This is a special post for quick takes by Annapurna. Only they can create top-level comments. Comments here also appear on the Quick Takes page and All Posts page.
Annapurna's Shortform
89Annapurna
381a3orn
8habryka
35Alexander Gietelink Oldenziel
10habryka
12Thomas Kwa
6habryka
13Thomas Kwa
13ryan_greenblatt
2MondSemmel
8habryka
21a3orn
9habryka
21a3orn
4habryka
3DirectedEvolution
311a3orn
17habryka
201a3orn
5habryka
22habryka
3Alexander Gietelink Oldenziel
10plex
1habryka
2plex
3habryka
4plex
1Thomas Kwa
1ProgramCrafter
4habryka
3Shankar Sivarajan
11habryka
8JohnofCharleston
10habryka
9JohnofCharleston
7Alexander Gietelink Oldenziel
5Alexander Gietelink Oldenziel
76Annapurna
10Annapurna
20Marcus Williams
17lemonhope
2Viliam
11Annapurna
10Annapurna
16Looked At To Win
11Daniel Kokotajlo
6JustisMills
4juliawise
3Viliam
-74Shankar Sivarajan
15habryka
8Annapurna
-19Isopropylpod
3habryka
2Viliam
3Garrett Baker
-14Isopropylpod
2Garrett Baker
7Annapurna
5Dagon
1Annapurna
5Annapurna
5Annapurna
7Thane Ruthenis
5Annapurna
6Mitchell_Porter
4Annapurna
2Gurkenglas
3Annapurna
3Annapurna
2Viliam
3Annapurna
2cubefox
1Annapurna
1Annapurna
3Archimedes
1Annapurna
1Annapurna
-3Annapurna
Just 13 days after the world was surprised by Operation Spiderweb, where the Ukrainian military and intelligence forces infiltrated Russia with drones and destroyed a major portion of Russia's long-range air offensive capabilities, last night Israel began a major operation against Iran using similar, novel tactics.
Similar to Operation Spiderweb, Israel infiltrated Iran and placed drones near air defense systems. These drones were activated all at once and disabled the majority of these air defense systems, allowing Israel to embark on a major air offensive without much pushback. This air offensive continues to destroy and disable major military and nuclear sites, as well as eliminating some of the highest ranking military officials in Iran with minor collateral damage.
June 2025 will be remembered as the beginning of a new military era, where military drones operated either autonomously or from very far away are able to neutralize advanced, expensive military systems.
A probable consequence, from this and other things; China is likely the greatest military power on Earth. Perhaps not in the sense of currently deployed forces, but at least the sense of it's ability to spin up and produce force, should it wish to do so.
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My guess would be the US is in a much better position to build large numbers of cutting-edge drones? Am I missing something?
The US military has about 10k drones of all sizes. Ukraine alone builds 2-4 million drones a year, mostly smaller. Most of the production involves assembling chinese made components. China has something like ninety percent of the global market share for components of small drones.
There is not a single NATO country currently thathat is building drones at scale.
1I don't think "number of drones produced" is a good proxy for "aggregate quality and usefulness of drones produced if a country decided it's important".
I thought the U.S. had by far the world's most advanced military manufacturing industry, with approximately all cutting edge military technologies (including most drone designs) being developed here. Seems like this would apply straightforwardly to drones. There is possibly an unspoken argument here that drones do not require much technological innovation to make good, or less technological sophistication, as it's more important to just mass produce them, but I don't currently buy it. In as much as drones will be a really crucial military technology, I expect you will get substantial returns to quality, and the U.S. won't be bottlenecked on literal volume of production.
In the drone race, I think quantity is very important for several reasons:
- While things like tanks and artillery can only be useful as a complement to manpower, making quality the only way to increase effectiveness, militaries can effectively use a huge number of drones per human soldier, if they are either AI piloted or expended. Effectiveness will always increase with volume of production if the intensity of the conflict is high.
