Edward Conard

Top Ten New York Times Bestselling Author

  • “A full-throated defense of economic dynamism.” - The Wall Street Journal
  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
  • “…a very valuable contribution.” - Larry Summers, former Secretary of the Treasury and director of the National Economic Council, president emeritus, Harvard University
  • “…a comprehensive explanation of the modern economy.” - Julian Robertson, Founder, Tiger Management
  • “…reminds us that inequality sends a signal of what society lacks most, in America’s case, entrepreneurship and risk taking.” - Lawrence Lindsey, CEO, The Lindsey Group, former Director of the National Economic Council
  • “Unintended Consequences is full of substance, it is one of the must-read books of the year, and once I finish it I will be giving it a second read through right away.” - Tyler Cowen, Professor, George Mason University
  • “…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 very valuable contribution.” - Larry Summers, former Secretary of the Treasury and director of the National Economic Council, president emeritus, Harvard University
  • “…reminds us that inequality sends a signal of what society lacks most, in America’s case, entrepreneurship and risk taking.” - Lawrence Lindsey, CEO, The Lindsey Group, former Director of the National Economic Council
  • “…a must-read for serious students of economic policy.” - Glenn Hubbard, Dean, Columbia Business School, and former Chairman of the Council of Economic Advisers
  • “Unintended Consequences should be read by anyone who takes for granted the superiority of progressive taxation and has not thought carefully about the trade-offs involved.” - The New Republic
  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
Upside of Inequality Oxford Unintended Consequences

Macro Roundup


Monday, June 29, 2026

AI Summary. Linking patents to scientific papers through shared phrases, the authors find China's innovation has grown markedly more self-reliant across nearly all technology areas the U.S. treats as strategically important. In an aggregate grouping of these areas, the share of patent phrases traced to Chinese-produced articles rose from 2% to 24%, while the U.S.-produced share fell from 31% to 18%.

ZIyu Chen and Christopher Esposito Arxiv
Date Posted:

Using shared scientific phrases to link patents to papers, Chen and Esposito found that the share of phrases found on Chinese-produced articles rose from 2% in 2000 to 24% in 2025, while the share found on US-produced articles dropped from 31% to 18%.

Is China's innovation drawing more on its own science than America's?

Core argument: Across an aggregate grouping of U.S.-designated Critical Technology Areas, the share of scientific phrases in Chinese patents traced to domestically produced articles rose from 2% in 2000 to 24% in 2025, while the U.S.-produced share fell from 31% to 18%.

Linking patents to papers based on shared scientific phrases, we found that the self-reliance of China’s innovation has risen sharply and broadly. This is not an artifact of measurement— it holds when we limit the analysis to high-impact journals, when we analyze highly-precise idea combinations, when we examine China’s largest firms and top universities, and when we infer a patent’s scientific content from the English-language U.S. filing of the same invention. It is pronounced across nearly all of the technology areas that the U.S. government treats as strategically important, and it is driven by two core processes: China produces science built on older foreign originated ideas at scale, and it originates a rapidly-growing share of the new phrases used in its own inventions. We mapped CNIPA [China National Intellectual Property Administration] patents to Critical Technology Areas (CTAs) and found that the self-reliance of Chinese innovation rose substantially across them (Figure 2). Across an aggregate grouping of CTAs, the share of phrases found on domestically-produced articles rose from 2% in 2000 to 24% in 2025, while the share found on U.S.-produced articles dropped from 31% to 18%. Only in 3 fields (Biotechnology, Quantum Technology, and High Performance Computing) were such phrases more likely to be found on U.S.-produced articles, and even then these gaps were small and shrinking rapidly.

Takeaways by Macro Roundup® AI

  1. Across an aggregate grouping of U.S.-designated Critical Technology Areas, the share of scientific phrases in Chinese patents traced to domestically produced articles rose from 2% in 2000 to 24% in 2025, while the U.S.-produced share fell from 31% to 18%.
  2. The authors attribute China's rising innovation self-reliance to two processes: China produces science built on older foreign-originated ideas at scale, and it originates a rapidly growing share of the new scientific phrases used in its own inventions.
  3. Only in biotechnology, quantum technology, and high performance computing were phrases in Chinese patents more likely to appear in U.S.-produced articles, and the authors report those gaps as small and shrinking rapidly.

