What we’re reading (1/4)
“Alan Greenspan Says US Recession Is Likely” (CNN Business). “Former Federal Reserve Chairman Alan Greenspan believes a US recession is the ‘most likely outcome’ of the Fed’s aggressive rate hike regime meant to curb inflation. He joins a growing chorus of economists predicting imminent economic downturn. His views are particularly important. Not only did Greenspan serve five terms as Fed chair under four different presidents between 1987 and 2006, but he was the last chair to successfully navigate a soft landing, in 1994. In the 12 months that followed February 1994 Greenspan nearly doubled interest rates to 6% and managed to keep the economy steady, avoiding recession.”
“Amazon To Lay Off Over 17,000 Workers, More Than First Planned” (Wall Street Journal). “The Seattle-based company in November said that it was beginning layoffs among its corporate workforce, with cuts concentrated on its devices business, recruiting and retail operations. At the time, the company expected the cuts would total about 10,000 people, but a person with knowledge of the issue said the number could change, The Wall Street Journal reported. Thousands of those cuts began last year.”
“Jeff Bezos May Return To Helm Amazon, Says Forecaster Of Double-Digit Stock Market Losses Last Year” (MarketWatch). “It’s still early enough in the year to look at 2023 predictions, so this time we’ll go with one from an analyst who called the market correctly at the end of 2021. ‘The S&P 500 will have its worst year since 2008,’ said Michael Batnick, managing partner at Ritholtz Wealth Management. ‘I predict this year it will fall more than 15%. The combination of high multiples, high inflation, supply chain issues, and the Fed raising interest rates will prove to be too much for investors to handle.’ The S&P 500 dropped 19% last year.”
“Microsoft And OpenAI Working On ChatGPT-Powered Bing In Challenge To Google” (The Information). “Microsoft could soon get a return on its $1 billion investment in OpenAI, creator of the ChatGPT chatbot, which gives humanlike text answers to questions. Microsoft is preparing to launch a version of its Bing search engine that uses the artificial intelligence behind ChatGPT to answer some search queries rather than just showing a list of links, according to two people with direct knowledge of the plans.”
“The Method In The Markets’ Madness” (The Atlantic). “[I]f fundamentals explain a lot of the market’s overall drop, why all the turbulence? Well, the stock market is a kind of prediction machine, and, as Yogi Berra supposedly said, ‘It’s tough to make predictions, especially about the future.’ They’re especially hard to make at the moment, when so much about what’s going to happen next year is genuinely uncertain.”
