Category: Observation

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Scientists create ‘world’s purest silicon’ – it has the power to change the world

Purest silcon created

Scientists have recently achieved a remarkable breakthrough by creating pure silicon, which could pave the way for quantum computing

The world’s purest silicon

Researchers have developed an ultra-pure form of silicon, known as silicon-28 (Si-28), which is fundamental for ‘silicon-spin qubits’ in quantum computers. This advancement addresses a major challenge in quantum computing: the ‘fragile quantum coherence.’

Quantum computers tend to accumulate errors quickly due to slight environmental changes, affecting their dependability.

Quantum bits, or qubits, are analogous to classical computer bits but are extremely sensitive to environmental interference.

Technical

Current quantum computers, even when cooled to near absolute zero, can only maintain error-free operation for a very short time.

This new technique generates qubits by embedding phosphorus atoms into crystals of pure, stable silicon. A concentrated silicon beam then directs onto a silicon chip, replacing impurities with pure silicon.

As a result, the impurity levels in silicon have been significantly reduced, from 4.5% to a mere 0.0002%.

David Jamieson, a project co-supervisor from the University of Melbourne, mentioned that the team achieved this level of purity using a standard piece of equipment – an ion implanter – that’s typically found in semiconductor fabrication laboratories.

Richard Curry, a professor at The University of Manchester where extensive research took place, believes that this advancement could accelerate the development of operational quantum computers. Processes that might have taken a decade to complete could now be accomplished in potentially half that time or less.

Potential impact

Practical quantum computers have the potential to revolutionize numerous fields

  • Energy Optimization: They can solve intricate problems related to energy.
  • Artificial Intelligence: Quantum computers may significantly boost AI capabilities.
  • Drug Discovery: They could expedite drug development and molecular simulations.
  • Communication: They can enhance encryption and communication protocols.

The creation of the world’s purest silicon represents a significant step forward in the development of large-scale quantum computers.

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UK interest rate held at a 16-year high as Bank of England holds rates at 5.25%

On hold

The decision comes as inflation, which measures price rises over a period of time, remains above the Bank’s 2% target at 3.2%. But bank says cuts are coming.

Is the 2% target still a sensible benchmark?

The 2% inflation target set by central banks has been a widely adopted benchmark for monetary policy.

History

The 2% inflation target became prominent in the 1990s and early 2000s. Central banks, such as the Federal Reserve and the Bank of England, have aimed to maintain inflation at this level.

The Federal Reserve has typically pursued an inflation rate of about 2% since 1996.

In January 2012, then-Fed Chairman Ben Bernanke formally established the 2% target, and subsequent Fed chairs have continued to endorse this rate as the preferred level of inflation.

Why the 2% target?

Price stability

The 2% inflation target was selected as it provides a balance between preventing problematic inflation and avoiding damaging deflation. Does it work?

Avoiding deflation

Deflation, characterized by falling prices, can hinder economic growth. Central banks target a 2% inflation rate to avert deflation and ensure stability.

Creditor-Debtor compromise

The 2% inflation target represents a balance between creditors’ preference for lower inflation and debtors’ inclination towards higher inflation.

Challenges

Changing economic environment

In recent years, the global economy has encountered distinct challenges, including sluggish growth, technological upheavals, and demographic changes. Consequently, there is a debate on whether the 2% inflation target requires reassessment.

Persistently low inflation

Despite the efforts of central banks, inflation has persisted below the 2% mark in numerous advanced economies, sparking debates over the potential need to modify the target.

Trade-offs

Aiming for a 2% inflation rate can occasionally clash with other policy objectives, like employment or financial stability. It’s crucial for central banks to judiciously manage these competing priorities.

Revision

Several central banks are revising their strategies. For example, the European Central Bank (ECB) has adopted a more adaptable inflation target, permitting temporary exceedances to balance out extended periods of below-target inflation.

The Bank of England also considers broader economic factors when setting policy, rather than rigidly adhering to the 2% target.

IIn summary, although the 2% inflation target has been a helpful benchmark, central banks are progressively willing to adjust their strategies in response to evolving economic conditions. The current debate focuses on striking an optimal balance between stability, growth, and adaptability.

Central banks saw this period of inflation as ‘transitory’ – it wasn’t. It could be argued that their lack of action led to a bigger inflation problem overall.

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Why are mortgage rates still going up?

Home loans increasing

Mortgage rates are still going up due to expectations that the Bank of England might not cut borrowing costs as much as expected. 

Higher-than-expected inflation figures at this point, have led to increased forecasts for UK interest rates, prompting lenders to raise the cost of new mortgage deals.

Those considering purchasing their first home or relocating have probably been monitoring the recent rise in mortgage rates closely. In the past few weeks, numerous lenders have increased the interest rates on new fixed mortgage deals, thus making borrowing costlier. Existing homeowners planning to remortgage this year might have anticipated falling rates, not an upward trend.

So, what’s driving this trend?

Borrowing costs are increasing

Mortgage rates typically reflect the actions of the Bank of England, especially changes to its benchmark interest rates, commonly referred to as the base rate. An increase in the base rate makes borrowing costlier. Swap rates, which are essentially agreements to exchange interest rates between parties for a specified duration, have a considerable impact on fixed-rate mortgage agreements. Consequently, as lenders face higher borrowing costs, fixed-rate mortgages tend to increase. With several recent rises in the base rate, mortgage rates have escalated accordingly.