Related Articles:

  • China and the Future Of Science — China graduates about 5x as many medical and biomedical students as the US each year, 7x as many engineers, and nearly double the number of science and engineering PhDs, while one-sixth to one-fifth of US science and engineering graduates are themselves Chinese. One study found returning Chinese scientists lead-author 2.5x more papers than peers who stay in the US.
  • How China Is Outperforming the United States in Critical Technologies — The Australian Strategic Policy Institute's Critical Technology Tracker finds China leads in 57 of 64 critical technology categories while the United States leads in 7, and that China surpasses the United States in top-tier scientific publications across all 8 technology domains. In energy and environment China accounts for 46% of top-tier publications versus 10% for the United States.
  • The US Is The World’s Science Superpower — But For How Long? — International students on temporary visas received more than a third of US science and engineering doctorates, including 59% in computer science, with most coming from China and India, and 77% of Chinese doctoral recipients said they intended to stay in the US. The US hosts 15% of the world's international students, down from 23%.

AI Summary. Earnings growth at the seven largest US technology companies is converging toward that of the rest of the S&P 500 while their valuation premium compresses, which the author argues increasingly favors value stocks over growth stocks.

Torsten Sløk, Rajvi Shah, and Shruti Galwankar Apollo
Date Posted:

The Mag 7’s P/E premium over the rest of the S&P 500 is at its lowest level in more than a decade. Sløk argues “the setup increasingly favors value over growth.”

Are big tech's narrowing earnings advantage shifting markets toward value stocks?

Core argument: The Magnificent 7's earnings growth is converging toward that of the S&P 493, eroding the decade-long case for growth that rested on those seven companies out-earning the rest of the market.

The decade-long case for growth rested on the Mag 7 out-earning everything else, but with earnings growth converging toward the S&P 493 and their valuation premium compressing, the setup increasingly favours value over growth.

Takeaways by Macro Roundup® AI

  1. The Magnificent 7's earnings growth is converging toward that of the S&P 493, eroding the decade-long case for growth that rested on those seven companies out-earning the rest of the market.
  2. The Magnificent 7's valuation premium is compressing, a setup that increasingly favours value over growth.

Related Articles:

  • Opportunities and Expectations: The Present Value of Growth Opportunities in Valuation — A stock's value can be split into steady-state value from current operations and the "present value of growth opportunities" from future value-creating investments, which has averaged 35% of the S&P 500's price historically. Lower shares of price attributed to growth opportunities have been associated with higher subsequent returns, most clearly at the extremes.
  • SpaceX and OpenAI Are Ending Wall Street’s Era of Stock Scarcity — JPMorgan projects that share sales will add roughly $1.5tn of stock to the US equity market over the next two years even after buybacks, which would be the strongest net equity issuance since at least the late 1990s. Equity has grown cheaper relative to debt as a funding source.
  • One Hundred Years in the U.S. Stock Markets — Over a century, U.S. publicly traded stocks generated roughly $91tn in shareholder wealth enhancement, with returns strongly positively skewed and dominated by a relatively small number of high-performing firms. Because most possible outcomes fall below the mean in a skewed distribution, the authors argue financial planning should focus on median outcomes or the full distribution.

AI Summary. U.S. margin debt — money investors borrow from brokerages to buy securities — rose 54% from a year earlier to a record $1.4tn, according to the Financial Industry Regulatory Authority. Assets in leveraged exchange-traded funds, which magnify daily stock moves by two or three times, nearly doubled to a record $220bn.

Jack Pitcher Wall Street Journal
Date Posted:

US margin debt rose 54% y/y to a record $1.4T in May, according to regulatory data. While leverage amplifies returns, it also leaves investors exposed to steeper downsides. Charles Schwab recently tightened margin requirements.

Is investor borrowing to buy stocks at record levels?

Core argument: U.S. margin debt — money investors borrow from brokerages to buy securities — rose 54% from a year earlier to a record $1.4 trillion in May, according to FINRA data.

