Edward Conard

Top Ten New York Times Bestselling Author

  • “…a must-read for serious students of economic policy.” - Glenn Hubbard, Dean, Columbia Business School, and former Chairman of the Council of Economic Advisers
  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
  • “…a comprehensive explanation of the modern economy.” - Julian Robertson, Founder, Tiger Management
  • “Unintended Consequences offers deep and well-argued analyses on almost every issue.” - The New York Times
  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
  • “Unintended Consequences is far smarter and more thought-provoking than most economics written for the general public” - Greg Mankiw, Harvard University, Former Chairman of the Council of Economic Advisors
  • “…serious thinking for serious thinkers. …a thought-provoking blueprint for growing middle- and working-class incomes.” - Mitt Romney, former Governor of Massachusetts
  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
  • “A full-throated defense of economic dynamism.” - The Wall Street Journal
  • “…serious thinking for serious thinkers. …a thought-provoking blueprint for growing middle- and working-class incomes.” - Mitt Romney, former Governor of Massachusetts
  • “…a very valuable contribution.” - Larry Summers, former Secretary of the Treasury and director of the National Economic Council, president emeritus, Harvard University
Upside of Inequality Oxford Unintended Consequences

Macro Roundup


Tuesday, May 9, 2023

AI Summary. Researchers estimate US households accumulated about $2.1tn in excess savings above the pre-pandemic trend before drawing them down, with cumulative drawdowns of $1.6tn leaving roughly $500bn remaining. If recent drawdown rates persist, the authors project remaining excess savings would continue supporting household spending for several more months.

Hamza Abdelrahman and Luiz Oliveira Federal Reserve Bank of San Francisco
Date Posted:

According to a new analysis from the @sffed there is still $500B of excess personal savings in the economy which could support consumer spending through Q4 of this year.

How much pandemic excess savings remains to support household spending?

Core argument: The authors estimate pandemic excess savings peaked at about $2.1 trillion in nominal terms through August 2021, after which aggregate personal savings fell below the pre-pandemic trend.

We estimate that accumulated excess savings, in nominal terms, totaled around $2.1 trillion through August 2021, when it peaked (green area). After August 2021, aggregate personal savings dipped below the pre-pandemic trend, signaling an overall drawdown of pandemic-related excess savings. The drawdown to on household savings was initially slow, averaging $34 billion per month from September to December 2021. It then accelerated, averaging about $100 billion per month throughout 2022, before moderating slightly to $85 billion per month in the first quarter of 2023. Cumulative drawdowns reached $1.6 trillion as of March 2023 (red area), implying there is approximately $500 billion of excess savings remaining in the aggregate economy. Should the recent pace of drawdowns persist—for example, at average rates from the past 3, 6, or 12 months—aggregate excess savings would likely continue to support household spending at least into the fourth quarter of 2023.

Takeaways by Macro Roundup® AI

  1. The authors estimate pandemic excess savings peaked at about $2.1 trillion in nominal terms through August 2021, after which aggregate personal savings fell below the pre-pandemic trend.
  2. Cumulative drawdowns of excess savings reached $1.6 trillion as of March 2023, leaving roughly $500 billion remaining in the aggregate economy, by the authors' estimates.
  3. Monthly drawdowns of household savings averaged $34 billion from September to December 2021, accelerated to about $100 billion per month throughout 2022, and moderated to $85 billion per month in the first quarter of 2023.

AI Summary. Total outstanding private credit was split about evenly between businesses, owing $19.9tn, and households, owing $19.0tn. Combined nonfinancial business and household debt grew more slowly than nominal GDP, producing a modest decline in the debt-to-GDP ratio driven by a larger drop in the household ratio than the business ratio.

Federal Reserve Staff Federal Reserve Board
Date Posted:

According to new Financial Stability Report the private sector is deleveraging relative to GDP.

Is private debt growing more slowly than the economy?

