Things we are reading today - June 22nd & 23rd, 2023

Philanthropy, particularly liberal philanthropy, has a “dark side.” This article discusses the argument made by author Garrett Neiman in his book “Rich White Men” that the current model of philanthropy is badly broken. Neiman argues that liberal philanthropy has become a “tax avoidance scheme” for the wealthy, allowing them to avoid paying their fair share of taxes while still being able to influence public policy. While philanthropic donations can be beneficial, they can also perpetuate systemic problems by allowing the wealthy to maintain power and control over society

Artificial intelligence (AI) is playing an increasingly important role in trading, with the potential to help traders create technical indicators, trading methods, and even trading algorithms based on certain indicators and attitudes. Traders are using AI to find profitable opportunities, make quicker and better trading decisions, analyze vast volumes of data, and find patterns that human traders might not immediately see. This enables traders to choose the best time to buy or sell stocks with greater knowledge. While AI can be useful in trading, it should be kept in mind that it is not a perfect answer and should be used in conjunction with human skill and discretion

Some startup shares are selling for up to 61% off, attracting interest from venture capital and hedge funds. This trend is due to the increasing popularity of the secondary market, which allows investors to buy and sell shares of private companies before they go public. There used to be a stigma around buying shares on the secondary market, but that stigma has largely disappeared as more investors recognize the potential benefits of getting on board a promising company. While this trend may be appealing to investors looking for a good deal, it is important to note that investing in startups can be risky and should be done with caution

Venture capital firm Andreessen Horowitz has launched a new “perennial” fund that will allow it to invest in companies over a longer period of time. The fund is designed to provide more flexibility and is titled a16z Perennial Venture Capital Fund to continue backing successful companies beyond the typical 10-year investment cycle. This move is part of a trend in the venture capital industry towards longer-term investing strategies that allow for more patient and sustainable growth

Robinhood has acquired credit card startup X1 for $95 million. This move is part of Robinhood’s ongoing efforts to expand its financial services offerings beyond its core trading platform. X1’s technology will allow Robinhood to develop its own credit card product, which will likely be integrated with its existing trading and investing services.This acquisition is particularly significant given Robinhood’s recent IPO and its ongoing efforts to diversify its revenue streams. By expanding into credit cards, Robinhood can potentially generate additional revenue from interest and fees. However, it is important to note that entering the credit card market also comes with risks, including potential regulatory scrutiny and the potential for credit card defaults

Christopher Nolan, the acclaimed filmmaker, is set to release a biopic of J. Robert Oppenheimer, the father of the atomic bomb. In a recent cover interview with Wired, Nolan discussed the importance of Oppenheimer’s story and how it relates to the dangers of artificial intelligence (AI) and the potential for an AI apocalypse

The author talks about his experiences as a stockbroker in the late 1990s, pushed by the truck-load of money the industry was making. The process of transferring shares was tedious and time-consuming, with significant risks and delays involved. Things have been much better now, with the NSE dominating. Regulations have minimised the role of brokers as advisors, leaving investors to make decisions independently. Overall, the article highlights the changes and challenges in the broking industry, with potential opportunities in portfolio management and alternative investment funds

The article discusses Google Cloud’s launch of a new AI-driven anti-money laundering (AML) product. Unlike traditional AML tools that rely on rules-based programming, Google Cloud’s technology uses machine learning to screen for and report potentially suspicious activity. The company aims to differentiate itself by reducing the need for human input in the process. The product, called Anti Money Laundering AI, has already been adopted by notable financial institutions such as HSBC, Banco Bradesco, and Lunar. By leveraging an AI-first approach, Google Cloud’s tool aims to improve the efficiency and accuracy of detecting money laundering risks, reducing false positives, and providing better explainability of flagged activities. However, some industry skeptics raise concerns about the limitations of machine learning tools compared to human judgment

The article discusses the impact of stock-based compensation (SBC) on companies’ earnings and valuations. It highlights the widening gap between adjusted earnings and GAAP earnings, with SBC being a significant factor. SBC, particularly prevalent in the tech sector, can lead to dilution of shares and reduced share value in a downturn. The article suggests that investors should account for the dilution effects of SBC and incorporate its cost in valuations, considering it as a cash proxy that reduces free cash flow. Companies often use share buybacks to offset SBC dilution, and comparing buybacks to the net SBC cost can determine their effectiveness in returning capital to investors.

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Apple is ready to join and disrupt the financial services space in India :face_with_raised_eyebrow:

That’s possibility as Apple will gain a lot from the existing customer base and client loyalty at the same time Apple’s credit card (US Version) is actually quite decent for a beginner who’s getting into using credit card.

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