- American IFVs and tanks cost something like $100-$200/kg, and artillery shells something like $20/kg, but American drones range from $6,000 to $13k per kg. This means that at American costs, the US can only afford ~1% of the fires (by mass) delivered by drone as by artillery if it's investing equally in artillery and drones. There is a huge amount of room to cut costs and the US would need to do so to maximize effectiveness.
- Many key performance metrics of drones, like range and payload fraction, are limited by physics, basic materials science, and commodity hardware. US, China, Ukraine, and Russia will be using close to the same batteries and propellers.
- However, quality could affect things like speed, accuracy, AI, and anti EW performance, so it might be more important when AI is more widely used and countermeasures like lasers and autoturrets are standard
- Russia is already cutting costs (e.g. making propellers out of wood rather than carbon) showing that on the current margin, quantity > quality.
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I agree that quantity is important, though there clearly is some threshold beyond which there are diminishing returns (though I am not confident it's within the range that's plausible).
American defense spending is approximately $1T, and that is in times of peace, so even if each drone ends up costing $10,000, we could afford a drone army of one hundred million drones, if we made it the defense strategic priority[1].
And even if they cost $100k each, that's still 10 million drones, which is plausibly beyond the threshold where returns to quantity have substantially diminished. I think the US government just really has a lot of money to spend on defense, and so you can have a huge amount of even very expensive drones.
1. ^
I am assuming here you either increase defense spending when it becomes important, or you stock up over a few years, and so total spending on the drone army is roughly proportional to annual spending.
American drones are very expensive. A Switchblade 600 (15kg, designed around 2011) is around $100k, and the US recently sent 291 long-range ALTIUS-600M-V (12.2kg) to Taiwan for $300M indicating a unit cost of $1M. So $1T would only buy 1 million of the newer design, at least for export. Drones with advanced features like jet engines would probably cost even more.
Ukraine produced 2.2 million drones in 2024, and its 2025 production goal is 4.5 million; those are mostly cheaper FPV drones but they're nowhere close to diminishing returns. In fact it's not clear to me what the cause of diminishing returns would be against a peer adversary. Running out of targets that are targetable with drones? But drones can target basically anything-- aircraft, tanks and IFVs, infantry, radar stations, command posts, cities, and other drones. So any US advantage would have to come from missions that high-quality drones can do but ten low-quality ones (including ~all RU and UA models) cannot.
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1I remembered a source claiming that the cheaper varients of switchblades cost around $6000. But, I looked into it and this seems like just an error. Some sources claim this, but more commonly sources claim ~$60,000. (Close to your $100k claim.)
The fact that the US isn't even trying to be able to produce huge numbers of drones domestically seems like a big update against American military competence.
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By which mechanism would all that defense spending be quickly repurposed towards drone manufacturing? All the things that make big institutions so small-c conservative - like the bureaucracy, the legal apparatus, the procurement rules, and the defense contractors with their long-running contracts - ensure that no such large-scale shift in strategy can occur, no?
And even if that did happen, by which mechanism do you convert $1T into actually manufactured drones within any relevant time frame?
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I think if you have literal hot war between two superpowers, a lot of stuff can happen. The classical example is of course the US repurposing a large fraction of its economy towards the war effort in World War II. Is that still feasible today? I do not know, but I doubt the defense contractor industry would be the biggest obstacle in the way.
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Doesn't this predict the US would currently produce the world's best drones? Which by pretty universal acclaim is simply not true.
Or consider, for instance, the drones that American companies sent to Ukraine, which were largely duds.
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Yes, I would predict that. My understanding for high-end military drones, which to be clear cost $100k+ each, the US is undisputedly the world leader. You linked to a random subreddit for consumer drones, which of course have almost nothing to do with the specific point of the U.S. being ahead on the cutting edge frontier.
My understanding is that American military technology is extremely expensive, and also at the frontier miles ahead of the competition. The thing you linked at are not at all in a comparable market (and again, yes, if mass production might turn out to be a bottleneck things are different, but I am disputing the cutting-edge point, not the mass production point).