Core argument: Total outstanding private credit at the end of the fourth quarter of 2022 was split about evenly between businesses, owing $19.9 trillion, and households, owing $19.0 trillion.

At the end of Q4 2022 total outstanding private credit was split about evenly between businesses and households, with businesses owing $19.9 trillion and households owing $19.0 trillion. The combined total debt of nonfinancial businesses and households grew more slowly than nominal GDP since the November report, leading to a modest decline in the debt-to-GDP ratio, which moved back closer to the level that had prevailed for much of the decade before the pandemic. The decline in the overall ratio was driven by a larger decline in household debt-to-GDP ratio compared to the business debt-to- GDP ratio.

Takeaways by Macro Roundup® AI

  1. Total outstanding private credit at the end of the fourth quarter of 2022 was split about evenly between businesses, owing $19.9 trillion, and households, owing $19.0 trillion.
  2. Combined nonfinancial business and household debt grew more slowly than nominal GDP since the November report, producing a modest decline in the debt-to-GDP ratio back toward the level that prevailed for much of the decade before the pandemic.
  3. The decline in the overall debt-to-GDP ratio was driven by a larger decline in the household ratio than in the business ratio.

AI Summary. India's manufactured exports, while about a tenth of China's, exceeded those of all other emerging markets except Mexico and Vietnam, with electronics exports tripling to $23bn and India's share of global smartphone production projected to rise from 9% to 19%. Foreign direct investment averaged $42bn annually, double the level of under a decade earlier.

Philip Wen, Vibhuti Agarwal and Greg Ip Wall Street Journal
Date Posted:

Counterpoint Technology Market Research projects that India will manufacture 19% of the world’s smartphones this year, up from 9% in 2016. Overall Indian electronic exports have tripled since 2018 to $23B through March of this year.

Is India emerging as a manufacturing rival to China?

Core argument: India's manufactured exports were barely a tenth of China's in 2021 but exceeded those of all other emerging markets except Mexico and Vietnam, according to World Bank data.

Nonetheless, after decades of disappointment, India is making progress. Its manufactured exports were barely a tenth of China’s in 2021, but they exceeded all other emerging markets except Mexico’s and Vietnam’s, according to World Bank data. The biggest gains have been in electronics, where exports have tripled since 2018 to $23 billion in the year through March. India has gone from making 9% of the world’s smartphone handsets in 2016 to a projected 19% this year, according to Counterpoint Technology Market Research. Foreign direct investment into India averaged $42 billion annually from 2020 to 2022, a doubling in under a decade, according to central bank figures.

Takeaways by Macro Roundup® AI

  1. India's manufactured exports were barely a tenth of China's in 2021 but exceeded those of all other emerging markets except Mexico and Vietnam, according to World Bank data.
  2. India's electronics exports tripled since 2018 to $23 billion in the year through March, and its share of world smartphone handset production is projected at 19% this year, up from 9% in 2016, according to Counterpoint Technology Market Research.
  3. Foreign direct investment into India averaged $42 billion annually from 2020 to 2022, a doubling in under a decade, according to central bank figures.

AI Summary. Volkswagen relies on China for at least half its annual profits, but its flagship VW brand has been displaced as China's best-selling car by BYD and holds just 2% of the electric vehicle market, ninth place, versus nearly 40% for BYD and over 10% for Tesla.

Edward White and Patricia Nilsson Financial Times
Date Posted:

China’s BYD has overtaken VW as the top-selling brand in China, and Chinese carmakers are outselling foreign rivals with 52% share of total sales 2023, up from 47% in 2022. @FT

Are foreign automakers losing their dominance in China's car market?

Core argument: Volkswagen depends on China for at least half of its annual profits, which reached €22bn last year, and sells more cars in China than any other company.

