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Energy hungry data centre power solution

AI data centre

The use of nuclear reactors for data centres is a controversial and complex topic that has both advantages and disadvantages

Nuclear reactors can provide a reliable, stable, and carbon-free source of electricity for power-hungry data centres, which are essential for the operation of various applications, such as artificial intelligence (AI).

Grid overload

Nuclear reactors can also reduce the dependence on the existing grid, which may be vulnerable to blackouts, fluctuations, or cyberattacks. On the other hand, nuclear reactors require a high initial investment, as well as strict safety and regulatory standards. Nuclear reactors also pose potential risks of radiation, waste disposal, and proliferation. Moreover, nuclear reactors may not be suitable for all locations, as they may face public opposition, environmental concerns, or geopolitical issues.

Small Modular Reactor (SMR)

One of the possible solutions to these challenges is to use small modular reactors (SMRs), which are advanced reactors with about a third of the power generation of a traditional, large nuclear plant. SMRs are designed to be more flexible, scalable, and cost-effective than conventional reactors, as they can be built off-site and transported to the desired location. SMRs can also be integrated with renewable energy sources, such as solar or wind, to create a hybrid system that can balance the power demand and supply.

However, the technology of SMRs is still in its early stages of development and deployment, and there are currently no data centres in the world that use built-in nuclear reactors. Therefore, it remains to be seen whether nuclear reactors will become a common or viable option for future data centres. The decision to use nuclear reactors for data centres should be based on a careful evaluation of the benefits and risks, as well as the alternatives and trade-offs, of each specific case.

It has been calculated that a ‘norma’ data centre (whatever that is), needs 32 megawatts of power flowing into the building. For an AI data centre, it’s closer to 80 megawatts.

AI systems are using all this extra electricity simply because they are doing so much more processing than standard computing. They are chewing through far more data.

As AI continues to develop, so too will the power requirement needed to run these monsters.

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UK retail sales outperforms in January 2024

UK shoppers

Retail sales rebounded in January as shoppers went on a determined spending spree, latest figures show.

ONS figures revealed a 3.4% jump in sales following a drop in December 2023.

Food sales at supermarkets rose strongly while department stores reported a good impact from January sales.

The Office for National Statistics (ONS) said that the value of goods people bought in January went up 3.9%, compared to the 3.4% increase in the volume of products purchased.

Inflation, which measures the pace of price rises, has slowed significantly but at 4% it remains higher than the Bank of England’s (BoE) 2% target.

Sales increased across nearly all retail sectors, and it was a particularly strong month for supermarkets according to the ONS.

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Here are some of the most well-known quotes of all-time

Book of famous quotations

“I have a dream.” – Martin Luther King Jr.

“Fortune favours the bold.” – Virgil

“I think, therefore I am.” – René Descartes

“Time is money.” – Benjamin Franklin

“I came, I saw, I conquered.” – Julius Caesar

“When life gives you lemons, make lemonade.” – Elbert Hubbard

“Practice makes perfect.” – Vince Lombardi

“Knowledge is power.” – Francis Bacon

“The greatest glory in living lies not in never falling, but in rising every time we fall.” – Nelson Mandela

“The way to get started is to quit talking and begin doing.” – Walt Disney

Art illustration of a world book of famous quotes
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Coinbase makes some profit – the first in two years

Crypto platform

Shares of cryptocurrency exchange Coinbase soared 12% Friday 16th February 2024 after the company reported its first profit in two years.

Coinbase, the largest U.S. venue for buying and selling cryptocurrencies, said that net income totalled $273 million in Q4.

This is the first time that the company has reported positive net income since the fourth quarter of 2021.

Net revenue

Coinbase reported its net revenue was $905 million in the Q4 of 2023, up almost 50% from $605 million in the same period of the previous year.

Bitcoin ETFs

Cryptocurrencies saw a huge amount of interest from investors in the fourth quarter of 2023, following news of the U.S. Securities and Exchange Commission approving the first Bitcoin exchange-traded funds (ETFs).

Bitcoin ETFs enable retail investors to access the cryptocurrency as a share that’s traded on a regulated exchange without directly exposing them to the underlying asset.

The news has driven demand for cryptocurrencies due to anticipation that it could drive interest from retail investors.

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OpenAI unveils new AI software that lets you create realistic video by typing a descriptive sentence

Video

The new AI tool from OpenAI named Sora, can generate realistic videos from text prompts.

OpenAI has developed a new AI tool named Sora that can generate highly detailed videos of up to 60 seconds from descriptive text prompts.

