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CrowdCent Curation - No. 46
Macro & Markets in the Months Ahead, Bitcoin ETFs, & LLMs in the Physical World
Hope everyone had a great summer! After a goldilocks period in the first half of 2023, we expect volatility is set to meaningfully increase in the coming months — in both the market and in the world. In order to help navigate this tumultuous time, we will increase the frequency of both our newsletter and related live Spaces (next one on Tuesday, 9/12) — excited to connect soon!
Tuesday (9/12) we’re hosting a Twitter Spaces at 11:00am ET - join us CrowdCent Curation - Live!
The discussion will focus on our current Macro & Markets views, along with an update on the rapidly changing NLP/LLM landscape
CrowdCent Alpha - ChatGPT meets Warren Buffet. An investment ‘oracle’ in many ways, and eventually an essential tool in every investor’s toolkit. Available now - email us for early access
Continued strong performance for SZ Strategies – and now new & improved models are being implemented
Reminder - we use our quantitative models (powered by cutting-edge AI & NLP technology) to select ideas from SumZero's vast database of investment research that have the potential to generate superior returns – with over 3 years of out-of-sample results, so far, so good!
For a snapshot of return info, ideas selected, and our 2023 macro commentary – read the latest Summary Report
As a reminder, this CC thread + SZ thread provide great summaries of the process and the product – accessible to everyone, today!
In the coming weeks we’ll provide a refresh of our next decade thoughts (original post; see below ‘Thoughts and Predictions’) and check out how our predictions are doing
Join our Telegram chat & follow us on Twitter for our latest thoughts & updates
“Shall I not follow in the footsteps of my predecessors? I shall indeed use the old road, but if I find one that makes a shorter cut and is smoother to travel, I shall open the new road. Men who have made these discoveries before us are not our masters, but our guides. Truth lies open for all; it has not yet been monopolized. And there is plenty of it left even for posterity to discover.” - Lucius Annaeus Seneca
Translation: Stand on the shoulders of giants — use the discoveries from those before you as the foundation to help accelerate innovations today. But do not accept anyone’s views or teachings blindly — think for yourself, and use other’s as a guide, not doctrine. Most people seek truth, and do not like being lied to. In this age of distrust (common in 4th Turnings), with the media constantly spinning falsehoods to generate clicks, it’s difficult to find a source of truth. It takes a lot of time and energy to filter out the noise. Hopefully these curations provide a small step forward…
Finance
Wave of U.S. Treasury Issuance Puts Pressure On Bond Market [Podcast]
Recap (GPT4): In this podcast, Aahan (founder of Prometheus Research) discusses his current macro outlook on the economy, growth, markets, and liquidity. He talks about the upcoming wave of U.S. Treasury issuance and why he sees it as a perfect opportunity to short stocks and bonds. He also anticipates further headwinds for assets in this environment. The podcast covers topics such as progressing through a tightening cycle, how to measure liquidity, whether the Fed is behind the curve, inflation, and the contraction of credit.
Comment: Great podcast on the mechanics of the market and the path ahead. Our goldilocks scenario played out in the 1H of 2023, but now we enter the teeth of inflation accelerating, liquidity contraction coming, and credit risk rising in the coming 6-12 months. His views largely foot with our expectations — inflation (CPI) is set to reaccelerate y/y into 4Q23/2024, the yield curve will steepen, and we’re likely to see new highs in rates. As liquidity begins to diminish on the margin in November and on, we expect the blunt of these realities will begin to bite. We’ll delve into this in more detail on our Spaces, as well as in future Curations (as we assess and refresh our predictions) — but the summary is, the next 12 months is likely to be bumpy for risk assets.
Blockchain
SEC Delays Spot Bitcoin ETF Decision [Article]
Recap (GPT4): The SEC has postponed its decision on all spot bitcoin exchange-traded fund (ETF) applications until October, including high-profile applicants like BlackRock. The SEC has a total of 240 days from the start of its review of the applications to make a final decision. In addition, the D.C. Circuit Court of Appeals ruled that some of the SEC's arguments in rejecting bitcoin ETF applications seemed "arbitrary and capricious," after Grayscale argued that the SEC didn't have a firm basis to reject its bid to convert the Grayscale Bitcoin Trust into an ETF.
Comment: In our view, this is not particularly surprising. In the background, BlackRock is buying up stakes in Bitcoin miners and likely beginning to build a stake in Bitcoin - so they already have a position prior to launching an ETF. This all appears to be coordinated from “the top.” A washout of Tether and Binance would be logical next steps to ‘purge’ the system. And when the ‘big boys’ are ready (i.e. positions built), the ETFs will get approved (likely 1H24).
Technology
The Rise of LLM Technologies in Robotics [Article]
Recap (GPT4): The article discusses the rise of Large Language Models (LLMs) like ChatGPT in robotics. LLMs are being integrated into search engines, software applications, and personalized devices for improved customer support. A significant advancement is the use of LLMs in robots, enabling them to communicate using natural language. This development opens up possibilities for home assistant robots and automated customer service robots. The integration involves both hardware (sensors and actuators) and software (natural language processing algorithms). However, challenges exist, including accurate language interpretation, data privacy and security, hardware limitations, and ethical considerations. Despite these, the potential benefits are immense, promising exciting future developments.
Comment: The first wave of disruption and lowest hanging fruit for these powerful LLM models is certainly on improving efficiency in the software/non-physical world – from changing how we interact with the Internet, to how we code (and so on). But as we increasingly outfit robots (including vehicles, equipment, etc.) with sensors that can interact with the physical world, and combine that with the powerful software (including these LLMs, allowing them to communicate using natural language) we’ve been discussing, the results may surprise. The outcome will likely be an acceleration of innovation in the physical world — from food delivery robots, to self-driving cars.
CrowdCent Products
CrowdCent is building out several new products, many of which you can test out today (email us: info@crowdcent.com):
CrowdCent Alpha - ChatGPT meets Warren Buffet. An investment ‘oracle’ in many ways, and eventually an essential tool in every investor’s toolkit. Available now for early access…
SZ Strategies - this CC thread + SZ thread provide great summaries of the process and the product. Check out the video of Jason explaining how CrowdCent is training ML algos with SZ ideas to build investment portfolios here. For a more detailed read, check out the whitepaper here.
CrowdCent ‘dapp’ on Numerai - check out the post here, and commentary in an earlier Curation
CrowdCent Analyzer - Want to get feedback on an investment idea? See what a trained machine learning model thinks of your idea (the probability of under/outperformance)? Email us (info@crowdcent.com) and/or check out the free private beta here.
CrowdCent Thoughts & Predictions
Check out below for some updated thoughts on the next decade. These thoughts update/build upon our previous predictions, which you can find below:
For our latest macro & market thoughts, check out our quarterly update:
CrowdCent Site Updates
Check out the new landing page, about, mission, and vision
Any suggestions for CC Curation improvement, website, etc. - send an email to info@crowdcent.com
Look forward to more updates soon - the future is here...
Best,
Jason, Ryan, & Carlo
Website: CrowdCent
Twitter: @CrowdCent
Telegram: Link