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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Too much time is spent talking about price. Fundamentals are ultimately what drive equity prices higher over time. To say this another way, a company’s stock price can’t continue to rise unless it continues to be successful. The famous quote by Warren Buffett is, “In the short run, the market is a voting machine, but in the long run (...)
Rates, Populism, Banks Shift To Private Markets
Rates The Fed raised rates by 0.25% yesterday, as originally anticipated two weeks ago. That was before Powell spooked markets with talk of higher rates for longer, and then regional banks fell apart due rate hike induced bond losses. Despite all of the noise, the predicted 0.25% hike occurred. The next hike is over a month away, with another CPI…
The Banks, Rates, AI Releases
The Banks Big questions remain following the collapse of Silicon Valley Bank. To start, who is to blame? It’s fair to say that both the Fed and SVB are responsible. The bank clearly mismanaged its risk in the face of rising rates. Social media and mobile apps also dramatically accelerate bank runs. Bond performance doesn’t get the headline coverage it…
Fed, Organic Growth, AI Again
The Fed The primary story this week has to do with the change in expectations for the Fed’s rate hikes in the short term. The next rate hike on March 22nd marks the 1 year anniversary since the start of this rate-hike inflation-fighting saga. The Fed has gradually slowed its hikes over the past few months from .75% to .50%…
AI Transition, Berkshire
AI Transition AI growth continues to impress. The number of offerings and the quality seem to improve on a weekly basis. Just about anyone is able to leverage it to their immediate benefit. We discovered ClaraLabs this week, a polite automated scheduling assistant that sends emails and follows up. Like many automated natural language tools, it’s surprisingly sophisticated and performs…
Applied AI Examples & Rates
Brief Update On Rates Expectations The Fed’s interest rate policy is still the foot on the back of markets and the economy. 2023 will present us with the tail end of those hikes, but it’s not over yet. On March 22nd, the Fed will likely raise rates from 4.75% to 5%, a quarter-point (.25%) hike. There’s an increasing probability we…
Inflection Points, AI’s Sydney
Inflection Points There is no shortage of bear market theories circulating in the investment community and media. While there are many intelligent reasons to be negative, there comes the point where reflexive bearishness turns into a blindspot. It seems likely to me that we are at that point today. There are a handful of key inflection points from recent months…
Robotics Growth, AI Sparring, Unicorns
Robotics Growth We wrote a few weeks ago about how global businesses are deploying over 500,000 new robots annually. Amazon alone has 500,000 robots in operation today, along with 1.6m employees. So far Amazon’s pace of hiring and the total robot count has increased in unison, but don’t expect that to last much longer. Companies like Amazon are known for…
Practical AI, Rates
All eyes on rates For the first time since Nov 2021, we are seeing the first real reprieve from the persistent downward pressure on markets. The overwhelming strength of the dollar peaked in October when the GBP hit 1.06, the EUR hit .95 and the Yen hit 150. A weaker dollar will help earnings going forward. As expected, this week…
Status Quo, Innovators, Buffett
Status Quo People and companies typically don’t change unless or until they’re forced to. Christensen’s Innovator’s Dilemma points out how companies often fail to grab new markets because they both fear disrupting their core business and vastly underestimate the opportunity. An amazing amount of innovation gets left on the table when companies follow the status quo. Google invented the transformer…