Lenders’ strategies

Lenders are exercising caution in managing their customer base. The recent increases in rates do not reflect a rapid cycle as observed in the previous two years. Rather, lenders are strategically adjusting their rates. Earlier in the year, a mini price war among lenders led to favorable interest rates for borrowers. Nonetheless, these rates have subsequently increased, with lenders adopting a more conservative approach to pricing. For instance, the average interest rate for a two-year fixed deal rose from 5.55% at the end of January to 5.93% more recently.

Lenders don’t want too many customers

Mortgage brokers emphasize that the recent changes do not signify a new cycle of rapidly increasing rates, such as those experienced over the past two years.

Current mortgage rates remain below the peak of last summer and are not escalating as sharply as they did following the mini-budget of 2022. Nevertheless, some borrowers were expecting rates to consistently decrease throughout the year.

Two more key factors have created the current bump in the road.

  • Firstly, the global economic outlook has not been as positive as many would have hoped. The U.S. central bank again said it would keep interest rates unchanged, because the rate of rising prices (inflation) had proved more persistent than expected.
  • Secondly, lenders tend to move in a pack. A mortgage provider wants to set its rates to be competitive, but not too low to be suddenly inundated with custom and unable to cope with the demand.

For home buyers and owners, the financial landscape has shifted slightly; obtaining a mortgage now is somewhat more costly than it was a year ago.

According to Rightmove, the average monthly mortgage payment for a typical first-time buyer’s property, based on a standard five-year fixed, 85% loan-to-value mortgage, has risen to £1,117 from £1,056 the previous year.

Those facing the end of their two-year or, especially, five-year mortgage deals may see their monthly payments increase by hundreds of pounds, as their previous rates could have been below 2%.

Expectations and inflation

Market expectations are crucial. The Bank of England’s Monetary Policy Committee (MPC) affects mortgage rates through its decisions. The MPC recently indicated that rate cuts would not occur as soon or as frequently as once anticipated, due to persistent inflation and other economic considerations. As a result, mortgage rates have been gradually increasing.

To summarize, the escalation in mortgage rates is attributed to several factors, including higher borrowing costs, the conservative tactics of lenders, and the anticipations of the market. It is crucial for prospective homebuyers and current homeowners to keep a vigilant eye on these trends to make well-informed decisions.

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IMF warns U.S. and China trade divisions threaten a ‘reversal’ for global economy

U.S. & China trade tensions

Tensions between Washington and Beijing have intensified, with the U.S. ramping up trade restrictions and sanctions on China due to national security concerns.

Since Ukraine’s invasion, there has been a roughly 12% drop in trade between the blocs, and foreign direct investments have decreased by 20% compared to those within the bloc’s constituents.

If these divisions persist, the IMF forecasts that the economic impact on global GDP could be as high as 7% in the worst-case scenario.

A senior International Monetary Fund official cautioned on Tuesday, 7th May 2024, that the rift between the U.S. led Western and China-aligned economic blocs endangers global trade cooperation and economic growth.

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Gold bars from vending machines – whatever next – coffee at Royal Mint?

Gold bars

Buy gold bars from South Korea’s convenience stores and vending machines

South Korean convenience stores are now the latest attraction for gold enthusiasts. Instead of the typical snacks and beverages, customers can now buy gold bars.

Convenience store gold bars

GS Retail, one of South Korea’s largest convenience store chains, introduced gold bars in vending machines at select locations in September 2023. These machines offer five different sizes, ranging from a tiny 0.13-ounce bar to a bigger 1.3-ounce bar.

The most sought-after option is the diminutive 0.13-ounce gold bar, with a price tag of approximately $225. It’s the younger demographic – individuals in their twenty’s and thirty’s – who are eagerly acquiring these lustrous assets. They possibly view gold as a secure refuge in the face of worldwide inflationary pressures and heightened global geopolitical tensions.

GS Retail has reported total sales of gold bars amounting to $19 million in the past nine months, concluding in May. The rising popularity of these bars has led the company to increase the number of stores offering them, aiming to reach 50 locations by the end of the year.

CU collaboration

In a competitive move, CU, the nation’s premier convenience store chain, has partnered with the Korea Minting and Security Printing Corporation (KOMSCO) to sell mini gold bars ranging from 0.1 to 1.87 grams. These diminutive bars have been on sale at CU stores since April.

The pricing of these mini gold bars is tied to fluctuating international gold prices, updated daily. Evidently, even these small quantities of gold are attracting keen interest from young consumers.

Accessibility and fun

The soaring popularity of gold bars in South Korea can be attributed to their accessibility. With convenience stores at every corner, purchasing gold has become as simple as walking in and making a selection.

A representative from Inha University reportedly noted that while some may purchase gold bars as a serious investment, others might buy them for the novelty and ease of access. Imagine the allure of picking up a gold bar along with your daily groceries.

To sum up, convenience stores in South Korea have become modern-day treasure chests, where gold bars are sold next to daily necessities. Whether for investment purposes or for a bit of indulgence, these shiny objects are creating a buzz in the country known for K-pop and kimchi.

So, next time you visit a Korean convenience store, don’t miss the chance to check out the shiny vending machine – it could present a golden opportunity.