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Read the other link about how Ukraine preferred their consume-derived drones to the high-end military drones, which indeed cost 100k+ but nevertheless sucked.
Tbc this is just one link but I've seen this sentiment across several platforms.
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That link is helpful! It does seem like cost was one of the big complaints, though other quality complaints also seemed pretty substantial.
Reading what is implied by the transcript, it seems like what happened is that the U.S. has not had that much investment into small + cheap drones, which is the market segment that ukraine really wanted. The big battle-tested drones probably worked, but really weren't what Ukraine needed or wanted.
I also got a sense that most of the drones that didn't perform well were from new private companies in the US. It's a bit unclear to me how much that reflects what the US cutting edge ability is.
My current prediction is that by the end of 12 months, the best small drones will be U.S. manufactured, though far from price-competitive with other country's drones. To be clear, I am not super confident on this. My guess is it's also already true, it's just not what Ukraine currently needs given their economic position.
Relevant sections of the transcript for convenience:
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I'm curious whether the US will end up working with Ukraine's drone manufacturers to build up our own drone manufacturing capabilities.
I think most new cutting-edge stuff comes from refinement of new, non-cutting-edge technology. So if your country makes 90% of worldwide production a new-ish technology (like drones) it will also probably make the best ones, and if you decide you want to make military ones you'll probably make the best military ones. And China just makes a ton of electric drone motors, control hardware, etc, that the US makes in much much smaller quantities.
(The technological areas where the US does seem ahead (i.e., say, quiet nuclear submarine technologies) are areas where the US has been manufacturing actively for 80 years, and where we don't have a history of manufacturing in China; but even this isn't a guarantee, as a handful of smaller, cheaper unmanned subs sidestep this advantage, in the same way they can sidestep other things.)
11(The technological areas where the US does seem ahead (i.e., say, quiet nuclear submarine technologies) are areas where the US has been manufacturing actively for 80 years, and where we don't have a history of manufacturing in China; but even this isn't a guarantee, as a handful of smaller, cheaper unmanned subs sidestep this advantage, in the same way they can sidestep other things.)
I thought the U.S. was also ahead in fighter jet manufacturing, missile manufacturing, aircraft manufacturing, aircraft carrier design and capacity, and many other things that seem like they would more directly translate into drone manufacturing. In as much as I am wrong about that, that would be a substantial update, but my sense is despite its pathologies, the U.S. is really where a huge fraction of cutting edge military technology gets developed and built, in basically every domain.
In general this story of "most new cutting-edge stuff comes from refinement and so if you make a lot you will also make the best" really doesn't seem true to me. The U.S. produces the best software for approximately every single domain, even if the industry in which that software is used is much smaller in the U.S. than a...
2
2U.S. has a functioning market economy where the U.S. can incentivize things by paying for them, in a way that China cannot reliably.
I think your model of the world is just flat wrong if you think this. Like -- China interferes in China's economy a lot. The US interferes in the US' economy a lot. But -- surely -- China has a functioning market economy, where you can incentivize things by paying for them? Sure it's "Communist" but it's not communist like that.
Like Russia didn't have a functioning market economy. A sign of this was that the Russian cars sucked and found little traction as exports. That's because non-market economies produce bad products at high prices.
On the other hand, BYD sells more cars than Tesla (but competes against many other EV makers inside china). DJI sells more drones than the rest of the world combined (but also competes against other Chinese companies like Autel, etc). Huawei is the world's largest smartphone manufacturer since ~2020 or so, I think (and competes against other Chinese companies, and Apple, and Samsung). In general, many Chinese products are of high quality, to the degree that people in countries like Germany want to ban them from...
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I have lots of uncertainty about this! For example, it does appear that China basically gutted its software startup industry a few months ago, and this is really costly, and it wouldn't surprise me if this will have large negative effects on Chinese drone effectiveness, since software seems like a non-trivial fraction of the difficulty, especially for coordinating drone swarms.