Volkswagen depends on China for at least half of its annual profits, which last year reached €22bn. While the sprawling German group, which today includes Porsche and Audi, sells more cars in China than any other company, its flagship VW brand was recently dethroned as the country’s best-selling car by BYD, the Shenzhen-based conglomerate backed by Warren Buffett. The German company is falling behind in the fast-growing electric car segment, where the VW brand sits in ninth place with a market share of just 2 per cent. BYD, which holds the top spot, has nearly 40 percent and Elon Musk’s Tesla, in second, has more than 10 per cent. Chinese makers of electric vehicles, which include plug-in hybrid and battery-powered cars, dominate in their own market and are also expanding aggressively overseas. China overtook Germany in auto exports in 2022 and is set to eclipse Japan as the world’s biggest car exporter this year.

Takeaways by Macro Roundup® AI

  1. Volkswagen depends on China for at least half of its annual profits, which reached €22bn last year, and sells more cars in China than any other company.
  2. Volkswagen's flagship VW brand ranks ninth in China's electric car market with a 2 per cent share, behind BYD with nearly 40 per cent and Tesla with more than 10 per cent, and BYD has dethroned it as the country's best-selling car.
  3. China overtook Germany in auto exports in 2022 and is set to eclipse Japan as the world's biggest car exporter this year, as Chinese electric-vehicle makers expand aggressively overseas.

AI Summary. Italy's government is favoring an exit from China's Belt and Road Initiative, though no final decision has been made, and its participation renews automatically unless Rome actively withdraws. Italy is the only Group of Seven country in the pact, which has funded $900bn in infrastructure projects globally.

Chiara Albanese and Alessandro Speciale Bloomberg
Date Posted:

Italy has signaled to the United States that it is likely to exit China’s Belt and Road Initiative by the end of the year. @markets

Will Italy withdraw from China's Belt and Road Initiative?

Core argument: Italian Prime Minister Giorgia Meloni told US House Speaker Kevin McCarthy in Rome that her government is favoring an exit from China's Belt and Road Initiative, though a final decision has not been taken, according to people present at the talks.

Italian Prime Minister Giorgia Meloni reassured US House Speaker Kevin McCarthy during a meeting in Rome last week that while a final decision hasn’t been taken, her government is favoring an exit from its role in China’s massive Belt and Road Initiative, according to people present at the talks. Italy signed onto the infrastructure initiative in 2019 when Giuseppe Conte was premier, becoming the only Group of Seven country to become part of the deal. Participation will automatically renew in 2024 unless Rome actively exits the agreement. China’s Belt and Road Initiative has funded $900 billion in infrastructure projects globally.

Takeaways by Macro Roundup® AI

  1. Italian Prime Minister Giorgia Meloni told US House Speaker Kevin McCarthy in Rome that her government is favoring an exit from China's Belt and Road Initiative, though a final decision has not been taken, according to people present at the talks.
  2. Italy signed onto the Belt and Road Initiative in 2019 under then-premier Giuseppe Conte, becoming the only Group of Seven country to join the deal.
  3. Italy's participation in the Belt and Road Initiative, which has funded $900 billion in infrastructure projects globally, renews automatically in 2024 unless Rome actively exits the agreement.

AI Summary. Across 17 countries, suicide rates among girls aged 10-19 rose from an average of 3.0 per 100,000 people to 3.5, while the higher rate among boys, at 6.1 per 100,000, barely changed. Hospitalisations for self-harm among teenage girls climbed in all 11 countries with data, by an average of 143%, versus 49% for boys.

Economist Staff The Economist
Date Posted:

In seventeen advanced economies the self-harm rate for teenage girls is up 143% since 2011. @TheEconomist

Are suicide and self-harm rates rising faster among teenage girls than boys?

Core argument: Across 17 countries, suicide rates among girls aged 10–19 rose from an average of 3.0 per 100,000 in 2003 to 3.5 per 100,000 in 2020, even as overall suicide rates fell.