U.S. margin debt, or what investors borrow from their brokerages to buy securities, rose 54% to a record $1.4 trillion in May from a year earlier, according to FINRA [Financial Industry Regulatory Authority] data. Meanwhile, high-risk leveraged exchange-traded funds that produce double or triple the daily move of underlying stocks are growing rapidly, as is trading in options tied to them. Buyers ranging from hedge funds to teenagers on Robinhood have poured money into leveraged ETFs this year, helping to nearly double the assets in these funds to a record $220 billion between March 30 and June 3, according to FactSet.

Takeaways by Macro Roundup® AI

  1. U.S. margin debt — money investors borrow from brokerages to buy securities — rose 54% from a year earlier to a record $1.4 trillion in May, according to FINRA data.
  2. Assets in leveraged exchange-traded funds, which deliver double or triple the daily move of underlying stocks, nearly doubled to a record $220 billion between March 30 and June 3, according to FactSet.
  3. Buyers of leveraged ETFs range from hedge funds to teenagers on Robinhood, and trading in options tied to these funds is growing rapidly alongside the funds themselves.

Related Articles:

  • The State of the AI Economy — An analysis estimates the AI ecosystem generated $110bn in revenue over 12 months excluding double-counting, with the most recent month annualizing to a $175bn run rate. After separating AI-specific capital spending from the roughly $120bn hyperscalers already spent annually and depreciating compute over 6 years, revenues attributable to hyperscalers roughly cover depreciation.
  • Is It a Bubble? — Transformational technologies have historically generated excessive enthusiasm and investment, producing more infrastructure than needed, asset prices that prove too high, and losses for those funding them, while also accelerating adoption. AI enthusiasm is argued to fit this pattern, with debt financing having the potential to magnify the effects.
  • AI Set to be Largest CapEx Cycle Ever … and Soon Majority Externally Financed — Hyperscaler and data-center investment is tracking toward $1.5tn annually by 2030, which in real terms would exceed the 2005-06 housing boom, the 1990s fiber peak, and the 1882 railroad peak combined. External debt and equity are projected to fund close to 90% of the buildout, making it dependent on credit markets.

AI Summary. Net positioning across major currencies shows markets are broadly long the US dollar. The author argues this bullishness is misplaced because the Federal Reserve is less hawkish than markets assume and falling oil prices should pull inflation down, leaving the dollar at peak strength.

Robin Brooks Robin Brooks Substack
Date Posted:

Noting net positions in the dollar are on the historical high side, and discounting evidence from last week’s FOMC meeting that the Fed is potentially amenable to rate hikes in the face of inflation, Brooks argues the dollar is poised for a fall.

Has the dollar reached peak strength?

Core argument: Net positioning across the world's major currencies shows markets long the Dollar across the board, a degree of Dollar bullishness the author describes as among the strongest seen in a long time.

The black line in the chart summarizes net positioning against the Dollar across the world’s major currencies. When that line is negative, as it is now, markets are long the Dollar across the board. Markets are currently as bullish on the Dollar as I’ve seen in a long time. A lot of this optimism is in my view built on sand, because the recent Fed meeting wasn’t nearly as hawkish as everyone seems to think. Oil prices have been tumbling, which is going to pull down inflation in coming months. That’s not an environment where the Fed can or should hike. There’s no sign underlying inflation is running out of control. All this means we’re currently at peak Dollar strength. The Dollar should fall from here.

Takeaways by Macro Roundup® AI

  1. Net positioning across the world's major currencies shows markets long the Dollar across the board, a degree of Dollar bullishness the author describes as among the strongest seen in a long time.
  2. The author argues Dollar optimism is built on sand because the recent Fed meeting was not as hawkish as markets believe, and tumbling oil prices will pull inflation down in coming months.
  3. Citing no sign that underlying inflation is running out of control and no environment in which the Fed can or should hike, the author concludes the Dollar is at peak strength and should fall from here.