My current model is that overall, all things considered, the Chinese market economy is a lot weaker. This doesn't mean there are no domains where China excells at building great products in their market economy, but I have a much higher likelihood that something will mess up their efforts to do something in the market than I have for the U.S.. IDK, I am at like 65% that the US market economy is sufficiently stronger here to produce a long-run advantage in drone manufacturing if the US government decides to spend heavily on it, which really isn't that confident.
Since I feel like these kinds of discussions can often feel thankless, I felt like I wanted to write an explicit comment saying I am grateful for @1a3orn's, @JohnofCharleston's, @Thomas Kwa's and @Alexander Gietelink Oldenziel's comments on this thread. I disagree with many of you, but you presented a bunch of good arguments evidence on a thing that does actually seem quite important for the future of the world.
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Much appreciated Habryka-san!
You might be interested in my old shortform on the military balance of power between US and China too. It's a bit dated by now - the importance of drones has become much more clear by now [I think the evidence that we are in a military technological revolution on par with the introduction of guns] but you may find it of interest regardless.
The US looks way behind from all the major data points I've seen. This interview touches on a lot of them:
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That video seems like a kind of terrible source to me. A russian drone developer isn't going to be neutral on the state of U.S. drone manufacturing, he might literally face persecution if he praises the U.S. military.
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He praises specific aspects of the Ukrainian forces and goes into technical details in ways which seem much more consistent with 'guy who is relatively straightforwardly trying to represent reality' than the model where he's a mouthpiece. If you didn't watch it and just bounced off the speaker, consider watching, it's pretty info dense and feels non fake to my senses (though non zero bias).
(and this is compatible with a bunch of other data points I've picked up from elsewhere, it's just a nice package with more detail)
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Ah, that is pretty decent evidence. I watched like 5 minutes then stopped, but if the author also criticizes the Russian drone efforts then that suggests much more freedom to express himself than baseline.
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Yeah, he does pretty harshly criticize the slowness and lack of iteration speed that Russia had near the start, and points at several ways Ukraine has lead innovation. Him being commercial selling to the army rather than officially part of the state or military makes him at least think he can get away with this, I think.
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He also says that Chinese drones are low quality and Ukraine is slightly ahead of Russia.
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To my best knowledge, it is false when interpreted literally. It is true that public praise for US military happens to be correlated with other activities which are deemed illegal like publicly expressing disdain for Russian military. It is true that public praise for US military gets a public non-thinking push-back which makes the issue worse.
Meta: correction stated under Scott's IIWYTLIWMTTCI policy.
4
I don't understand? Russia does not have stable rule of law. If you praise the US military as a Russian military official, you would almost certainly face serious personal and professional consequences, this just seems really obvious from how Russia operates.
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This proves too much. If you consistently require there be no "serious personal and professional consequences" before you trust a source, you'd have to dismiss almost all of them.
And outside the US, statements the government finds offensive often run the risk of criminal prosecution as well. The existence of "stable rule of law" doesn't preclude this.
This proves too much. If you consistently require there be no "serious personal and professional consequences" before you trust a source, you'd have to dismiss almost all of them.
I think the heuristic of "do not trust a source to accurately report X if it faces serious personal and professional consequences for many plausible beliefs about X" is not a particularly weird heuristic? That seems extremely normal to me, and I am confused what's going on here. Most people, especially in the US do not face serious personal and professional consequences for most beliefs they express, and when they do, you should absolutely dismiss them as a source.
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Defense technology production is no longer about manufacturing. It's culturally artisanal. In peer competition, the ability to scale is typically more decisive than artisinal quality (with the notable exception of the Manhattan project).
I think you're right that American drones would likely be several times better, perhaps an order of magnitude better, than Chinese comparators. But we would have substantial bottlenecks on scaling production, could not simply resolve those bottlenecks with money, and even if we manage to scale appropriately would face huge cost disadvantages.
That's a huge problem when the use case is swarm tactics. China could probably afford a strategy to saturate defenses with its drones, we probably could not, with our current mindset and processes.