We focused on suicides and hospitalisations for self-harm among 17 countries.  Both indicators look worrying for girls. Suicide rates have been falling overall, but girls—who kill themselves less often than other groups—are an exception. Among girls aged 10-19, suicide rates rose from an average of 3.0 per 100,000 people in 2003 to 3.5 per 100,000 in 2020. The rate among boys, although higher at 6.1 per 100,000 population, has barely changed. Girls engage in more non-fatal self-harm, like cutting, than boys do. This measure shows even steeper increases. For teenage girls, rates of hospitalisation for self-harm have climbed since 2010 in all 11 countries with available data, by an average of 143%. Boys’ average rise was 49%.

Takeaways by Macro Roundup® AI

  1. Across 17 countries, suicide rates among girls aged 10–19 rose from an average of 3.0 per 100,000 in 2003 to 3.5 per 100,000 in 2020, even as overall suicide rates fell.
  2. Hospitalisation rates for self-harm among teenage girls climbed since 2010 in all 11 countries with available data, by an average of 143%, compared with an average rise of 49% for boys.
  3. Boys have a higher suicide rate than girls at 6.1 per 100,000, but that rate has barely changed, while girls engage in more non-fatal self-harm, such as cutting, than boys do.

Wednesday, May 10, 2023

AI Summary. Core consumer prices rose at a 5.0% annual rate over one month and 5.5% over 12 months, lifted by a rebound in goods prices including a 4.4% rise in used cars and trucks. Shelter cost growth slowed, and a "supercore" measure excluding food, energy, shelter and used cars rose at 1.9%.

Jason Furman @Jasonfurman
Date Posted:

April’s core CPI of 5.0% annualized remains well above target. @jasonfurman

Are rebounding goods prices keeping core inflation elevated as shelter costs slow?

Core argument: Core CPI rose at a 5.0% annualized rate in April, with 3-month, 6-month, and 12-month rates of 5.1%, 4.8%, and 5.5%, according to Jason Furman.

Inflation coming in high again, despite a continued slowdown in shelter growth but because of a (temporary?) rebound in goods prices. The core CPI at an annual rate: 1 month: 5.0% 3 months: 5.1% 6 months: 4.8% 12 months: 5.5%. The favorable interpretation of the April data is that it was temporarily elevated due to an unusually large increase in goods prices--which had been flat or negative recently. A lot of this was a 4.4% (not annualized) increase in used cars and trucks. Housing looms large in the CPI. Shelter cost growth slowed again this month, although that was because hotel prices fell 3.4%. But even excluding that rent and owner's equivalent rent were slower than they generally have been. But more slowing likely ahead. "Supercore", which excludes food, energy, shelter and used cars, was up at only a 1.9% annual rate in April. That is the slowest rate since the takeoff of inflation in early 2021.

Takeaways by Macro Roundup® AI

  1. Core CPI rose at a 5.0% annualized rate in April, with 3-month, 6-month, and 12-month rates of 5.1%, 4.8%, and 5.5%, according to Jason Furman.
  2. Furman describes the favorable reading of April data as temporary elevation from an unusually large rise in goods prices, including a 4.4% not-annualized increase in used cars and trucks, after goods had been flat or negative.
  3. "Supercore" CPI, excluding food, energy, shelter, and used cars, rose at a 1.9% annual rate in April, the slowest since inflation took off in early 2021, while shelter growth slowed as hotel prices fell 3.4%.

AI Summary. Productivity measured as GDP per worker was flat economy-wide in one year, with output up 6% and payrolls up 5%, then fell as GDP growth slowed to 1% while payrolls rose 3%. Weak goods-producing productivity was broad based across mining, construction, and manufacturing, with output down 3% against payrolls up 4%.

Thomas Klitgaard and Ethan Nourbash Federal Reserve Bank of New York
Date Posted:

Productivity declined in 2022. This was driven by the goods-producing sector, where output was up 1% versus payrolls increasing 3%. @NewYorkFed

How did output per worker shift across sectors?

Core argument: Productivity, measured as GDP per worker, was flat for the whole economy in 2021 as output rose 6% over four quarters while payrolls rose 5%.