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FTSE 100 in record territory

The FTSE 100 soared past 8300, reaching a new record high amid busy trading as London markets reopened after the bank holiday.

A catch-up trading session is evident, with mainland-listed stocks having a robust session on Monday 7th May 2024 and continuing to rise. The FTSE reached around 8335 in intraday trading.

Wall Street also experienced another positive session, with the Dow Jones climbing for the fourth consecutive day following the Federal Reserve’s less aggressive stance, and the S&P 500 gaining too. Despite mixed results, earnings have bolstered risk appetite. The low U.S. job count has encouraged traders/investors to take heart that rate cuts will be on the agenda again soon, even if they are now late.

Bank of England

Attention will now turn to the Bank of England (BoE), which faces a decision on whether to guide the market towards a rate cut – the first in four years – or to exercise more patience. The consensus is that it’s premature for a cut this week, with August 2024 being the more likely date, although the Monetary Policy Committee’s (MPC) opinions vary.

Last month the Deputy Governor of the BoE, indicated his readiness to vote for a rate cut with little additional evidence of declining inflation, highlighting the ‘downside risks’ to the BoE’s February inflation forecast. In contrast, the Bank of England’s Chief Economist, expressed a more cautious stance in April regarding the initiation of rate cuts.

Inflation

Inflation is on a downward trajectory, expected to return to 2% in the next few months. CPI decreased from 3.4% to 3.2% between February and March 2024, and core inflation dropped from 4.5% to 4.2%. However, the BoE is likely to await April’s data before taking any decision.

Persistent wage growth of around 6% indicates continued strength in the labour market. Financial markets anticipate a Bank of England rate cut by August 2024, but it is believed the BoE may be prepared to act as early as June 2024, aligning with the anticipated policy move by the ECB.

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Apple reportedly developing AI microchips for data centres

Apple

Apple, renowned for its innovative consumer electronics, is reported to be branching into artificial intelligence (AI).

Recent reports suggest the company is developing a project dubbed ‘Project ACDC,’ (Apple Chips in Data Centre) with the goal of creating specialized AI chips for data centres.

The AI race

AI applications are becoming ever more essential in our daily routines, prompting tech giants to vie for dominance in this arena. Apple, previously trailing behind its rivals in AI, is now channelling substantial investments to bridge the gap. Project ACDC marks Apple’s strategic endeavour to position itself as a key contender in AI processing.

The role of AI microchips

Traditionally, data centres have depended on general-purpose processors, like Intel Xeon or AMD EPYC, to manage diverse workloads. AI workloads, however, demand unique features such as extensive parallelism and high computational throughput. Specialized AI chips are crucial to meet these demands.

Apple’s AI chips, designed specifically for data centre servers, aim to efficiently expedite AI tasks. These chips will facilitate capabilities such as natural language processing, image recognition, and recommendation systems. With the development of its own AI chips, Apple seeks to secure a competitive edge in the AI technology race.

Collaborating with Taiwan Semiconductor Manufacturing Co.

Apple is said to be partnering with Taiwan Semiconductor Manufacturing Co. (TSMC) to design and produce AI chips. TSMC, a top semiconductor manufacturer, is recognized for its cutting-edge process technology. Although the release timeline for these chips is not specified, their development underscores Apple’s dedication to AI.

WWDC 2024 expectations

Rumors indicate that Apple may reveal AI-based features enabled by its new chips at the Worldwide Developers Conference (WWDC) in June 2024. Should this be accurate, it could mark a significant milestone for Apple’s AI initiatives.

In conclusion, Apple’s Project ACDC signifies an aggressive move towards AI supremacy. With ongoing investments in generative AI, we can anticipate significant advancements in the near future.

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UK Ministry of Defence suffers hack and data breach

The breach involved a third-party payroll system used by the MoD

The compromised system contained names and bank details of both current and past members of the UK armed forces.

While the full extent and consequences of the breach are still under investigation, preliminary results reportedly indicate that no data was extracted during the incident.

It appears that a minimal number of addresses might have been compromised.

The Ministry of Defence (MoD) responded quickly by disconnecting the external network, which is managed by a contractor.

Affected service members will be informed as a precautionary measure and will be provided with expert advice.

Hacker’s ID not revealed

The hacker’s identity has not been revealed, but it is significant that in March, the UK and the U.S. charged China with conducting a worldwide campaign of “malicious” cyber-attacks.

These assaults targeted the Electoral Commission watchdog in 2021 and involved online “reconnaissance” of MPs’ and peers’ email accounts. The limited response to these events highlights the persistent cybersecurity challenges and the importance of constant alertness.

As the inquiry progresses, the MoD is expected to implement additional security measures to safeguard sensitive data, measures that ideally should have already been established.

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UK predicted to have slowest growth of richest nations in 2025

Slow growth in UK

Forecasts indicate that the UK economy will experience sluggish growth among the largest developed nations in 2025.

The Organisation for Economic Co-operation and Development (OECD) has projected a 1% increase in the UK’s gross domestic product (GDP) for 2025, which lags behind the growth rates of other G7 nations, including Canada, France, Germany, Italy, Japan and the US.

The OECD, a globally recognised think tank, has described the UK’s economic outlook as ‘sluggish‘ for the current year. The organization attributes the lackluster performance to the cumulative effects of consecutive interest rate hikes in the UK.