The tool has raised concerns about its potential misuse, particularly in the creation of deepfakes and disinformation.

On the other hand, it is a remarkable achievement in the current AI arena and created in such a short space of time.

OpenAI has stated that it is working with experts in areas like misinformation, hateful content, and bias, who are testing Sora.

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Fact or fiction: More Japanese people have a pet than they do children?

Shiba Inu

It’s true. 2012 statistics show that citizens of Japan registered 21 million or so pets against 16.5 million children (under 15 years).

This is a problem for Japan as it has a growing elderly population. It means Japan has one older person for every three citizens. 33% of the population is elderly and not part of its workforce.

If this trend continues Japan is on course to lose around 40% of its workforce and that is a massive problem for Japan’s economy.

According to a survey conducted by Rakuten Insight in 2023, dogs were the most popular pets in Japan, followed by cats and fish. 

The most popular dog breeds in Japan were toy poodle, chihuahua, and Shiba Inu. Many Japanese people love their pets and treat them as part of their family.

Shiba Inu
More Japanese people have a pet than they do children?
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UK economy fell into recession at the end of 2023

UK economy

The UK fell into recession during the final three months of 2023, official figures show, after the economy shrank by more than expected.

The Office for National Statistics said U.K. gross domestic product shrank by 0.3% in the final three months of the year, giving the second consecutive quarterly decline.

That follows a fall between July and September 2023. The UK is considered to be in recession if GDP falls for two successive three-month periods.

All three main sectors of the economy contracted in Q4, with declines of 0.2% in services, 1% in production and 1.3% in construction output, the ONS reported.

Technical recession

A technical recession is a term used to describe two consecutive quarters of decline in output. It is measured by the Gross Domestic Product (GDP), which is the overall output of goods and services in a country.

A ‘technical’ recession is usually caused by slowing growth or an isolated event rather than a major underlying cause.

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Japan’s economy slips into technical recession

Japan recession

Japan’s economy slipped into a technical recession, after the economy unexpectedly contracted again in the October-December 2023period, government data showed Thursday 15th February 2024.

High inflation affected domestic demand and private consumption in what’s now the world’s fourth-largest economy.

Provisional gross domestic product contracted 0.4% in the fourth quarter compared with a year ago, after a revised 3.3% slump in the July-September period. This was below the estimate of a 1.4% growth.

The Japanese economy also contracted 0.1% in the fourth quarter from the previous quarter, after shrinking a revised 0.8% in the Q3. This was also weaker than the expected 0.3% expansion.

Nikkei one year chart to 15th February 2024

Nikkei one year chart to 15th February 2024

Japan has lost its spot as the world’s third-largest economy to Germany, as the country unexpectedly slipped into recession.

Technical recession

A technical recession is a term used to describe two consecutive quarters of decline in output. It is measured by the Gross Domestic Product (GDP), which is the overall output of goods and services in a country.

A technical recession is usually caused by slowing growth or an isolated event rather than a major underlying cause.

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Bitcoin hits $1 trillion market cap again

Bitcoin

The value of all the Bitcoin market capitalization, on Wednesday 14th January 2024 climbed above $1 trillion for the first time since late 2021, according to CoinMarketCap data.

Bitcoin also broke through the 51000 level, marking the first time it has hit this value since December 2021.

The price rise continues a rally that began in January 2023. Bitcoin is up more than 21% in 2024 so far.

One year Bitcoin chart

One year Bitcoin chart from March 2023 to February 2024 – CoinMarketCap
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UK inflation holds steady at 4%, lower than expected

UK inflation statistics

The UK’s inflation rate remained at 4% in January 2024, despite the first monthly fall in food prices in two years, ONS figures show.

January U.K. inflation held steady at 4% year-on-year benefitting from easing prices for furniture and household goods, food and non-alcoholic beverages.

According to the latest figures from the Office for National Statistics (ONS), prices for food and non-alcoholic beverages fell on a monthly basis by 0.4%, marking the first decrease since September 2021.

The core CPI figure excluding volatile food, energy, alcohol and tobacco prices annual reading was 5.1%, below the 5.2% estimate – but only a micro 0.1% difference.

The latest inflation data is a reflection of what is happening in the labour market: a tight labour supply is sustaining high wage growth and thus underlying inflationary pressure.

Inflation still sits double the BoE target of 2%.

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U.S. inflation ticks back up to 3.1%

Chart

Stocks dropped on Tuesday 13th February 2024 after hotter-than-expected inflation data for January caused Treasury yields to spike

The new inflation figure raised doubts that the Federal Reserve would be able to cut rates several times this year, a key part of the equity market bull run case.