Related Articles:

  • Currency Moves Can Drive Rebalancing — Trade responds to exchange-rate changes with a lag of roughly 8 to 12 quarters, and after the dollar fell from its mid-1980s peak the US trade deficit dropped from about 3% to about 1% of GDP while Japan's surplus fell from 4% to 2%. The author argues currency appreciation, not fiscal consolidation, drove that rebalancing.
  • The Dollar has Further to Fall — The author argues the dollar has considerably further to fall, noting Federal Reserve data show its real value nearly two standard deviations above its average since 1973, a level matched only twice before, each followed by depreciations of 25-30%. Financing the $1.1tn US current account deficit requires matching net capital inflows.
  • Global Debt Report 2026 — Gross central government borrowing across OECD countries rose 7% to a record $17tn, about 23% of GDP, and is projected to reach roughly $18tn, or 24% of GDP. The United States and Japan account for close to 80% of the area's refinancing requirements, with the US share rising from 57% to 70%.

AI Summary. The yen weakened past 161.95 per dollar to its lowest level since 1986, putting traders on alert for Japanese intervention to support the currency. The weak yen is lifting exporters' profits and Japanese stocks to record highs while raising import costs for oil and gas and fueling inflation that hurts consumers.

Mia Glass and Carter Johnson Bloomberg
Date Posted:

The yen hit its lowest level against the dollar since 1986, following the Plaza Accord. Bloomberg analyst Brendan Fagan argues, “Absent official action, there’s no reason for the yen to arrest its structural decline.”

How does a weakening yen affect Japanese stocks and consumers?

Core argument: The yen depreciated as much as 0.1% to 161.96 per dollar, its weakest level since 1986, breaching the 161.95 mark touched in July 2024 during an earlier Japanese campaign to support the exchange rate.

The yen slid to its weakest level against the dollar since 1986, a milestone that will generate unease in Japan and put traders on high alert for authorities wading into the market. The currency depreciated as much as 0.1% to 161.96 versus the greenback, breaching the 161.95 mark touched in July 2024 during an earlier campaign by Japan to shore up the exchange rate. The last time the yen traded at this level, it was barreling in the opposite direction, midway through a massive and years-long rally that followed a currency accord engineered by the US. This time, the yen is sliding, and Japan is on its way out of an economic funk that lasted for a generation. The currency weakness is boosting the profits of exporters and, in turn, helping the nation’s stock market to record highs. But import costs are swelling, notably for oil and gas shipments priced in dollars. The ensuing inflation is hurting consumers, who are paying more for everything from food to electricity, and threatening to undermine the popularity of Prime Minister Sanae Takaichi’s government.

Takeaways by Macro Roundup® AI

  1. The yen depreciated as much as 0.1% to 161.96 per dollar, its weakest level since 1986, breaching the 161.95 mark touched in July 2024 during an earlier Japanese campaign to support the exchange rate.
  2. Yen weakness is boosting Japanese exporters' profits and helping the nation's stock market reach record highs, while swelling import costs, notably for oil and gas shipments priced in dollars.
  3. Inflation is raising Japanese consumers' costs for everything from food to electricity and threatens to undermine the popularity of Prime Minister Sanae Takaichi's government.

Related Articles:

  • Can Japan Escape Its Debt Trap? — Japan's real effective exchange rate for the yen has fallen below Turkey's lira, signaling something profoundly wrong. Japan's gross government debt stands at 240% of GDP versus net debt of 130%, and selling some of the government's financial assets to pay down debt would reduce upward pressure on yields and downward pressure on the yen.
  • Global Debt Report 2026 — Gross central government borrowing across OECD countries rose 7% to a record $17tn, about 23% of GDP, and is projected to reach roughly $18tn, or 24% of GDP. The United States and Japan account for close to 80% of the area's refinancing requirements, with the US share rising from 57% to 70%.
  • Japan’s Debt Puzzle: Sovereign Wealth Fund from Borrowed Money — Japan's public sector operates as a highly leveraged sovereign wealth fund, funding risky assets by borrowing from banks and depositors at below-market rates, with returns sustaining its debt-to-GDP ratio above 200% without primary surpluses. The authors argue the resulting duration and currency mismatches expose Japan to mark-to-market losses that could trigger a fiscal crisis or a run on the yen.

Tuesday, June 30, 2026

AI Summary. Public debt in advanced economies has risen steadily, limiting governments' ability to cushion higher energy prices. Cyclically adjusted primary deficits averaged 1.9% of GDP in advanced economies since 2022 versus 1.1% over the two preceding decades, and 1.8% in emerging markets versus 0.1% from 2000–2019.