Productivity, measured here by GDP per worker, can be used to evaluate how well employment tracked output during the pandemic period. Productivity was flat for the whole economy in 2021 as both payrolls and the economy grew at fast rates. Specifically, output rose 6% over the four quarters and payrolls rose 5% over the same period. By sector, services output was up 8% versus payrolls up 6% (higher productivity), goods-producing output was up 1% versus payrolls increasing 3% (lower), and government output was up 1% versus payrolls up 2% (lower). In 2022, overall productivity finally fell as GDP growth slowed to 1% while payrolls rose 3%. By sector, services GDP grew 2% versus payrolls up 4%, goods-producing output fell 3% versus payrolls up 4%, and government output and payrolls both grew 1%.  The depressed productivity for the goods-producing sectors was broad based, with low readings for mining, construction, and manufacturing.

Takeaways by Macro Roundup® AI

  1. Productivity, measured as GDP per worker, was flat for the whole economy in 2021 as output rose 6% over four quarters while payrolls rose 5%.
  2. Overall productivity fell in 2022 as GDP growth slowed to 1% while payrolls rose 3%, with goods-producing output down 3% against a 4% payroll gain.
  3. Depressed goods-producing productivity was broad based, with low readings for mining, construction, and manufacturing, while services GDP grew 2% versus payrolls up 4%.

AI Summary. The Federal Reserve's survey of senior loan officers shows bank lending standards and loan demand indicators at or near 2008 levels, and because the survey covers only large banks, credit conditions at small and medium-sized banks are likely tightening even more.

Torsten Sløk Apollo
Date Posted:

In a Fed survey of large bank loan officers completed after the SVB collapse but prior to First Republic finds lending standards have tightened to 2008 levels. Torsten Sløk @apolloglobal

Are bank credit conditions as tight as in 2008?

Core argument: Across all indicators of loan supply and loan demand, the Fed's Senior Loan Officer Survey shows bank credit conditions at or close to 2008 levels, based on banks' reported tightening of lending standards for firms and households.

The survey asks banks if they have tightened lending standards for firms and households relative to last quarter, and across all indicators for demand for loans and supply of loans, we are now at or close to 2008 levels. In addition, the first sentence in the notes to the Fed’s Senior Loan Officer Survey shows that it only covers large banks out of the roughly 4,000 banks in the US, so credit conditions in small and medium-sized banks are likely tightening even more than seen in the charts below. The bottom line for markets is that with inflation still at 5%, well above the FOMC’s 2% inflation target, and the Fed not cutting rates anytime soon, credit conditions will continue to tighten, and as a result, a recession is coming that could be deeper or longer than the consensus currently expects.

Takeaways by Macro Roundup® AI

  1. Across all indicators of loan supply and loan demand, the Fed's Senior Loan Officer Survey shows bank credit conditions at or close to 2008 levels, based on banks' reported tightening of lending standards for firms and households.
  2. The Senior Loan Officer Survey covers only large banks out of roughly 4,000 US banks, and credit conditions at small and medium-sized banks are likely tightening more than the survey shows.
  3. With inflation at 5% against the FOMC's 2% target and the Fed not cutting rates soon, credit conditions will continue to tighten and a recession is coming that could be deeper or longer than consensus expects.

AI Summary. Insuring US Treasuries against default has become more expensive than insuring bonds of Greece, Mexico and Brazil, countries that have defaulted multiple times and carry far lower credit ratings. One-year euro-denominated US credit default swaps traded at 166 basis points, above levels seen in earlier debt-ceiling standoffs.

Sujata Rao-Coverley and Denitsa Tsekova Bloomberg
Date Posted:

American CDS spreads are currently more expensive than insurance against a Mexican or Greek default. @markets.

Is default insurance on US debt costing more than lower-rated countries?