The consumer price index rose 0.3% in January 2024 from December 2023. CPI was up 3.1% year-to-year. Economists expected CPI to have increased by 0.2% month over month in January and 2.9% from a year earlier.

U.S. inflation ticks back up in January 2024 figures
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Jeff Bezos sells nearly 12 million Amazon shares worth $2 billion

2 billion

Jeff Bezos filed a statement indicating his sale of nearly 12 million shares of Amazon stock worth more than $2 billion

The Amazon executive chairman notified the U.S. SEC – Securities and Exchange Commission of the sale of 11,997,698 shares of common stock on the 7th and 8th February 2024.

The collective value of the shares of Amazon, which is based in Seattle where he founded the company in a garage around thirty years ago, was about $2.04 billion.

More to come

In a separate SEC filing, Bezos listed the proposed sale of 50 million Amazon shares on or around 7th February 2024 with an estimated market value of $8.4 billion.

Taxing decision?

Jeff Bezos moved from Seattle to Miami in November 2023, shortly before he announced his plan to sell up to 50 million Amazon shares by January 2025. 

Florida does not have a capital gains tax, unlike Washington state, which imposes a 7% tax on any gains of more than $250,000 from the sale of stocks and bonds. Therefore, by moving to Florida, Bezos could save up to $600 million in taxes on his stock sale – more than enough for a luxury yacht and 2 or 3 more luxury properties.

But, of course, we do not know if this was the real reason for his move.

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Arm taking its place in the AI race

AI chip stock up

Arm’s strong growth forecast has led investors to declare it an AI darling

Arm shares soared 29% on Monday, extending last week’s rally as investors continue to applaud the chipmaker’s better-than-expected third-quarter earnings and its position in the artificial intelligence boom.

Up 93% since 8th February 2024

Arm is now up 93% since it reported quarterly figures on 8th February 2024. There is no obvious reason for the 29% climb on Monday. The fear of missing out (FOMO) could be playing a part in the meteoric share price move.

The stock has almost tripled since Arm’s initial public offering in September 2023, closing at $148.97 and is now worth almost $153 billion, that’s a little more than $30 billion below Intel’s market cap.

Arm 1 year chart showing huge gain in February 2024

Arm 1 year chart showing huge gain in February 2024

AI demand fuels Arm’s success

Last week, Arm said it could double the price for its latest instruction set, which accounts for 15% of the company’s royalties, suggesting it can expand its margin and make more money off new chips. It also said it was breaking into new markets, such as cloud servers and automotive, due to AI demand.

Its royalty strength combined with Arm’s optimistic growth forecast has made the company the latest AI darling among investors, despite a higher earnings multiple than Nvidia or AMD.

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Nasdaq 100 hits new all-time high of 17962

Chart up

The index continues its march breaking all-time records on its way

The index continues on its march breaking all-time records on its journey

Nasdaq 100 climbs to new record 9th February 2024

A solid earnings season, easing inflation data and a resilient economy have charged 2024′s market rally. It has helped propel the Nasdaq 100 to close at these new highs!

We are enjoying good news at an economic and earnings level, and the market is reacting positively. The longer the good news story plays out, the more likely it will be that the market will hold from here.

FOMO or the fear of missing out is likely playing its part here too.

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S&P 500 closes above 5000 for the first time

Stoks chart up

The S&P 500 climbed to a new all-time high of 5026 on 9th February 2024

Stocks rose on Friday 9th February 2024 after December’s revised inflation reading came in lower than first reported, and the S&P 500 closed above the key 5,000 level as strong earnings and economic news came in.

A solid earnings season, easing inflation data and a resilient economy have charged 2024′s market rally. It propelled the S&P 500 to close above the 5,000 level after first touching the milestone during the trading week. The index first crossed 4,000 in April 2021.

We are enjoying good news at an economic and earnings level, and the market is reacting positively. The longer the good news story plays out, the more likely it will be that the market will hold from here.

But it won’t take much to spoil the party, right now I don’t know what that might be…?

S&P 500 1-year chart 9th February 2024 – new all-time high of 5026

S&P 500 1 year chart 9th February 2024 – new all-time high of 5026

FOMO or the fear of missing out is likely playing its part here too.

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Japan’s stock markets are on a tear but are the Zombies coming?

Nikkei 225 index

After a decade-long bull run throughout the 1980’s, the Nikkei 225 index reached an all-time high of 38,915 on December 29, 1989, the last trading day of the year.

Few could have imagined, on New Year’s Eve of 1989, that the index would be lower 34 years later. As the New Year arrived, the bubble burst.