BIS Staff Bank of International Settlements
Date Posted:
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BIS warns, “Countries can no longer count on nominal growth to stabilise debt dynamics. They now must run primary surpluses or significantly smaller deficits to maintain stable debt-to-GDP ratios.”

Has rising public debt reduced governments' ability to cushion energy price shocks?

Core argument: Cyclically adjusted primary deficits in advanced economies averaged 1.9% of GDP from 2022 onwards, nearly double the 1.1% recorded over the two preceding decades.

Many countries entered the current energy crisis with limited fiscal space. Public debt in [Advanced Economies] (AE) has risen steadily over recent years (Graph 15.A), reducing governments’ ability to cushion fallout from higher energy prices. Although the increase partly reflects successive shocks, from the Covid-19 recession to the war in Ukraine, persistent failures to make meaningful progress on fiscal consolidation during economic expansions have also played a part. Cyclically adjusted primary deficits in AEs averaged 1.9% of GDP from 2022 onwards (Graph 15.B), nearly double the 1.1% recorded over the two preceding decades. [Emerging market economies] (EME) have seen an even sharper deterioration (1.8% since 2022 versus 0.1% between 2000 and 2019). Fiscal positions are set to remain strained over the coming years. Debt servicing costs are unlikely to ease soon, as higher interest rate payments continue to weigh on fiscal accounts (Graph 15.C). Deficits in 2027 are projected at or above 2025 levels in most jurisdictions.

Takeaways by Macro Roundup® AI

  1. Cyclically adjusted primary deficits in advanced economies averaged 1.9% of GDP from 2022 onwards, nearly double the 1.1% recorded over the two preceding decades.
  2. Emerging market economies saw a sharper fiscal deterioration, with cyclically adjusted primary deficits averaging 1.8% of GDP since 2022 versus 0.1% between 2000 and 2019.
  3. Deficits in 2027 are projected at or above 2025 levels in most jurisdictions, with debt servicing costs unlikely to ease as higher interest rate payments weigh on fiscal accounts.

Related Articles:

  • Global Debt Report 2026 — Gross central government borrowing across OECD countries rose 7% to a record $17tn, about 23% of GDP, and is projected to reach roughly $18tn, or 24% of GDP. The United States and Japan account for close to 80% of the area's refinancing requirements, with the US share rising from 57% to 70%.
  • Are Government Bonds Safe in Times of War and Pandemic? — Government bonds severely underperform in wartime, in absolute terms and relative to equities, housing, and economic growth, unlike in financial crises when bonds tend to outperform stocks. The U.S. and U.K. reduced war-driven debt-to-GDP ratios without explicit default, using surprise inflation and financial repression that shifted fiscal burdens onto bondholders.
  • Our Thoughts on Large US Deficits and Their Impact on Bond Yields — Total borrowing in the US is about average despite high government deficits, as high public borrowing has contributed to the need for higher interest rates that have depressed private sector borrowing. Risk premiums on long-dated debt look about average, with no market signs that economic or debt limits are currently being hit.

AI Summary. Gold fell below $4,000 a troy ounce, down nearly 14% over three months, its worst quarterly performance in more than a decade after reaching a record high near $5,595. Analysts attribute the decline to expectations of US interest rate rises, outflows from gold-backed funds, traders shifting into AI stocks, and Chinese bank restrictions on retail bullion trading.

Leslie Hook Financial Times
Date Posted:

Gold fell below $4,000 a troy ounce for the first time since November; the decline may be driven in part by the more-hawkish-than-expected stance Kevin Warsh, along with many FOMC participants, has taken since Warsh’s arrival at the Fed.

Why has gold fallen to its worst quarter in over a decade?

Core argument: Gold fell below $4,000 a troy ounce, dipping to $3,943 — its lowest since November — leaving it down nearly 14% over three months, its worst quarterly performance in more than a decade.

