📣 Anthropic eyes $40B valuation

Welcome to the Techonomy Barista, where we parse the code of current information. 🧮

What we’re covering today:

1. Anthropic eyes new $40B valuation.

2. Perplexity to take on Google through new ad model.

3. US semiconductor and homebuilder stocks show warning signs.

4. China’s economic reforms may not be enough to boost consumption.

5. Sam Altman’s latest essay on the current ‘Intelligence Age.’

Markets

Economic Calendar

1. Anthropic eyes $40B valuation, seemingly follows OpenAI’s pursuit of raising capital. 💰️ 

Key takeaways:

• Anthropic is exploring a new funding round that could value the company at $30-40 billion - roughly double its previous round from early 2023.

• Its move follows OpenAI's pending deal to raise $5-7 billion at a $150 billion valuation.

• The company projects $800 million in annualized revenue by end of 2024, but faces $2.7 billion in projected losses.

• Anthropic may use an investment bank for the round, signaling another round from corporate investors like it did in 2023 from Google and Amazon.

• It is scheduled to present to investors at Morgan Stanley’s private tech conference in Los Angeles next month.

What this could mean for you:

• An AI arms race on. As Anthropic and OpenAI bulk up their war chests, expect a flood of new AI features for consumers and businesses.

• Automation is the name of the game. We have had a step jump in the way we operate at work and in our personal lives. More funding to foundational AI companies is only going to take automation and efficiency to the next level. 🚀 

2. Perplexity's AI search engine looking at new ad model to challenge Google. 🎯

Key takeaways:

• Perplexity plans to introduce a new advertising model for its AI-powered search engine.

• The company is in talks with brands like Nike and Marriott to implement this new system by end of year along with other premium brands. 📆 

• Perplexity's model will allow brands to bid for "sponsored" questions with AI-generated answers approved by advertisers.

• It positions Perplexity to compete with Google in the digital ad market.

What this could mean for you:

• Perplexity is seen as a welcome competitor by people who don’t prefer to rely on a single solution, as Google has a monopoly in the search engine market.

• With positive reviews about Perplexity’s accurate answers, it is expected that you will save time instead of wading through pages of irrelevant search results.

3. Valuation bubble brewing? Semiconductor and homebuilder stocks show warning signs. 💻🏠

Key takeaways:

• Study defines industry bubble as 100+ percentage point outperformance over 2 years.

• Semiconductor industry has outperformed the market by 176 percentage points in 2 years.

• Homebuilding industry has outperformed by 121 percentage points in the same period. 53% chance of 40% crash when industry outperforms by 100 percentage points.

• Crash probability rises to 80% for 150 percentage point outperformance.

How it may affect the economy:

• A sharp correction in semiconductor and homebuilding sectors could trigger broader market volatility.

• Downturn in the semiconductor industry might slow technological innovation and disrupt supply chains across multiple sectors.

• A crash in the homebuilding sector could lead to job losses in construction and related industries, potentially increasing unemployment rates.

• Reduced activity in these key sectors may lead to decreased consumer spending and business investments.

• If investors lose confidence due to these high-profile sector bubbles bursting, it could tighten credit markets.

4. China's economic band-aid could be too little, too late 🇨🇳💉

Key takeaways:

• China's central bank announced measures to support the weakening economy, including interest rate cuts and lower bank reserve requirements.

• The moves follow downbeat economic data, raising doubts about China's growth trajectory.

• Economists warn these measures may not be enough to repair the housing market or boost consumption.

• The property market downturn has destroyed an estimated $18 trillion in household wealth.

• U.S. Federal Reserve's recent rate cut provides some relief for China's currency pressures.

Bottom Line: China's economy is like a giant trying to dance on eggshells – lots of careful moves, but still cracking under pressure. 🥚💃 

These new measures might be more superficial than a true fix. So, while Beijing is busy rearranging the economic furniture, the rest of the world is watching nervously, hoping they don't accidentally knock over the global growth lamp.

5. “The path to the Intelligence Age is paved with compute, energy, and human will” - Sam Altman.

Key takeaways:

• Altman wrote an essay on AI titled “The Intelligence Age” predicting that the future is marked by massive prosperity and technological advancements.

• He states that deep learning has emerged as a transformative algorithm capable of learning any data distribution.

• AI's capabilities are expected to improve with increased compute and data and predicts superintelligence in a few thousand days.

• AI could lead to breakthroughs in climate solutions, space colonization, and physics discoveries. 🛰️ 

• Potential downsides include labor market disruptions, necessitating proactive measures to maximize benefits and minimize harms.

What this could mean for the industry:

• Traditional software development has already shifted towards AI-assisted coding, forcing programmers to up skill with co-pilots to be more efficient.

• The energy sector might face increased demand and pressure to scale up sustainable solutions to power the massive computational needs of AI systems.

• Education and training providers may need to rapidly evolve curriculum to prepare the workforce for AI-integrated roles across various industries.

• Regulatory bodies and policymakers will likely face challenges in creating frameworks that balance innovation with ethical concerns and potential societal impacts of AI.

Other stories:

AI

Amazon AI looks to get as strong as its rivals OpenAI, Google and Microsoft.

Crypto scammers hack Open AI’s press account on X. 💻💸

AI helps uncover 303 new geoglyphs in Nazca desert in Peru.

The ChatGPT Advanced Voice mode rollout is starting for Plus users.

Tech

TikTok to shut down its music streaming business.

Attention, spoiled software engineers: learn some humility from Google’s go language. 💻

X to make public posts visible to the accounts you’ve blocked.

Google to bring its smart home panel to TVs with the Android TV operating system.

Startup

Benefits startup Jump raises $12M to help freelancers the same benefits as employees.

UC Berkeley’s startup that helps AI models remember users and conversations raises $10M and is out of stealth.

Business

Intel delays $30 billion investment in Germany 💰🇩🇪 amid financial troubles.

Toyota expands share buyback plans 📈💵 to address share price drop.

Musk gives in, X lives again in Brazil.

China’s auto stocks soars 🚗📈 despite U.S. proposal to ban Chinese car parts.

Former FTX exec. Caroline Ellison faces possible jail time.

US Politics

Donald trump will not run in 2028 if he loses this election.

Biden and Harris meet Emirati President in DC.

Top Economies (non-US)

Australia’s Central Bank holds rates steady, bucking the global trend.

India declines to join world’s largest trade deal, accuses China of opaque trade practices.

Op-ed: UK’s budget woes rooted in the 2008 financial crisis. 📉

Bank of Japan keeps rates steady. 📊

Germany’s data revamp fiasco leaves economists ‘Flying Blind’ as federal statistical office halts key releases.

Fascinating

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