And now, Japan’s stock markets are on a tear and closing in on that elusive 38195 high of 1989 – but there’s a catch – the Zombies are coming.

Zombie companies

Zombie firms are businesses that are unprofitable and struggling to keep afloat. They don’t have excess capital to invest and grow the business, or to pay down the loan capital.

Concerns about zombie firms are coming into focus as the Bank of Japan is tipped to raise interest rates in 2024 for the first time since 2007.

It comes as the Nikkei 225 rises to its highest point in almost 34 years

Japan’s stock markets have been on a meteoric run since the start of 2023, repeatedly breaching 33-year highs and outperforming the rest of Asia.

However, there are rising concerns that so called ‘zombie’ firms, which are unprofitable and struggling to keep afloat, could cut short that rally. The Bank of Japan is widely expected to raise interest rates this year, and that could easily tip many of these firms into bankruptcy, which could have a broader impact on the economy and stock market,

Nikkei 225 1-year chart 9th February 2024

Nikkei 225 1-year chart 9th February 2024

Bankrupt businesses

Zombie firms are nothing new in Japan. They first emerged after the stock ‘bubble’ and subsequent crash of the 1990s, when banks continued to support companies that would have otherwise gone bankrupt. 

The pandemic of 2020 accelerated the problem of zombie businesses, with the number of zombie firms in Japan reportedly jumping by around 33% between 2021 and 2022. 

At the end of 2023, Japan reportedly had around 250,000 companies that are technically zombie businesses

Some experts argue that zombie firms are a drag on Japan’s productivity, innovation, and growth, as they occupy resources and crowd out more efficient firms. The debate on how to deal with zombie firms is ongoing and may have implications for Japan’s economic recovery and future prospects.

Others suggest that zombie firms may have a positive effect, such as preserving employment, social stability, and industrial diversity.

Surely, there is no room for inefficiently run businesses making little or no profit in any economy.

Watch out for the Zombies!

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All hail the rally?

U.S. stocks rally

U.S. stocks have had a good year in 2023, and a great start to 2024 with new record highs being set.

Many major indices have recorded double-digit gains. However, some analysts have warned that the rally may not last, as it has been driven by a few large-cap technology and growth stocks, while many other sectors and regions have lagged behind. 

A stock market rally is a broad and rapid rise in share prices, often defined as a 20% increase from a recent low. 

This could indicate a lack of breadth and sustainability in the rally, and potentially signal a market pullback, correction or even a crash in the future.

Bull bear, bull?

Chartists with their technical analysis might see a pattern that points to a substantial upside, but they should not get too carried away with their own observations, right now would be a sensible time for markets to find level ground, if only temporarily. 

The bullish view is that the ‘laggards’ should catch up the ‘mega cap’ stalwarts once again. The bearish view is that the ‘mega cap’ stocks’ will realise they’ve gone too far and need to ride back to the rest of the market. Too few stocks in the same sector hold the balance of power – go check out the Magnificent 7 or even the old FANG stocks.

Catch-up

Either way, there ought to be an opportunity for underrepresented sectors and industries to gain lost ground.

The question is, will there be a pause to allow laggards to catch-up, or will the mega caps simply continue on their march?

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S&P 500, Nasdaq 100 and Dow all hit new highs!

S&P 500, Nasdaq 100 and Dow all up at new highs!

The S&P 500 climbed again Wednesday 7th February 2024 and edged ever closer to the 5,000 level.

S&P 500 hit a new high of 4995

S&P 500 hit a new high of 4995 on 7th February 2024

The index, which first breached the 4,000 level in April 2021, added around 0.82% to close at 4,995.06. During session highs, the S&P hit 4,999.89. Quarterly results signalled a thriving U.S. economy.

The Nasdaq 100 jumped to a new high of 15,755

The Nasdaq 100 jumped to a new high of 15,755 on 7th February 2024

The Dow Jones Industrial Average rallied 156 points to close at 38,677 and an all-time high

DJIA closes at new high of 38677 on 7th February 2024

Euphoric

Are investors getting swept away with the latest wave of AI related tech results? Quite possibly, as some of what we’re seeing could be based on FOMO (fear of missing out) as traders/investors don’t want to be left behind like they were last year.

However, one undeniable fact is that the U.S. economy isn’t facing as recession any time soon as predicted by many.

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‘Congratulations, as you’re the only one able to spell ‘gover ‘n’ ment’ correctly – you’ve got the job. Would you like education or something a little less taxing like… the treasury?’