The price of gold fell below $4,000 a troy ounce on Tuesday as it headed for its worst quarterly performance in more than a decade. The price of bullion dipped just below $3,943, its lowest level since November, in early trading before recovering slightly, leaving it down nearly 14% over the past three months. Having rocketed to a record high of nearly $5,595 in January, driven by frenzied speculation among retail traders, gold has been hit hard as the hawkish stance of new US Federal Reserve chair Kevin Warsh boosts expectations of interest rate rises this year. Some traders have also sold gold to fund bets on soaring AI stocks and chipmakers or SpaceX’s record IPO, analysts say. In recent weeks, outflows from gold-backed exchange-traded funds, combined with new restrictions by some Chinese banks on bullion trading by retail investors, have further weighed on the price.

Takeaways by Macro Roundup® AI

  1. Gold fell below $4,000 a troy ounce, dipping to $3,943 — its lowest since November — leaving it down nearly 14% over three months, its worst quarterly performance in more than a decade.
  2. Gold reached a record high of nearly $5,595 in January, driven by frenzied speculation among retail traders, before the hawkish stance of new US Federal Reserve chair Kevin Warsh boosted expectations of interest rate rises this year.
  3. Analysts say some traders sold gold to fund bets on soaring AI stocks and chipmakers or SpaceX's record IPO, while outflows from gold-backed exchange-traded funds and new Chinese bank restrictions on retail bullion trading weighed on the price.

Related Articles:

  • The Debasement Trade Is Unraveling and Kevin Warsh Is One Big Reason — The "debasement trade" — favoring gold and Bitcoin over a dollar seen as vulnerable to inflationary, fiscal and monetary excess — has been a defining market narrative, but a new Federal Reserve chairman's emphasis on price stability as the overriding priority lifted the dollar and long-dated Treasuries at the expense of gold and crypto.
  • Are Government Bonds Safe in Times of War and Pandemic? — Government bonds severely underperform in wartime, in absolute terms and relative to equities, housing, and economic growth, unlike in financial crises when bonds tend to outperform stocks. The U.S. and U.K. reduced war-driven debt-to-GDP ratios without explicit default, using surprise inflation and financial repression that shifted fiscal burdens onto bondholders.
  • Global Debt Report 2026 — Gross central government borrowing across OECD countries rose 7% to a record $17tn, about 23% of GDP, and is projected to reach roughly $18tn, or 24% of GDP. The United States and Japan account for close to 80% of the area's refinancing requirements, with the US share rising from 57% to 70%.

AI Summary. AI company valuations rest on the assumption that profit margins across non-tech firms will eventually rise, but outside a handful of sectors adoption is slow, creating a divergence between front-loaded valuations and slower cash flows. If the per-use costs of AI models converge toward zero, revenue may be insufficient for all major cloud providers.

Torsten Sløk Apollo
Date Posted:
Is Database:
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Sløk notes there are no signs of rising profit margins outside of the tech sector; AI’s ROI runway outside the tech sector may be long, creating a divergence between “front-loaded valuations today and a much slower cash flow reality.”

How long is the payoff runway for AI outside tech?

Core argument: AI company valuations rest on the promise that margins across the S&P 493 will eventually climb, embedding assumptions about future earnings into present market prices.

The value of AI companies today rests entirely on the promise that margins in the S&P 493 will eventually climb. That promise is the link to current market prices, since implicit in the valuations of AI companies are assumptions about future earnings. That's why the current debate about token costs, model routing, and token marketplaces is important. If token costs converge toward zero for most AI use cases, then there is not enough revenue for all hyperscalers, even in a situation where compute demand surges higher. The key issue is the length of the ROI runway outside the tech sector. In a handful of sectors, implementation is nearly immediate. But that is the exception. This creates a dangerous divergence between aggressive, front-loaded valuations today and a much slower cash flow reality, since equity markets priced for instant earnings growth will face a painful repricing if the productivity hockey stick takes five years rather than five months. If token costs converge toward zero for most AI use cases, then there is not enough revenue for all hyperscalers even in a situation where compute demand surges higher.

Takeaways by Macro Roundup® AI

  1. AI company valuations rest on the promise that margins across the S&P 493 will eventually climb, embedding assumptions about future earnings into present market prices.
  2. Equity markets priced for instant earnings growth face a painful repricing if the productivity hockey stick takes five years rather than five months, with near-immediate implementation confined to a handful of sectors.