Additionally, the OECD has cautioned that persistent elements of high inflation and the uncertainty surrounding the Bank of England’s interest rate decisions may deter investment.

The latest forecast for the UK economy predicts a 0.4% growth for this year, a revision downward from the OECD’s earlier estimate of 0.7% growth. Consequently, Germany is the only G7 country projected to have slower growth than the UK this year.

Year on year economic growth predictions for G7 nations from the OECD

Year on year economic growth predictions for G7 nations from the OECD
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World’s largest cargo ship docks in UK port

Largest cargo ship

The world’s joint-largest cargo ship, the MSC Loreto, recently docked at Britain’s biggest and busiest container port.

  • Ship Name: MSC Loreto
  • Sister Vessel: The MSC Loreto shares the title of the world’s largest cargo ship with its sister vessel, the MSC Irina.
  • Length: 400 metres (approximately 1,312 feet)
  • Gross Tonnage: More than 238,000 tonnes.
  • Container Capacity: Capable of holding 24,346 standard containers, which is currently the record number.
  • Port of Arrival: The MSC Loreto arrived at the Port of Felixstowe in Suffolk from Le Havre, France.
  • Operator: The vessel is operated by the Swiss-headquartered Mediterranean Shipping Company (MSC).
  • Next Destination: The ship is due to set sail for the Algerian capital of Algiers on the country’s Mediterranean coast.

Image 400 metres for just a moment – that’s 4 trips for Usain Bolt up and down 100 metre athletics track or, about 40 double decker buses parked end to end.

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Are U.S. banks at risk of failure?

Banks at risk?

The fragility of U.S. banks: A looming financial crisis or an event unlikely to unfold?

Amid escalating interest rates and economic instability, an alarming report has surfaced, suggesting that a considerable number of U.S. banks are on the verge of collapse. This potential looming crisis is attributed to various elements that have jeopardised stability.

Hundreds of small and regional banks across the U.S. are feeling stressed.

A recent publication on the Social Science Research Network indicates that up to 186 banks in the United States may be at risk of collapse or at least severe financial damage due to a significant amount of uninsured deposits and the effects of monetary tightening.

The Federal Reserve’s policy to raise interest rates has resulted in considerable asset reductions of these banks. The study emphasizes the susceptibility of banks that depend largely on uninsured depositors, who hold account balances above the FDIC‘s insurance limit of $250,000.

The precarious situation could worsen due to a potential domino effect. Should a substantial number of uninsured depositors suddenly withdraw their funds, it ‘might’ prompt a banking crisis, endangering even insured deposits. It is estimated that nearly $300 billion in insured deposits could be at risk in such an event. Remember the financial crises of 2008/2009 – it wasn’t that long ago.

Silicon Valley Bank

The collapse of Silicon Valley Bank, for example, highlights the risks associated with rising interest rates and significant withdrawals of uninsured deposits. The bank’s failure to fulfill its obligations resulted in its shutdown, which had an impact on the financial sector.

Although the number of FDIC insured institutions on the so-called ‘Problem Bank list‘ has decreased, the current economic climate has reignited concerns about the stability of smaller banks, particularly those with assets under $10 billion.

These banks face threats from commercial real estate loans and the repercussions of rising interest rates, which could lead to unrealised losses and strain their capital reserves.

As the situation unfolds, it becomes clear that without government intervention or strategic recapitalisation, the U.S. banking system could approach a crisis. This potential crisis could affect not only the banks but also the wider economy and the communities they serve.

Therefore, vigilant oversight and proactive measures are crucial to maintain the stability of the U.S. and the global financial system and protect depositors’ interests.

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Binance founder Changpeng Zhao sentenced to 4 months

Cryptocurrency trading

Changpeng Zhao (CZ), the founder of Binance, who admitted to money laundering offences in November 2023, received a four-month prison sentence on Tuesday 30th April 2024.

U.S. prosecutors had suggested a sentence of 36 months for Zhao. As part of his deal with the Justice Department, the cryptocurrency billionaire resigned from his position as CEO of Binance.

The billionaire is reportedly expected to see his massive crypto fortune remain intact. His wealth is likely to continue to climb even as he serves time in prison.

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BYD profits and sales fall

Electric vehicle

Chinese automotive giant BYD has experienced a decline in profits amid a slowdown in electric vehicle (EV) demand and a price war in the largest car market globally.

The company reported earnings of $630 million (£502 million) for the first quarter, a drop of over 47% from the previous quarter.

Competing with Elon Musk’s Tesla for the title of the world’s top EV seller, BYD recently fell behind as Tesla regained the lead earlier this month.

In the first quarter, BYD’s sales of battery-only vehicles fell to just over 300,000, a decrease from the last quarter of 2023’s record high of 526,000 units.

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WEF president warns about global debt levels

Global debt burden

Borge Brende, the president of the World Economic Forum (WEF), recently issued a stark warning about global debt levels.

Speaking at the ‘Special Meeting on Global Collaboration, Growth and Energy for Development‘ in Riyadh, Saudi Arabia, (see WEF website), he highlighted that global debt ratios are approaching levels not seen since the 1820s.

The WEF president also reportedly emphasized the risk of ‘stagflation‘ for advanced economies. He cautioned that without appropriate economic measures, the world could face a decade of low growth.