Government job interview

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THE DEPARTMENT OF GOVERNMENT JOB DISTRIBUTION AND OTHER THINGS LIKE THAT

‘Congratulations, you’re the only one to spell ‘gover ‘n’ ment’ correctly – you’ve got the job. Would you like education or something a little less taxing like… the treasury?’
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Big surprise U.S. jobs rise in January 2024

U.S. workers

Job creation in the U.S. surged in January 2024, as the economy continued to defy predictions of a slowdown

The U.S. economy added 353,000 jobs and average hourly pay jumped, while the unemployment rate held steady at 3.7%, the Labour Department said.

The report extended more job gains that has surprised economists, who have expected a jump in interest rates since 2022 to slow the economy. It hasn’t. No recession or slowdown in the economy so far.

Early rate cut less likely according to these figures

  • Average hourly earnings increased 0.6%. Year-on-year basis, wages jumped 4.5%, above the 4.1% forecast.
  • Non-farm payrolls expanded by 353,000 for the month, well above the 185,000 estimate. The unemployment rate held at 3.7%.
  • Job growth was widespread in January 2024. Professional and business services 74,000. Other sectors included health care 70,000 and retail trade 45,000.

Analysts now say the job market gain and strength make an early interest rate cut less likely.

The U.S. employment data delivered quite a shock, easily beating expectations, with earnings much higher than expected. Stock markets gained and are at elevated levels for the Dow, Nasdaq and the S&P 500. Record highs have been set – are the highs?

Market analysts said these numbers show the U.S. economy is strong and will change the mindsets of those expecting an early interest rate cut.

Expectations of a recession are off the table too, for now.

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Another decade of world debt

World debt

The world is looking at a debt crisis that will span the rest of this decade and well into the next

$307.4 trillion of world debt!

It’s not going to end well; economists warn with global borrowings hitting a record of $307.4 trillion in September 2023.

Debt at this level is unsustainable.

Both emerging markets and high-income countries have seen a substantial rise in their debt levels. These levels have grown by a some $100 trillion from 10 years ago. The debt has been fueled in part by a higher interest rate environment. 

Initially, with borrowing costs at historic lows, countries have benefitted from very low interest rate for the debt. That’s changed.

The next 10 years will likely become known as the ‘Decade of Debt.’

Debt globally is coming to a head.

As a share of the global gross domestic product, debt has risen to 336%. This compares to an average debt-to-GDP ratio of 110% in 2012 for advanced economies, and 35% for emerging economies. It was 334% in the fourth quarter of 2022, according to the most recent global debt monitor report by the Institute of International Finance.

To meet debt payments, it is estimated that around 100 countries will have to cut spending on critical infrastructure including health, education and social projects.

Countries that manage to improve their fiscal situation could benefit by attracting capital, labour and investment. However, those that do not could lose talent and revenue and further increase their debt burden.

$307.4 trillion of world debt, and counting!

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Facebook turns 20 years old

Facebook at 20

Facebook, the social media giant that connects billions of people around the world, celebrated its 20th anniversary on February 4, 2024.

Founded by Mark Zuckerberg and his fellow Harvard students in 2004, Facebook has grown from a college network to a global phenomenon, with over 3 billion monthly users and counting.

Facebook has also changed the way we communicate, share, and connect with each other online, enabling us to keep in touch with friends and family, discover new content and communities, and express ourselves freely.

Controversy

However, Facebook has also faced many controversies and challenges over the years, such as privacy issues, misinformation, child safety, and political scrutiny. Facebook has been accused of violating user data, spreading fake news and hate speech, enabling cyberbullying and online abuse, and influencing elections and public opinion.

How ‘the’ facebook looked 20 years ago

Facebook has also faced competition from other platforms, such as TikTok, Snapchat, and X, as well as regulatory pressure from governments and activists.

Evolving

As Facebook turns 20, it is still evolving and expanding under its parent company Meta, which also owns Instagram and WhatsApp. Meta’s vision is to create a metaverse, a virtual reality where people can interact and experience immersive digital worlds. Meta also aims to invest in artificial intelligence, blockchain, and cloud computing, as well as social good initiatives, such as connectivity, education, and health.

Facebook’s future is uncertain, but it is undeniable that it has shaped the history and culture of the internet and the world, for good and bad.

See BIG tech results here as Meta share price gains 20% after positive earnings impress Wall Street.

Mark Zuckerberg is currently the third richest person in the work coming with a wealth of $161 billion. Not a bad income for 20 years’ work.

Whatever happened to myspace?

Meta recent share price 1 year chart

Meta recent share price 1 year chart