What we’re reading (10/3)
“The Hidden Cost Of Playing The Stock Market’s Slot Machine” (Wall Street Journal). “Exchange-traded funds that seek to magnify the daily gains or losses of a single stock are generating returns that look like typos. Defiance Daily Target 2X Long RGTI, which aims to double the daily return of quantum-computer firm Rigetti Computing, is up roughly 1,000%. It’s only been around since March 31. Tradr 2X Long QBTS Daily targets twice the daily results of computing firm D-Wave Quantum. It has gained more than 700% since launching in late April. Those returns are net of all costs, including annual expenses that typically run 1% to 1.3%—but what buyers might not realize is how high those costs can go. On some of these funds, undisclosed costs can sometimes hit a 15% to 20% annualized rate.”
“The US Stock Market Has Been Exceptional, But One Region Made It Phenomenal” (Morningstar). “Currently, the six largest businesses in the world, as measured by stock market capitalization, are headquartered not merely in the US, but in just two of its 50 states.”
“AI Needs Data Centers—And People To Build Them” (City Journal). “[C]oders and computer programmers, including those with AI skills, account for less than 1 percent of all STEM jobs. But the surprise for our times is how those coders and computer scientists are driving a massive increase in demand for construction workers.”
“Amazon Founder Jeff Bezos Says AI Bubble Is Real, But So Is The Technology” (Yahoo! Finance). “Add Amazon founder Jeff Bezos to the growing list of people calling Wall Street's AI craze a bubble. During a conversation at Italian Tech Week, Bezos said the artificial intelligence hype cycle is pushing investors to spend billions on both good and bad ideas. Despite that, Bezos said he believes AI is a very real product that will impact companies across industries and society more broadly.”
“Netflix Stock Logs Biggest Weekly Drop Since April As Elon Musk Calls For Users To Cancel Subscriptions” (Yahoo! Finance). “The drop comes as Musk amps up calls for a boycott, urging his 227 million followers on X to cancel their Netflix subscriptions and accusing the streamer of pushing alleged transgender messaging in kids’ shows. Over the past several days, Musk has posted or reposted a series of messages criticizing Netflix’s programming: ‘Cancel Netflix for the health of your kids,’ Musk wrote on Tuesday.”
