Insights on markets, emergent trends, history, innovation, risk management, global economics, strategy, policy, and other topics that catch our attention. Inspired by ongoing research, conversations and events. Written and edited by Osbon Capital Management and published every Thursday morning.
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2024 will bring more positive novel surprises. New years always do. In 2023, it was the dramatic acceleration in AI, which touches nearly every industry, and the early stages of an answer to the obesity epidemic with GLP-1s. Here is a list of what’s on our minds going into 2024.
Private Markets, Nuclear, Japan Population
GDP Mea Culpa Last week, I wrote about the substantial US GDP growth we’ve experienced since Covid. I mistakenly referred to the 5.2% Q3 growth figure as “nominal” instead of “real”. This means the GDP growth rate comments I discussed last week are higher and, therefore, even more positive on both a real and nominal basis. Private market valuations…
GDP Growth, Inflation By Choice, XPrize
GDP growth is fairly substantial GDP is used as the topline scorecard for a country’s economic health. This week US Q3 2023 GDP was revised up to 5.2%, up from 4.9% on the first announcement. The third and final revision will be in December. People generally respond positively to round numbers and seeing a number over 5% is a positive…
AI Comments Going Into Thanksgiving
AI Comments After a dramatic week for the tech world, Sam Altman appears to be returning to OpenAI. OpenAI is the only company to deploy AI tools for the consumer market successfully, and they’ve been ahead of the innovative curve for at least a year, if not longer. The scarcity of companies like OpenAI forces investors to accept terms…
Looking Ahead, Taxes, Big IBM Change
Looking Ahead Anyone holding cash in money market funds for the past year has enjoyed a nice, consistent, risk-free interest payment courtesy of the Fed’s high-interest rate policy. For cash, money market funds pay about 5%. Looking ahead, the futures market expects the Fed to cut rates by 1% this time next year. 4% risk-free on cash one year from…
Byron Wein, AI, Quick Bites
Byron Wien History Legendary investment writer Byron Wien passed away this week. John Osbon worked with Byron at Morgan Stanley back in the day. In fact, John credits Byron directly for inspiring the discipline of regularly publishing investment insights to communicate, clarify thoughts, keep records of successes and mistakes and promote continuous learning. Byron was most famous for his annual…
Comments on Automation
Comments on our automated future I recently visited an Apple store to buy replacement headphones. An employee showed me how to self-checkout via iPhone. I didn’t know this was an option. Next time you go into an Apple store, you should know that you can pick an item off the shelf, scan it with your iPhone, double-click to pay with…
Optimism, Talus, Fink
Optimism Markets and economies are complex adaptive systems. This makes them good at responding positively in the long run to the many unique challenges presented over the short run. When we wear the hat of the risk manager, as we are all programmed to do naturally, it’s tempting to get caught up in a string of negative narratives. While it’s…
World, Land Value Tax, New Unicorns
World The ongoing events in Israel are horrific and tragic. The difficulty of predicting the onset and conclusion of acts of war is on par with predicting natural disasters. Conflict can end just as suddenly as it started or last a decade. The end of the conflict in Ukraine is similarly uncertain. In 2024, 50% of the world’s GDP will…
Treasury, Michael Lewis, Batteries
Impact of rate moves, serious but manageable For the past few weeks, we’ve been discussing how the increase in the long end of the treasury curve continues to create issues across financial markets. The 20-year treasury bond is currently over 5%, meaning a buyer at today’s prices earns 5% every year risk-free, and anyone stuck holding lower-yielding debt has lost…