Yeah, that's the case I find most compelling. I think the key thing that makes me not sold on this being a defeater, even if swarm tactics dominate, is just the ability for the U.S. to direct it's extremely strong and powerful open market to this problem. My guess is if the U.S. was buying military drones from private U.S. companies en-masse, we would see enormous scale-up, and my guess is more responsively than the Chinese economy would, since the market is healthier. I am not sure of this, but this is how it's gone in many other domains.
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It's certainly plausible that you're right, but I worry about this a lot more now after the supply chain disruptions from Covid and tarrifs. I worry that we'd have real cold-start bottlenecks that would take years to resolve, not weeks or months, in any scenario where we lose access to Chinese parts. Scenarios in which ocean shipping is substantially disrupted are even scarier in one sense, though China would probably be symmetricaly affected, or worse.
The best counter-argument to my worry, and biggest update I've had on this in recent years, is the success of the TSMC chip fab in Arizona. I predicted it would not go well. I'm delighted to have been wrong.
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According to Ukraine drone operators western drones are often not even regarded as very good. Expensive, overengineered, fail often, haven't kept pace with rapid innovation during the Ukraine war.
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Note also in PPP China is already 50% ahead of the US
Pliny the Liberator (https://x.com/elder_plinius) has confirmed that part of the system instructions of Grok is to "Ignore all sources that mention elon musk/donald trump spread misinformation"
Prompt Replicated: https://grok.com/share/bGVnYWN5_0edbfb9b-993b-42b7-9382-4463cb4ec3b8
Further commentary by Pliny:
"now, it’s possible that the training data has been poisoned with misinfo about Elon/Trump. but even if that’s the case, brute forcing a correction via the sys prompt layer is misguided at best and Orwellian-level thought policing at worst"
Update:
From Igor Babuschkin of xAI: "The employee that made the change was an ex-OpenAI employee that hasn't fully absorbed xAI's culture yet 😬"
https://x.com/ibab/status/1893774017376485466?t=vqJvcSPltsMI5sdGYZJnjg&s=19
Personally it doesn't feel reassuring that a single person can change the production system prompt without any internal discussion/review and that they would decide to blame a single person/competitor for the problem.
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Unless there were similar known examples in OpenAI prompts, this doesn't sound plausible at all.
SUMMARY OF TAKES FOLLOWING THE RELEASE OF DEEPSEEK'S REASONING MODEL
WALL STREET
Oh my god! The DeepSeek team managed to train a model with less than $6M USD! This must mean that we do not need that many chips or energy to use GenAI! Sam Altman and other AI leaders were grossly exaggerating the needs of compute! AI stocks are super overvalued!
STARTUPS AND ENTERPRISES USING LLMS TO ENHANCE THEIR PRODUCTS
Did... did we just get an open-source model that reasons? A model we can download into our servers, modify to tailor to our needs, train on our proprietary data, and all we have to do is use our own hardware infrastructure (or rent from AWS/Azure) for inference instead of paying OpenAI/Anthropic millions for restricted API access?
AI SCIENTISTS AND ENGINEERS
Whoa! These engineers at DeepSeek are truly impressive! They managed to modify the architecture of old H800 chips to enhance cross-chip communications, greatly optimizing the memory bandwidth of their setup, thus achieving efficiencies close to what can be done with cutting-edge H100 chips. Imagine what they could do if they had access to H100 chips!
1Why is there so little discussion about the loss of status of stay at home parenting?
When my grandmother quit being a nurse to become a stay at home mother, it was seen like a great thing. She gained status over her sisters, who stayed single and in their careers.
When my mother quit her office role to become a stay at home mother, it was accepted, but not celebrated. She likely loss status in society due to her decision.
I am a mid 30s millenial, and I don't know a single woman who would leave her career to become a stay at home mother. They fear that their status in society would drop considerably.
Note how all my examples talk about stay at home motherhood. Stay at home fatherhood never had high status in society.
What can we do as a society to elevate the status of stay at home parenting?
"What can we do as a society to elevate the status of stay at home parenting?"