The current global growth estimate stands at around 3.2%, down from the 4% trend growth seen for decades. Brende urged governments to address the mounting debt situation and implement prudent fiscal measures to avoid triggering a global recession. 

He also noted the persistence of inflationary pressures and suggested that generative artificial intelligence could offer opportunities for developing nations. The International Monetary Fund (IMF) concurs with this concern, reporting that global public debt reached 93% of GDP last year, still 9% higher than pre-pandemic levels. 

The IMF projects that global public debt could approach 100% of GDP by the end of the decade.

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Darktrace has been sold to a private equity firm

Deal

Private equity firm Thoma Bravo has agreed to acquire Darktrace in a $5.32 billion (£4.25 billion) cash acquisition.

This translates to roughly $7.75 (£6.20) per share, which is a 44% premium over the company’s average share price as calculated over the last three months.

Darktrace, headquartered in Cambridge, focuses on cybersecurity, employing self-learning AI to counteract and automate reactions to cyber threats via its Darktrace ActiveAI Security Platform. The company caters to approximately 9,400 clients globally.

Thoma Bravo’s acquisition of Darktrace adds to its cybersecurity portfolio, which is currently estimated at around $45 billion in value. 

The loss of Darktrace from the London Stock Exchange (LSE) was described as ‘disappointing news.’ There have been calls for greater pro-business reforms to help maintain London’s attractiveness for technology companies.

Darktrace was established in 2013 by Invoke Capital, an investment firm led by Autonomy’s founder Mike Lynch. He now holds a 3.9% stake in Darktrace, positioning him to gain just over $200 million from its sale. His wife holds an additional 2.9%.

Concurrently, Lynch is entangled in a fraud trial in San Francisco. He is reportedly facing accusations of being the ‘driving force’ behind significant fraud at Autonomy.

Autonomy was the software company he co-founded and eventually sold to Hewlett-Packard for $11 billion (£8.6bn) in 2011.

The acquisition represents a significant development in the cybersecurity industry.

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Recent U.S. data is indicating inflation is proving stubborn and isn’t going away anytime soon

Inflation has become a persistent challenge for the Fed

The battle against inflation persists, gradually impacting the U.S. economy and presenting substantial challenges for the Federal Reserve.

Despite concerted efforts to control it, inflation remains stubbornly remains, leaving policymakers in a dilemma – to stimulate economic growth or to curb spiraling prices.

Let the data speak

Recent data presents a concerning scenario. Indexes from the Commerce Department, used by the Federal Reserve as indicators of inflation, reveal that prices are rising at a rate significantly exceeding the central bank’s annual target of 2%. Consumer spending persists, encouraged by the excessive amount of money circulating in the financial system.

However, this spending spree isn’t sustainable, and consumers are dipping into their savings to fund purchases. The personal savings rate has plummeted to its lowest level since October 2022. Borrowing is up and debt is far too high!

The Federal Reserve’s primary inflation gauge, the personal consumption expenditures price index, rose to 2.7% in March, encompassing all items. The crucial core index, excluding the more volatile food and energy prices, remained constant at 2.8%. These figures highlight the ongoing inflationary pressures.

Fed’s dilemma

The Federal Reserve is navigating a precarious inflation situation. Should it shift towards rate reductions prematurely, there’s a risk that inflation might surge back in 2024. Conversely, persistent inflation could compel central bankers to not only sustain the present rates but also ponder additional increases. The aspiration for a gentle economic descent is at stake.

Outlook

Forecasters anticipate inflation to dip below 2.5% in 2024, yet challenges persist. The Federal Reserve faces the difficult task of steering the economy towards stability and controlling inflation expectations. With the central bank’s policy meeting on the horizon, speculation abounds regarding their forthcoming strategy.

Will they maintain the current interest rates or implement more assertive measures? Their decision is set to influence the economic outlook for the foreseeable future.

Conclusion

U.S. inflation continues to be a persistent challenge, and the Federal Reserve’s efforts are ongoing. The path forward demands cautious steering, as policymakers must achieve a fine equilibrium to sustain economic stability while simultaneously curbing inflation.

And remember, the Fed said inflation was ‘transitory’.

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Synthesia creates AI avatars that can convey human emotions

Avatar

AI startup Synthesia on Thursday 25th April 2024 announced its ‘Expressive Avatars’. These are AI-generated digital avatars that can express human emotions including happiness, sadness, and frustration.

Synthesia, supported by the tech giant Nvidia, reportedly secured an investment of $90 million in 2023, reaching a valuation close to $1 billion.

This video was created using the Synthesia platform, it took just two minutes to create.

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AI energy consumption is shocking!

AI Energy Consumption

Powering artificial intelligence (AI) models takes a substantial toll on our planet’s energy resources.

Delving deeper into AI, it becomes crucial to comprehend the environmental impact of this technological revolution.

Current trends

A new peer-reviewed study featured in ‘Joule‘ highlights the significant energy requirements of AI. The research, carried out by Alex de Vries, a data scientist at the Dutch central bank, provides a quantification of the energy usage linked to the trends in AI capacity and adoption.

The energy appetite of AI

The AI industry is experiencing rapid growth as major technology companies incorporate AI-driven services into their platforms. These applications require significantly more power than traditional ones, resulting in online interactions that are more energy-intensive.

