What we’re reading (5/9)
“ChatGPT Is Causing A Stock-Market Ruckus” (Wall Street Journal). “Investors are gauging the extent to which AI’s arrival will upend companies, industries and contemporary business practices—and placing bets accordingly. That has sent stocks swinging wildly in both directions: Chip maker Nvidia’s shares are surging, while shares of study-materials company Chegg have plummeted. Enthusiasm for the potential of AI is one reason big tech companies are among this year’s strongest performers.”
“Generative AI And Firm Values” (Eisfeldt, Schubert, and Zhang, NBER). “Using Artificial Minus Human portfolios that are long firms with higher exposures and short firms with lower exposures, we show that higher-exposure firms earned excess returns that are 0.4% higher on a daily basis than returns of firms with lower exposures following the release of ChatGPT. Although this release was generally received by investors as good news for more exposed firms, there is wide variation across and within industries, consistent with the substantive disruptive potential of Generative AI technologies.”
“Banking Stress Emerges As Major Concern For Financial Stability” (Washington Post). “Banking sector stress has shot up as a concern for stability in the financial system, according to the latest Federal Reserve survey on major risks to the economy.”
“Paramount Cuts 25 Percent Of Staff From TV Networks, MTV News Shutting Down” (The Hollywood Reporter). “Chris McCarthy’s swath of Paramount Global is laying off 25 percent of its domestic team today. The reduction comes on the heels of integrating Showtime into his cable and streaming purview, which will be consolidated into two functions going forward. There are ‘studios,’ which now combine Showtime with MTV Entertainment Studios, and ‘networks,’ which will merge nine separate teams into one portfolio group. The majority of the cuts are being felt by the latter group, with certain units, including MTV News, being shut down altogether.”
“Home Prices Fell In Third Of The U.S. During First Quarter” (Wall Street Journal). “Home prices fell in more parts of the U.S. than they have in over a decade during the first quarter, when nearly a third of metro areas posted annual price declines, the National Association of Realtors said Tuesday.”