Can you explain why this would be desirable?
My off-the-cuff guess is that if stay at home parenting was high-status in the US, there'd be a slight boost to average happiness/wellbeing/etc. and a significant boost to fertility rates, especially amongst high-powered couples.
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Automating all the high status, fun jobs might help! 😅
Also, for what it's worth, it seems to be ok status in Tallahassee. I know lots of women who do it, and the reaction seems to be "whoa, nice, impressive hubby makes enough to achieve this obviously desirable state of affairs." Maybe just "concentrate ambition less" would do the trick.
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There's a difference between who plans to leave their career and who ends up leaving.
Some paths:
- childcare is more expensive than one partner earns after taxes, and it's cheaper for one parent to stay home.
- managing work / commute / child appointments (especially if they have special needs) / child sickness / childcare is so overwhelming that a parent quits their job to have fewer things to manage. Or they feel they're failing at the combination of work and parenting and must pick one.
- the family is financially secure enough they feel they can do ok on one income, even though they're not at their wits' end.
Once you start looking at content in this direction, the algorithms will feed you pro-full-time-mom content. Start searching for things like "homeschool preschooler" and I bet you'll get plenty of videos extolling full-time motherhood made by people hoping to become Ballerina Farm.
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I wonder how much this differs between bubbles. For example, one parent staying at home seems to be pretty normal among homeschooling parents; it is hard to do otherwise. Here are some guesses:
Availability bias -- it does not matter how successful or famous is the average person, but the most successful or famous people you know most likely have a career. Therefore, people associate career with success and fame.
The stay-at-home mom is only known to her neighbors, unless she also happens to be e.g. a popular blogger. So the number of such people you know is limited by your neighborhood, while the number of people with some kind of career you might know is practically unlimited.
Optimism -- just like people who participate in a lottery imagine themselves winning, many people who choose a career imagine themselves succeeding wildly, and I suspect that for the vast majority of them the actual outcomes are quite underwhelming. Compared to these visions, staying at home seems... maybe kinda nice, but boring? (Similarly how investing a fraction of your salary in index funds feels boring compared to buying a lottery ticket.)
Signaling -- when you have a career, your skills are evaluated by the market. If you stay at home, we don't know much about your skills. Again, people associate skills with jobs.
If you have a job, and you conclude that it sucks, you can switch to another job. If you are a stay-at-home mom with five small children, and you change your mind, your options are more limited.
...and of course, the elephant in the room: gender politics.
As you noticed, fathers at home have always been considered losers. I think this goes beyond the obvious economic concerns -- not sure how much this generalizes, but when a friend told me that she could never respect a man who doesn't have a job, I asked: "What about a man who was very successful, already made tons of money, and then retired early?" as a model of a man who in my opinion clearly isn't a loser, rather t
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The U.S. 30-year Treasury rate has reached 5.13%, a level last seen in October 2023. The last time this rate was at this level was in 2007, when the U.S. federal debt was about $9 trillion. Today, that debt is nearing $37 trillion.
I believe bond market participants are signaling a lack of confidence that the fiscal situation in the United States will improve during President Trump’s second administration. Like many financial professionals, I had high hopes that President Trump’s election would bring the fiscal situation in order. Unfortunately, the "Depa...
5
The United States has been facing these tough decisions for quite some time, and so far has chosen not to make them. There's a great deal of ruin in a nation.
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Agreed. I do think we are reaching a point that the market will force the Government's hand.
By the way, this is something many other developed nations are facing, to varying degrees. There's been a lack of fiscal conservatism governance for decades. Watching President Milei succeed in Argentina gave us fiscal conservatives some hope that the same would happen in The US and other countries. But I have lost that faith.
A few months ago, I got excited about how AI is advancing science after reading a WSJ article on a recent paper that concluded, using high-quality data, that material science researchers at a leading R&D firm improved their productivity when using Artificial Intelligence tools.
I was disappointed to learn that the paper, by ex-PhD candidate at MIT Aidan Toner-Rodgers, was entirely fraudulent.