Related Articles:

  • The State of the AI Economy — An analysis estimates the AI ecosystem generated $110bn in revenue over 12 months excluding double-counting, with the most recent month annualizing to a $175bn run rate. After separating AI-specific capital spending from the roughly $120bn hyperscalers already spent annually and depreciating compute over 6 years, revenues attributable to hyperscalers roughly cover depreciation.
  • Why .400 Hitters Disappeared — and What It Means for AI — Artificial intelligence models' capability gains are shrinking in percentage terms, falling from about 15% relative to the baseline early on to roughly 10% for the same absolute increment, narrowing the gap between frontier and good-enough models. The author argues this points to a commoditizing market where price, not minor model differences, becomes the main differentiator, pressuring frontier firms' margins.
  • Semiquincententacles — Leading artificial-intelligence labs are moving to usage-based token pricing on a cost-plus basis that includes total ownership costs, pushing token prices higher and giving some enterprises reason to migrate to cheaper open models. Frontier models remain necessary for cybersecurity, distillation training, agents, and scientific discovery, where maximum performance is required.

AI Summary. Historical records indicate immigrants arriving in the United States around the turn of the twentieth century came with almost no wealth, and by 1920 nearly half of white adults were foreign-born or had foreign-born parents. Households of Southern or Eastern European ancestry, who arrived later with fewer resources, are on average wealthier than those of Northwestern European ancestry.

Brian Marein Wake Forest University
Date Posted:
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Database
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Except possibly at the very top of the distribution which SIPP cannot measure, the wealth of “new” Southern and Eastern European immigrants to the US has fully caught up with “old” immigrants. Wealth converges quickly once earnings inequality vanishes.

Do initial wealth disadvantages among immigrant groups persist across generations?

Core argument: Households of Southern or Eastern European ancestry, whose families arrived later and with substantially fewer resources, are on average wealthier than those of Northwestern European ancestry, contrary to what persistent initial wealth disadvantages would predict.

Inferring the determinants of long-run inequality from group-level data is complicated by the arrival of 30 million Europeans during the Age of Mass Migration (roughly 1850 to 1924), who are by construction included in average white wealth despite having no direct claim to the wealth accumulated by earlier Americans. By1920, nearly half of white adults were either foreign-born or had foreign-born parents. Using the United States Immigration Commission Reports (commonly known as the Dillingham Commission Reports), I document that immigrants at the turn of the twentieth century arrived with almost no wealth. [Thus] a large share of the white population started from a substantial wealth disadvantage. Northwestern Europeans comprised the overwhelming majority of earlier immigrants, dating back to the initial European settlement of North America, while Southern and Eastern Europeans predominated at the turn of the twentieth century. If initial wealth disadvantages persisted across generations, one would expect households of Southern or Eastern European ancestry to possess less wealth than those of Northwestern European ancestry, since their families arrived later and started with substantially fewer resources. In fact, they do not. On average, they are wealthier.

Takeaways by Macro Roundup® AI

  1. Households of Southern or Eastern European ancestry, whose families arrived later and with substantially fewer resources, are on average wealthier than those of Northwestern European ancestry, contrary to what persistent initial wealth disadvantages would predict.
  2. Roughly 30 million Europeans arrived during the Age of Mass Migration, spanning about 1850 to 1924, and by 1920 nearly half of white adults were foreign-born or had foreign-born parents, yet all are included in average white wealth.
  3. The United States Immigration Commission Reports, known as the Dillingham Commission Reports, indicate that immigrants at the turn of the twentieth century arrived with almost no wealth, so a large share of the white population started from a substantial wealth disadvantage.

Related Articles:

  • The Myth of Nordic Mobility: Social Mobility Rla — Correcting for measurement error by using relative rather than absolute correlations among relatives, the authors estimate that educational intergenerational mobility in Denmark and Sweden is much lower than conventionally measured, with parent-child and sibling correlations much higher. They argue Nordic education spending and income compression have at best modestly reduced families' role in children's educational outcomes.
  • 00 to 2022 — Using a genealogical database of 422,374 English people with rarer surnames, the authors find social status persists strongly even among distant relatives, with status correlations declining by a constant factor of 0.79 per step in the lineage across all status measures and eras studied. The authors argue this constancy suggests social interventions have modest effects.
  • Changing Opportunity: Sociological Mechanisms Underlying Growing Class Gaps and Shrinking Race Gaps in Economic Mobility — Across the 1978 to 1992 birth cohorts, adult household incomes fell for white children raised in low-income families and rose for those raised in high-income families, increasing the intergenerational persistence of income ranks among white children by 28%. Over the same cohorts, adult incomes rose for Black children at all parental income levels.