Core argument: One-year euro-denominated US credit default swaps traded at 166 basis points Wednesday, near a record high and above levels seen during the 2011 and 2013 debt-ceiling standoffs.

Mounting investor anxiety about the prospect of a first-ever US default has made it more expensive to insure Treasuries than the bonds of — among others — Greece, Mexico and Brazil, which have defaulted multiple times and have credit ratings many rungs below that of the US’s AAA. The imbroglio has fueled a surge in demand for euro-denominated US credit default swaps, the most actively traded. These contracts against a default over the next year traded at 166 basis points Wednesday, near a record high and surpassing the levels during previous debt-ceiling standoffs in 2011 and 2013. The trade has taken off due to a derivatives market quirk that will allow holders to reap handsome returns in the event of default. Their payoff will equal the difference between the market value and par value of the underlying asset, an attractive proposition when long-dated Treasury bonds are trading particularly cheap. The potential payout could exceed 2,400%, according to Bloomberg calculations.

Takeaways by Macro Roundup® AI

  1. One-year euro-denominated US credit default swaps traded at 166 basis points Wednesday, near a record high and above levels seen during the 2011 and 2013 debt-ceiling standoffs.
  2. Insuring Treasuries against default costs more than insuring the bonds of Greece, Mexico and Brazil, which have defaulted multiple times and carry credit ratings many rungs below the US's AAA.
  3. A derivatives market quirk pays credit default swap holders the difference between the market value and par value of the underlying asset, a payout that could exceed 2,400% with long-dated Treasuries trading cheap, according to Bloomberg calculations.

AI Summary. Wendy's is automating drive-through ordering with an artificial-intelligence chatbot built on natural-language software from Google and trained to understand the many ways customers order off the menu.

Angus Loten Wall Street Journal
Date Posted:

The fast food chain Wendy’s is automating its drive-through service with an AI powered chatbot using natural-language software developed by Google.

The fast food chain Wendy’s is automating its drive-through service with an AI powered chatbot using natural-language...

Can an AI chatbot take fast-food drive-through orders?

Core argument: Wendy's is automating drive-through order taking with an AI chatbot built on natural-language software developed by Google and trained to understand the many ways customers order off the menu.

Wendy’s is automating its drive-through service using an artificial-intelligence chatbot powered by natural-language software developed by Google and trained to understand the myriad ways customers order off the menu. The Dublin, Ohio-based fast-food chain’s chatbot will be officially rolled out in June at a company-owned restaurant in Columbus, Ohio, Wendy’s said.

Takeaways by Macro Roundup® AI

  1. Wendy's is automating drive-through order taking with an AI chatbot built on natural-language software developed by Google and trained to understand the many ways customers order off the menu.
  2. Wendy's said the chatbot will be officially rolled out in June at a company-owned restaurant in Columbus, Ohio.

AI Summary. Goldman Sachs argues that the combination of labour cost savings, new job creation, and a productivity boost for non-displaced workers raises the possibility of a labour productivity boom, as followed the electric motor and personal computer. It estimates generative AI might raise annual US labour productivity growth by 1.5 percentage points, with larger gains in high-income countries.

Martin Wolf Financial Times
Date Posted:

Citing a Goldman Sachs research note, @martinwolf_ argues that AI diffusion is likely to be associated with an increase in productivity.

Will generative AI produce a labor productivity boom?

Core argument: Goldman Sachs estimates that generative AI might raise annual US labour productivity growth by 1.5 percentage points, with the surge larger in high-income countries than in developing ones.

An analysis by Goldman Sachs argues that the “combination of significant labour cost savings, new job creation, and a productivity boost for non-displaced workers raises the possibility of a labour productivity boom”. This would be similar to what ultimately followed the emergence of the electric motor and personal computer. The study estimates that generative AI, in particular, might raise annual growth of labour productivity in the US by 1.5 percentage points. The surge would be bigger in high-income countries than developing ones, though timing is uncertain.