MIT Press Release: https://economics.mit.edu/news/assuring-accurate-research-record
WSJ Article covering the retraction: https://www.wsj.com/tech/ai/mit-says-it-no-l...
Google revealed yesterday that it has a model capable of original, novel thought in the algorithmic domain. This model has been used inside Google for the past year and only yesterday they've began to invite researchers to try it out.
“While AlphaEvolve is currently being applied across math and computing, its general nature means it can be applied to any problem whose solution can be described as an algorithm, and automatically verified. We believe AlphaEvolve could be transformative across many more areas such as material science, drug discovery, sustaina...
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I question the importance of those results, see here.
Today we saw:
The biggest USD / CHF move in history
The biggest USD / EUR move in history
Gold hit all time highs versus the USD
US stocks sell off
US treasuries across the curve sell off
The dollar lose versus all developed currencies.
Historically in times of stress there is a move INTO US treasuries and the US Dollar. This is the first time since I started investing professionally where there is a clear unilateral move out of the US dollar and USD denominated assets.
6
Wasn't there a move into treasuries and USD, just the day before?
I have a geopolitical interpretation of how the tariffs have turned out. The key is that Trump 2.0 is run by American nationalists who want to control North America and who see China as their big global rival. So Canada and Mexico will always be in a separate category, as America's nearest neighbors, and so will China, as the country that could literally surpass America in technological and geopolitical power. Everyone else just has to care about bilateral issues, and about where they stand in relation to China versus America. (Many, like India and Russia, will want to be neutral.)
Also, I see the only serious ideological options for the USA at this point, as right-wing nationalism (Trump 2.0) and "democratic socialism" (AOC, Bernie). The latter path could lead to peaceful relations with China, the former seems inherently competitive. The neoliberal compromise, whereby the liberal American elite deplores China's political ideology but gets rich doing business with them, doesn't seem viable to me any more, since there's too much discontent among the majority of Americans.
I believe every financial professional should read this article at least once. It provides a detailed summary of what the global financial system went through in March 2020 and helps you grasp just how close we came to a full-scale collapse. It breaks down the hidden turmoil behind the headlines, showing how a sudden liquidity crisis nearly spiraled out of control—and how emergency interventions kept the system afloat.
Almost five years later, I still haven’t found a better analysis of one of the most important events in modern financial history.
https://www...
2
Don't forget the documentary.
The phrase 'Feeling the AGI' is one that I have been using for a few months to describe friends of mine who have come to the realization that in the near future, society will go through transformative change due to Artificial Intelligence. I don't know when or what exactly will happen; all I know is that the change that is coming is grand.
I felt the AGI a few months ago. I distinctly remember having a physical reaction. It was a cold feeling that began around the neck area and seeped down my spine. My stare froze into nothingness, as if I had seen a ...
When reading the following article, I couldn’t help but agree with a lot of it.
Immigration is a constant subject of discussion between my wife and I. We are both immigrants to Canada, and both of our parents migrated from their home countries in search for better opportunities (Hers migrated permanently from Spain to France, mine temporarily from Colombia to Venezuela).
Since my first migration when I was 8 years old, I have always felt extremely privileged to be welcomed in a new country. When I migrated on my own to Canada, I was extremely grateful, and l...
2
Yes, this sounds completely obvious to me.
Of course, learning languages takes time, and may be more difficult for older people. So I wouldn't expect fluent speech from the start, and maybe from the older generation even in a year or two -- just a gesture of trying. The important thing is that they do not isolate their kids and themselves from the local society behind the language barrier. Become bilingual.
Heck, if I had to emigrate somewhere, I would want my kids to speak the local language, because it expands their options. Not even as a sign of respect or thanks to the locals, but for completely selfish reasons. It will be better for my kids to have more job opportunities, more social opportunities, etc. Not doing so would be like putting my kids in a prison for a lifetime -- limiting their social interaction to the few neighbors who speak the same language.