Projected impact

Continuing on the present course, NVIDIA could be dispatching 1.5 million AI server units each year by 2027. If these servers were to run at maximum capacity, they would consume a minimum of 85.4 terawatt-hours of electricity annually. For comparison, this amount of energy surpasses the yearly consumption of numerous small nations.

Comparisons

By 2027, it is projected that global AI-related electricity consumption may rise by 85 to 134 terawatt-hours (TWh) annually. This estimate is on par with the yearly electricity requirements of nations such as the Netherlands, Argentina, and Sweden.

Why sustainability matters

While AI heralds significant breakthroughs, its sustainability is a crucial risk factor to consider. Picture Google’s search engine evolving into a ChatGPT-style chatbot, managing nine billion interactions daily. This would cause energy demands to soar, matching the consumption of a nation like Ireland. Although this scenario isn’t immediately likely due to logistical limitations, it highlights the resource-intensive nature of generative AI applications.

As we explore the AI domain, sustainability should not be neglected. Discussing AI’s risks, such as errors and biases, should also include its environmental impact. Innovation must be balanced with responsible energy use for a sustainable future.

Conclusion

In essence, AI’s demand for power is substantial, and the challenge is to leverage its capabilities while reducing its environmental impact. We must proceed with caution to ensure our technological advances do not compromise the health of our planet.

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Voyager One phones home for the first time in 5 months

Voyager One

Voyager 1, launched in September 1977, holds the distinction of being the furthest human-made object from Earth.

It embarked on an incredible journey, venturing beyond the boundaries of our solar system and into interstellar space.

Here’s the latest update on this iconic spacecraft

Communication

On 14th November 2023, Voyager 1 experienced an unexpected glitch, rendering its binary communication code with NASA’s flight team incomprehensible.

However, after several months of indecipherable signals, Voyager 1 has resumed clear communication with Earth. On 20th April2024, the spacecraft reported back to its NASA team, detailing its health status for the first time in five months.

Although it is not yet transmitting scientific data, Voyager 1 is providing valuable information regarding the health and functionality of its onboard engineering systems.

Historic

Thirty-five years post-launch, Voyager 1 marked a milestone as the first human-made object to exit the solar system and enter interstellar space.

Six years thereafter, in 2018, Voyager 2 emulated its predecessor, venturing beyond the sun’s dominion. Together, these spacecraft stand as humanity’s lone envoys in the cosmic expanse, bearing our scientific endeavours and inquisitive spirit.

Technical repair

In March, the team operating NASA’s Voyager 1 sent a command to the spacecraft, which triggered its flight data subsystem (FDS) to transmit a complete memory readout to Earth.

The analysis of the memory dump reportedly indicated that the malfunction was due to a piece of corrupted code on a single chip, accounting for approximately 3% of the FDS’s memory.

While it’s not possible to physically repair or replace the chip, the team is adeptly shifting the problematic code within the FDS’s memory. This process apparently involves dividing the code into segments and reallocating them to different storage areas, with the goal of maintaining the smooth operation of Voyager 1’s systems.

Clever

Ultimately, Voyager 1’s recent successful communication serves as a remarkable example of human creativity and determination in space exploration. Even from its extraordinary distance from Earth, the venerable spacecraft continues to provide important updates on its status and insights into the unknowns of interstellar space.

15 billion miles and counting

Voyager 1 is approximately 15 billion miles from home. It takes about 1 day for information to travel from Voyager to Earth. Voyager 1 is travelling at an estimated speed of: 38026

Voyage One mission status

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Will Bitcoin experience another growth spurt after the latest halving event?

Bitcoin halving is a significant event in the cryptocurrency world

What is Bitcoin Halving?

Bitcoin halving, which happens roughly every four years, cuts the rate of new Bitcoin creation by half. This event is tied to the method of recording and generating Bitcoins. Transactions are logged on a blockchain, a ledger accessible to all.

Miners compile transactions into blocks and connect them by resolving cryptographic challenges, earning new bitcoins as their reward.

Satoshi Nakamoto, the enigmatic creator of Bitcoin, designed the cryptocurrency to have a maximum circulation of 21 million coins. To ensure this, the Bitcoin protocol halves the reward given to miners every 210,000 blocks, an event that occurs approximately every four years.

The Latest Halving

The latest Bitcoin halving took place in the early hours of Saturday 20th April 2024, reducing the reward for adding a new block of transactions to the blockchain from 6.25 Bitcoins to 3.125. Bitcoin’s halving will persist until the total supply approaches the 21 million cap, anticipated around the year 2140.

Impact on Bitcoin Price

The halving of Bitcoin reduces the number of new coins entering circulation, which, in theory, could drive up the price if demand remains constant.

According to economic principles, a stable demand coupled with a reduced supply should lead to a price increase.

Analysis of the three previous halvings (in 2012, 2016, and 2020) indicates an average price surge of 16% in the 60 days post-halving.

Typically, investors see the highest price increase approximately 500 days following a halving event.

Despite a recent drop from its peak, Bitcoin holds a high-level interest for crypto investors, even with its volatile behaviour. It has posted a 40% increase in 2024 compared to the same period last year.

In summary, the halving of Bitcoin reduces the availability of new coins, which could lead to an increase in value. However, the complete effects may only become apparent gradually over time.

