I should be honest about my bias here. On a spectrum between those who see AI as a technology that overpromises and will eventually underdeliver, and those—like Marc Andreessen and DHH—who see it as a transformative technology with enormous promise, I am firmly in the latter camp. All that really means, however, is that I am choosing to lean into the technology for two reasons. First, because I genuinely think it is cool. Second, because whether I like it or not, it will transform the industry in which I work. I can’t afford not to understand and use it.
Read MoreI have augmented my US equity sector chartbook with two more similar chartbooks; a simple one with the four major factors—value, momentum and minimum volatility—and one with global country equity indices ex-the US. The factor chartbook uses the iShares global factor ETFs—IWVL, IWMO, MVOL—and VEU for a non-US factor. The global chartbook also uses iShares country ETFs. I have also corrected some errors in the cross-calculation statistics and the corresponding Z-scores.
The latest versions of the chartbooks can be found here (US sectors), here (global beta ex-US) and here (Factors), with there accompanying portfolio statistics here here and here.
Read MoreIt’s been two years since I last created an AI advent calendar, a stretch of time that feels like a lifetime given the pace of progress in large language models and AI more broadly. Back then, I used the then-current version of ChatGPT and the first iteration of DALL·E—the image generation tool where you had to purchase tokens on the go.
This time, I’m using GPT-5.0. Rather than producing short stories based on images, I’ve asked the AI to generate 24 short essays on economic theories and concepts, each roughly 600 words. A typical prompt might be something like: “Write an essay about [topic] in 600 words.”
I quickly discovered the need to be specific. GPT loves bullet points and excessive bolding, so I had to explicitly instruct it to avoid both. I also standardized a referencing format to ensure consistency across essays. In some prompts, I provided detailed context to steer the AI in a particular direction; in others, I left it more open-ended.
Read MoreI have been inspired, by listening to recent conversations on the Glenn Show, to delve into the writings of Thomas Sowell. This is a daunting task since the man has written a huge number of books, articles and essays. The Thomas Sowell Reader, however, seems to be a representative collection and a decent place to start. I am enjoying the reading experience so far. TS writes from a conservative, and fiercely pro-free market, perspective, at least in this the volume mentioned above. This invariably will put some readers off. But you’d be hard pressed to find a better example of punchy, yet eloquent, non-technical exposition of economics, social and political issues. The essay on the economics of discrimination and the small tract on “unfunded mandates” are particularly feisty and enjoyable.
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