Takeaways by Macro Roundup® AI

  1. Goldman Sachs estimates that generative AI might raise annual US labour productivity growth by 1.5 percentage points, with the surge larger in high-income countries than in developing ones.
  2. Goldman Sachs argues that the combination of significant labour cost savings, new job creation, and a productivity boost for non-displaced workers raises the possibility of a labour productivity boom.
  3. Goldman Sachs likens the potential productivity boom to what ultimately followed the emergence of the electric motor and the personal computer, while noting that the timing remains uncertain.

AI Summary. Microsoft has agreed to buy fusion-generated electricity from startup Helion Energy in what is believed to be the first commercial fusion power agreement, even as many experts view fusion as decades away. Helion committed to begin producing fusion electricity within about five years and to supply at least 50 megawatts or pay penalties.

Jennifer Hiller Wall Street Journal
Date Posted:

Microsoft has signed a contract with Helion to buy at least 50 megawatts of electricity generated by fusion starting in 2028.

Microsoft has signed a contract with Helion to buy at least 50 megawatts of electricity generated by fusion starting in 2028.

Is commercial fusion power closer than experts believe?

Core argument: Microsoft agreed to buy fusion-generated electricity from startup Helion Energy within about five years, in what is believed to be the first commercial agreement for fusion power.

Many experts believe fusion power remains decades away. Microsoft thinks it could be just around the corner. In a deal that is believed to be the first commercial agreement for fusion power, the tech giant has agreed to purchase electricity from startup Helion Energy within about five years. Helion, which is backed by OpenAI founder Sam Altman, committed to start producing electricity through fusion by 2028 and target power generation for Microsoft of at least 50 megawatts after a year or pay financial penalties.

Takeaways by Macro Roundup® AI

  1. Microsoft agreed to buy fusion-generated electricity from startup Helion Energy within about five years, in what is believed to be the first commercial agreement for fusion power.
  2. Helion Energy committed to begin producing electricity through fusion by 2028 and to target at least 50 megawatts of generation for Microsoft after a year, or pay financial penalties.
  3. Many experts believe fusion power remains decades away, while Microsoft and Helion Energy, backed by OpenAI founder Sam Altman, expect it much sooner.

AI Summary. Physicists using the quantum computing company Quantinuum's H2 processor synthesized and manipulated non-abelian anyons, particles that retain records of their movement through space and time, in a novel phase of quantum matter. Because those records are nearly indestructible, researchers argue such particles could offer a promising platform for building error-tolerant quantum computers.

Charlie Wood Quanta Magazine
Date Posted:

Physicists have created objects that retain a memory of their past, a step towards “error-tolerant quantum computers.” @QuantaMagazine

Can particles that remember their paths enable error-tolerant quantum computers?

Core argument: Physicists working with Quantinuum used the company's newly unveiled H2 processor to synthesize and manipulate non-abelian anyons in a novel phase of quantum matter.

Physicists working with the company Quantinuum announced that they had used the company’s newly unveiled, next-generation H2 processor to synthesize and manipulate non-abelian anyons in a novel phase of quantum matter. Their work follows a preprint posted last fall in which researchers with Google celebrated the first clear intertwining of non-abelian objects, a proof of concept that information can be stored and manipulated in their shared memory. Together, the experiments flex the growing muscle of quantum devices while offering a potential glimpse into the future of computing: By maintaining nearly indestructible records of their journeys through space and time, non-abelian anyons could offer the most promising platform for building error-tolerant quantum computers.

Takeaways by Macro Roundup® AI

  1. Physicists working with Quantinuum used the company's newly unveiled H2 processor to synthesize and manipulate non-abelian anyons in a novel phase of quantum matter.
  2. Researchers with Google reported in a preprint the first clear intertwining of non-abelian objects, a proof of concept that information can be stored and manipulated in their shared memory.
  3. By maintaining nearly indestructible records of their journeys through space and time, non-abelian anyons could offer the most promising platform for building error-tolerant quantum computers.