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Global police forces take down massive scam website that defrauded thousands of victims

Online fraud

UK police have dismantled a gang that provided a technology service enabling criminals to use fraudulent text messages to defraud victims

Britain’s Metropolitan Police announced on Thursday 18th April 2024 that the ‘LabHost‘ website had been utilised by 2,000 criminals to pilfer personal details from users.

The police have reportedly identified approximately 70,000 UK individuals whose details were compromised via LabHost’s websites. The websites of LabHost have been disrupted and now displays a notice indicating that the services have been seized by law enforcement.

They have arrested 37 people worldwide and are contacting victims affected by the scam.

Phishing scam

Officers say younger people who grew up with the internet were the most likely to fall for the ‘phishing’ scam.

What is ‘phishing’

‘Phishing’ is a type of social engineering attack where perpetrators trick individuals into disclosing sensitive information or downloading malware. This often entails the use of deceptive emails or messages that mimic reputable entities, luring users to input their login details on counterfeit websites.

See Wikipedia definition.

The technology enabled scammers without technical expertise to inundate victims with deceptive messages aimed at eliciting online payments.

Authorities focused on the gang’s website, LabHost, which facilitated the despatch of these messages and steered victims towards counterfeit websites. These sites mimicked authentic online payment or shopping platforms.

ID theft

This operation allowed the perpetrators to pilfer personal identity details, including 480,000 card numbers and 64,000 PIN codes. It was referred to as ‘fullz data‘ in criminal circles, according to the police.

The exact amount of money stolen remains unknown. However, detectives estimate that the LabHost site generated close to £1 million ($1.25 million) in profits.

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Meta’s new AI Chatbot has arrived

Meta announces new Chatbot assistant

Meta’s complimentary artificial intelligence (AI) assistant, known as Meta AI, is being introduced across its social media platforms, including WhatsApp, Instagram, Facebook, and Messenger.

The assistant is reportedly designed to respond to queries, craft animations, and produce ‘high-quality’ images, according to Meta CEO Mark Zuckerberg in a recent video posting.

Zuckerberg also noted that the company has integrated ‘real-time knowledge’ from Google and Microsoft’s Bing to enhance the assistant’s responses.

The development of Meta AI is based on the company’s most advanced large language model, Meta Llama 3, which was unveiled on the same day – Thursday 18th April 2024.

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Crypto trading ‘concentration’ apparently raises alarm for EU watchdog

Crypto

Digital assets have soared recently to unprecedented heights and then plummet just as quickly. It’s an extremely volatile financial environment.

Amid this volatility, the European Union’s securities watchdog, the European Securities and Markets Authority (ESMA), has sounded a cautionary note.

The Concentration Conundrum

ESMA’s latest report highlights a considerable concern: the high level of concentration in crypto trading. A handful of exchanges, led by Binance, dominate the market. In fact, Binance alone accounts for more than half of all crypto trading activity. While this concentration might seem advantageous from an efficiency standpoint—thanks to economies of scale—it raises significant questions.

The Ripple Effect

Imagine a scenario: Binance, Coinbase or any crypto platform for that matter experiences a catastrophic failure or malfunction. The repercussions would reverberate far beyond its platform.

The entire crypto ecosystem would feel the impact. Investors, traders, and enthusiasts would face disruptions, financial losses, and uncertainty. The interconnectedness of the crypto world amplifies the stakes.

Risk and Resilience

ESMA’s concerns centre on systemic risk. When a single entity dominates a market, vulnerabilities emerge. What if Binance falters due to technical glitches, cyberattacks, or regulatory crackdowns? The fallout could destabilise other exchanges, trigger panic selling, and erode investor confidence. The crypto market, already prone to wild swings, would face heightened turbulence.

Mitigating Measures

ESMA’s report underscores the need for vigilance. Regulatory bodies must strike a delicate balance: promoting innovation while safeguarding stability. Diversification across exchanges, robust risk management practices, and stress testing are essential. Additionally, fostering competition and encouraging new players can dilute concentration risk.

The Way Forward

Crypto enthusiasts should heed ESMA’s warning. While the allure of rapid gains remains strong, prudent risk assessment is crucial. Investors must diversify their holdings, stay informed, and choose exchanges wisely. As the crypto landscape evolves, collaboration between regulators, industry players, and investors will shape its future.

In this high-stakes game, the EU watchdog’s message is clear: Tread carefully as you navigate the digital frontier.

Disclaimer: This article is for informational purposes only and does not constitute financial advice. Readers are encouraged to conduct their own research and consult professionals before making investment decisions

Remember to always do your own careful research or employ regulated financial advice.

Research! Research! Research!

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IMF says Russia is expected to grow faster than all advanced economies in 2024

Oil

The International Monetary Fund calculates that Russia’s economy will expand more rapidly than all advanced economies this year.

According to the latest World Economic Outlook released by the IMF, Russia’s economy is projected to expand by 3.2% in 2024.

This growth outpaces the anticipated growth rates for the U.S. at 2.7%, the U.K. at 0.5%, Germany at 0.2%, and France at 0.7%.

G7 growth percentages

  • Russia at 3.2%
  • U.S. at 2.7%
  • France at 0.7%
  • U.K. at 0.5%
  • Germany at 0.2%

The forecast may be galling for Western countries that have endeavoured to economically isolate, restrict and punish Russia for its invasion of Ukraine in 2022.