AI Summary. Screwworm infections have been confirmed in more than two dozen animals, including cattle, sheep, goats and a dog, threatening Texas, which produces roughly 14% of US beef supply. The outbreak comes with the US cattle herd at its lowest level in generations and beef prices at or near record highs.

Erin Ailworth and Michael Hirtzer Bloomberg
Date Posted:

The US has now confirmed more than two dozen screwworm infections. At ~86mm the US cattle herd is at its lowest level since 1951, and beef prices are near record highs.

Does a screwworm outbreak threaten US beef supply and prices?

Core argument: Screwworm infections have been confirmed in more than two dozen animals since early June, including cattle, sheep, goats and a dog, threatening Texas, the top US beef-producing state.

[Screwworm] infections have been confirmed in more than two-dozen animals, including cattle, sheep, goats and even a dog, since early June. That’s threatening the country’s top beef-producing state, Texas, at a time when the US cattle herd is already at its lowest level in generations. The infestation couldn’t come at a worse time. Beef prices are at or near record highs. And with Texas producing roughly 14% of the country’s beef supply, the ramifications could extend far beyond its borders. During a major screwworm outbreak in 1976, the fly infected 1.8 million head of cattle and sheep in Texas.

Takeaways by Macro Roundup® AI

  1. Screwworm infections have been confirmed in more than two dozen animals since early June, including cattle, sheep, goats and a dog, threatening Texas, the top US beef-producing state.
  2. Texas produces roughly 14% of US beef supply, and the infestation arrives with the US cattle herd at its lowest level in generations and beef prices at or near record highs.
  3. During a major screwworm outbreak in 1976, the fly infected 1.8 million head of cattle and sheep in Texas.

Related Articles:

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AI Summary. JPMorgan has created a $10bn fund that invests the bank's own capital directly into companies including an Idaho gold mine and a San Diego maker of artificial-intelligence-powered fighter drones, reviving Wall Street's older "merchant banking" tradition. The bank has said it wants to eventually allocate $20bn or more to the fund.

Alexander Saeedy Wall Street Journal
Date Posted:

Under a new initiative, Jamie Dimon is directly investing $10B of JPM’s own capital into US defense and national security firms. The bank has also targeted $1.5T in lending and financing for defense, energy, and critical supply chains by 2035

Are banks investing their own capital directly into defense and mining companies?

Core argument: JPMorgan hired Todd Combs, formerly a star investment manager at Berkshire Hathaway, to run a $10 billion direct-investment fund, and Jamie Dimon has said he wants to eventually allocate $20 billion or more to it.

The new program harks back to a former tradition on Wall Street of “merchant banking,” when Gilded Age banks and their successors in the 1980s invested their capital directly into the stock of companies such as Consolidated Edison, U.S. Steel, and RJR Nabisco, making bankers powerful sculptors of America’s industrial might. The bank hired Berkshire Hathaway’s star investment manager, Todd Combs, to run the $10 billion fund. So far, the fund has invested in a gold mine in Idaho and a San Diego-based manufacturer of fighter drones powered by artificial intelligence. Dimon has said he wants to eventually allocate $20 billion or more to the fund.

Takeaways by Macro Roundup® AI

  1. JPMorgan hired Todd Combs, formerly a star investment manager at Berkshire Hathaway, to run a $10 billion direct-investment fund, and Jamie Dimon has said he wants to eventually allocate $20 billion or more to it.
  2. The JPMorgan fund's investments so far include a gold mine in Idaho and a San Diego-based manufacturer of fighter drones powered by artificial intelligence.
  3. JPMorgan's program harks back to Wall Street's merchant banking tradition, when Gilded Age banks and their 1980s successors invested their own capital directly in the stock of companies such as Consolidated Edison, U.S. Steel, and RJR Nabisco.

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