcast & YouTube Recommendations🎙
Peter Zeihan Goes on Joe Rogan and talks Geopolitics and his book, the end of the world is just the beginning.
The First Month of Reopening; Xi’s Credibility; Qin Gang and US-China Relations - Sharp China
Tim Dillon Has Joe Rogan on His Show on Joe’s Set
Money fame and conspiracy with a LOT of edge.
🔮Best Links of The Week🔮
"Avatar: The Way of Water has grossed more than $1.7bn at the global box office, giving a boost to Disney as some Wall Street analysts are warning that its famed blockbuster engine has started to run out of steam. The movie’s haul at the weekend makes The Way of Water the seventh-highest grossing film of all time, ahead of Jurassic World. The original Avatar, released in 2009, remains the top moneymaker in cinema history with $2.9bn in total grosses." Source: FT
"EY is setting aside $2.5bn to fund an acquisition spree for its consulting arm following its planned separation from the Big Four firm’s audit business, as it presses ahead with preparations for the historic split. The war chest will allow the new company, which EY is aiming to float in New York, to double the pace of dealmaking as it battles to win market share from its Big Four rivals and standalone consulting firms, according to people familiar with the plan." Source: FT
The Messari Crypto Theses for 2023 - Investment memo will take 2-3 hrs to get through. The mammoth annual report on the crypto industry from Ryan Selkis, covering the key trends, people, and projects to keep an eye on in 2023. - Messari.io
Age and the Nature of Innovation - New ideas vs deep expertise; conceptual vs experimental innovation. Source: Matt Clancy