Russia has demonstrated that Western sanctions on its industries have made it more self-sufficient and that private consumption and domestic investment remain resilient.

Oil exports

Oil and commodity exports to nations such as India and China, (two of the largest countries in the world by population) – as well as alleged sanction evasion and high oil prices, have allowed Russia to maintain strong oil export incomes streams.

UK and Europe growth

Outside of Russia, the IMF has revised its forecasts for Europe and the UK, projecting a growth of 0.5% for this year. This positions the UK as the second-lowest performer within the G7 group of advanced economies, trailing behind Germany.

The G7 also includes France, Italy, Japan, Canada and the U.S.

However, UK growth is expected to improve to 1.5% in 2025, placing the UK in the top three best G7 performers, according to the IMF.

The IMF also reported said that interest rates in the UK will remain higher than other advanced nations, close to 4% until 2029.

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Bank of England school report: must try harder – a brutal analysis of ‘out of date’ systems

Bank of England forecasts

The Bank of England (BoE) stands as a bastion of economic stability, guiding the United Kingdom through the ebbs and flows of financial tides. 

Modernising the Bank of England’s forecasting system has become a critical necessity. A recent independent review has cast a spotlight on the ‘serious deficiencies’ within its economic forecasting system, calling for an urgent modernisation.

Out of date forecasting methods

What have they all been doing for all these years to not have updated their systems?

The review, led by Dr. Ben Bernanke, a former chair of the U.S. Federal Reserve, paints a picture of an institution grappling with outdated systems and under-investment in critical infrastructure. The Bank’s staff, the report suggests, are hindered by software that is not just out-of-date but also complicates the already intricate task of economic forecasting.

This revelation comes at a time when accurate economic forecasting is more vital than ever. The world is still reeling from the effects of the pandemic, the 2008/2009 financial crisis and the UK faces unique challenges post-Brexit. The Bank’s ability to predict economic trends accurately is paramount in crafting policies that safeguard the nation’s financial health.

Deficiencies

The deficiencies highlighted are not just a matter of outdated software; they reflect a deeper need for a paradigm shift in how economic data is handled and analysed. The report recommends a complete overhaul of the system, emphasizing the need for automation of tasks that are currently performed manually.

Governor Andrew Bailey’s reportedly responded to the review by acknowledging the gravity of the situation, stating that updating the Bank’s systems is a ‘high priority’. This commitment to modernisation is a step in the right direction, but it should be followed by swift and decisive action, surely.

A broken compass?

The Bank of England’s forecasting system is more than a tool; it is the compass by which the nation navigates its economic future. Modernising this system is not just a recommendation; it is an imperative. As the UK charts its course in a rapidly changing global economy, the reliability and sophistication of its economic forecasting are not just beneficial but essential for continued prosperity.

In conclusion, the Bank of England’s economic forecasting system is at a crossroads. The call to modernise is clear, and the path forward must be paved with innovation, investment, and a steadfast commitment to excellence in economic stewardship.

The future of the UK’s economy depends on it.

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Does extreme flooding pose a threat to UK food security?

UK floods

Record-breaking rain has inundated the United Kingdom over the past few months, leaving fields submerged and livestock at risk.

The relentless downpours, likely exacerbated by climate change, are now threatening the very foundation of UK food production.

Challenges faced by farmers

UK farmers are facing the repercussions of extreme weather events. Fields that would normally be abundant with crops are currently waterlogged, making them barren. Livestock are also suffering, unable to graze in the inundated fields, leading to a shortage of feed. The circumstances are critical, prompting the National Farmers Union (NFU) to raise the alarm.

NFU’s concerns and calls for action

The NFU emphasizes that climate change-induced flooding imperils food security. Rachel Hallos, NFU vice president, warns that these extreme conditions could become the norm. Urgent action is needed to safeguard our agricultural systems.

  • Compensation and Support: The NFU urges the government to provide more substantial compensation to flooded farmers. The recently launched Farm Recovery Fund offers grants, but broader and longer-term assistance is essential.
  • Reduced Crop Output: Weeks of incessant rain have already impacted this year’s harvest. Crop quality may suffer, affecting both farmers and consumers.
  • Resilience and Adaptation: We cannot rely solely on imports. A clear government plan is necessary to prepare for the potential effect of extreme weather, adapt to its effects, and ensure continued food production.

Voices from the fields – case study example

A recent report from a mixed dairy, beef, and arable farmer in Gloucester whose land lies in the floodplain reportedly said that floods occurred every six years, but now they occur with alarming frequency. Cattle, unable to graze, face dwindling feed supplies. Livelihoods hang in the balance.

The farmer went on to say, ‘climate change affects us all. It threatens our food supply and prices. We must think about resilience and feeding the world amidst a changing climate.’

Conclusion

Extreme flooding transcends a natural disaster; it poses a threat to our very sustenance. In the face of such challenges in the UK, it is imperative that farmers, policymakers, and communities collaborate.

Prompt action is essential to safeguard our food security and foster resilience for the future.

Building and farming on low-lying land, often on floodplains, is likely a big part of the problem, along with the potential effects of the ever-changing climate and weather patterns.

Safety valve

Low lying land has always flooded – isn’t it natures safety valve? We cohabit with nature and low-lying land, as good as it is for farming (and building), will always flood – as it has for thousands of years.

But we do need to do more to protect our food production in the UK.