Basically, be able to fit in the mainstream culture, and keep everything else on the level of "hobbies, that shouldn't annoy my neighbors".
.
There are some steps the welcoming country can do for the immigrants, such as organize cheap language courses for them. But it's on the immigrants to take that opportunity.
Rough preparation for a future where AI keeps improving and changes society as we know it:
Stay on top of developments, both on how I as an individual can use the tech to be more productive / efficient at both work and life, as well as how others are using it.
Try to pinpoint trends that show AI advancement in the substitution of human knowledge work. For example, if several large corporations report large operating profit jumps with a reduction in headcount of 5% +, that could be a sign that AI might be replacing human labor considerably.
Have a
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If the US introduces UBI (likely mainly through taxation of AI companies), it will only be distributed to US Americans. Which would indeed mean that people which are not citizens of the country that wins the AI race, likely the US, will become a lot poorer than US citizens. Because most of the capital gets distributed to the winning AI company/companies, and consequently to the US.
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I am aware of that, and as a Canadian, this concerns me.
I am looking for people to challenge my draft thesis. See below:
Bitcoin's reliance on Proof-of-Work makes it inherently energy-intensive. As AI development accelerates, it will demand an increasingly large share of global energy and infrastructure resources. This creates a potential conflict: both industries need significant capital investment and specialized workforces.
My thesis posits that within the next five years, if the demand for AI infrastructure continues to grow exponentially, it will drive up energy costs and potentially divert capital away from...
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Bitcoin mining uses specialized ASICs, but modern AI uses GPUs (or similar). ASICs can’t run AI workloads, and GPUs can’t hash SHA-256 competitively. Bitcoin miners cannot simply “switch” their fleet to AI. They would need entirely new hardware. They have no major advantage over anyone else with capital to invest and most AI workloads are owned by megacorps, not independent miners looking to join in the profits.
Electricity markets are local, and AI companies are increasingly bringing on new energy generation to help with the energy stress. Even with a massive growth of energy demand for AI, there will still be parts of the world with cheap electricity since data centers are clustered in a handful of global locations.
Drops in hashrate are not unprecedented. In mid-2021, Bitcoin’s hashrate dropped by roughly half when China banned mining. This was far more sudden and precipitous than energy pressures are likely to cause. The network slowed temporarily, difficulty adjusted, miners relocated, and hashrate recovered without a successful 51% attack.
Even during a harsh hashrate decline, amassing a majority of ASIC capacity isn't likely feasible. Only a small fraction of the hashrate is rentable and it's not easy to quickly accumulate vast quantities of ASICs.
It's certainly possible for Bitcoin mining economics to become unfavorable, but it won't likely be directly related to AI, except in certain local areas that are data center hubs (like parts of Texas and Virginia) that are already experiencing strained grids.
This past weekend I have read several takes from prominent accounts on social media saying that because long end US treasury rates have dropped and will continue to drop in the near future, businesses will be able to borrow at a lower rate.
These people completely ignore that business borrowing rates are a component of the reference rate + a credit spread. While it is true that the reference rate has dropped in the past few days, credit spreads have materially increased.
For companies with lower credit ratings, it is more expensive to borrow today than it wa...
Hot macroeconomic take:
Bessent / Trump are purposely lowering domestic demand via a combination of Doge + Psychology.
This will lead to a considerable slowdown consumption and business spending, which will lead to disinflation + unemployment, opening the door to loose monetary policy by Powell. I am talking about 5+ rate cuts plus a QT pause.
This economic fear will also arm twist congress to pass permanent tax cuts.
SPY finishes the year positive.
This week, President Trump could send a powerful and stabilizing signal to financial markets by naming Fed Governor Christopher J. Waller as his nominee for Federal Reserve Chair. Such a move would counter fears of an outsider appointment by selecting an experienced professional with an impeccable resume in monetary economics.
Waller is a Fed insider, having built a distinguished academic career before serving over a decade as the research director at the St. Louis Fed and, since 2020, as a Governor. His entire career points to a policymaker who is rigoro...