- The MoneyFitt Morning
- ☀️☕️ A.I. Firing (on all Cylinders)
☀️☕️ A.I. Firing (on all Cylinders)
📊 Also: China no bazooka; TOPIX record; India records; Germany shrinks; MLK Day 🎓 Davos
A.I. Firing (on all Cylinders)
📊 In the Markets
China no bazooka; TOPIX record; India records; Germany shrinks; MLK Day
📖 MoneyFitt Explains
💸 Personal Finance Corner
A.I. Firing (on all Cylinders)
A survey released at the opening of this year’s WEF at Davos🎓 reveals that 25% of global CEOs anticipate a reduction in headcount by at least 5% due to the deployment of generative artificial intelligence in 2024.
Industries such as media, banking, insurance and logistics are most likely to see job losses due to cutting-edge AI tools, according to the PwC study based on interviews with 4,702 company leaders across 105 countries. Cyber security (MFM: “‘This is War’ - Cybersecurity”) and the spread of disinformation remain top risks associated with AI.
At the same time, 46% expect generative AI to boost profitability in the next 12 months (not only through cost cutting: 58% expect it to improve the quality of their products or services.) But a slightly larger number, 47%, believe it will deliver little or no change, which should be disturbing to their shareholders.
..... ▷ The optimistic scenario for anti-Luddites would be for AI to automate routine tasks, freeing humans for more complex and creative work, as has been the case in past technological disruptions from the “spinning jenny” onwards.
This English invention from 1765 at the start of the Industrial Revolution was one of the key developments in the industrialisation of textile manufacturing.
It slashed the amount of work needed to produce cloth, with a single worker able to work eight or more spools at once, later growing to 120 as the technology advanced.
This gave rise to the Luddites, the textile workers named after the fictional Ned Ludd, who protested against such innovations, fearing, correctly, that automation would cost them their jobs. They engaged in machine-breaking and destruction of factories between 1811 and 1817, advocating for better working conditions and opposing technological advancements in their industry. (Bosses take note.)
The OpenAI of its day - Spinning jenny at Blackburn Museum and Art Gallery- Image credit: Geni,, CC BY-SA 4.0,
..... ▷ Job Functions most at risk (to start with):
Data entry and processing: Repetitive tasks like copying, sorting, and summarising data can be easily handled by AI algorithms.
Basic customer service: AI chatbots can take care of simple inquiries and FAQs, leaving human agents for complex issues or those requiring empathy.
Manufacturing and assembly: Robots powered by generative AI can learn and adapt to various tasks, potentially replacing an increasing amount of human labour on production lines.
Financial analysis and trading: AI can analyse inhumanly vast amounts of market price, news and industry data and execute trades with evolving strategies autonomously, impacting roles like financial analysts and most traders.
Content creation: Simple writing tasks like news reports, product descriptions, and marketing copy can be generated by AI, impacting many journalism and marketing positions (but not newsletters.)
..... ▷ Industries most at risk (to start with):
Transportation: Self-driving cars and delivery drones powered by generative AI could significantly alter the trucking and taxi industries.
Customer service: As mentioned, AI chatbots and virtual assistants are likely to take over much of the customer service workload, impacting remaining call centres and help desks.
Retail: Automation in warehouses and stores, combined with personalised recommendations through AI, could continue to disrupt the retail industry, potentially reducing the need for cashiers and shop assistants in remaining brick-and-mortar outlets.
Telemarketing and sales: AI-powered cold calling and lead generation tools could automate basic sales tasks, affecting certain roles in these industries.
Administrative and clerical work: Tasks like scheduling, calendar management, and document processing are prime candidates for automation, impacting administrative assistants and similar roles.
..... ▷ Professions: Accountants, Lawyers, and Doctors (to start with):
Accountants: As AI automates routine tasks like data entry, accountants with roles that involve repetitive processes are at risk, so they need to upskill to stay relevant. Understanding AI, data analytics, and cloud-based accounting systems is crucial. With automation, they will need to navigate increasingly complex ethical issues related to data privacy, bias and transparency. As PwC notes, billable hours will transition to outcome-based payment.
Lawyers: AI can handle legal research and document review more efficiently. This reduces billable hours (but also junior staff costs) for lawyers. AI-powered tools can analyse vast legal databases, statutes and case law, assisting senior lawyers in research, saving time and improving accuracy. Document review and drafting of standardised contracts, due diligence and discovery is increasingly automated using AI, identifying potential risks, inconsistencies and missing clauses. As with accountants, fewer bottom-up training opportunities for junior lawyers can lead to fewer experienced senior lawyers in future.
Doctors: As AI systems handle routine tasks, there's a risk of redundancy for certain medical roles, such as radiologists, pathologists and other specialists who rely heavily on image interpretation, though AI is not infallible and false positives or negatives can still occur. AI algorithmic "black boxes" can lead to biases if training data is biased, perpetuating inequalities in healthcare. AI can't, for now, replace the empathy and human touch that doctors provide, so patients may feel uncomfortable if AI dominates their healthcare interactions. Malpractice lawsuits involving AI could become more common (see lawyers above.)
🇸🇬 Singapore: Let’s Get MoneyFitt!
📊 In the Markets
Asia markets (except for Japan’s, of course, and India) were mixed in Monday trading.
China surprise: The People’s Bank of China unexpectedly left the rate on its one-year medium-term lending facility loans (i.e. loans to financial institutions) unchanged at 2.50%. The MLF is one of the most important Chinese interest rates, and traders (still desperately looking for bazooka monetary and fiscal stimulus for the flagging, deflationary economy) were hoping for a cut, which would have been the first since August.
Japan's TOPIX extended its record-breaking run, reaching multi-decade highs with a 1.22% gain. The export-heavy Nikkei was up 0.91%. Export rival South Korea's Kospi ended just slightly above flat, managing to break an eight-day losing streak.
Taiwan post-election: Taiwan's Weighted index rose but closed off its highs for a gain of 0.19% after the Democratic Progressive Party’s Lai Ching-te won the presidential election for the third time but without winning a majority.
India record highs: India's stock markets opened the week with a strong rally, propelling the benchmark 30 blue chip stock S&P BSE Sensex past 73,000 for the first time with a 1.05% gain on Monday, led by IT companies like Infosys, Tech Mahindra, HCL Tech and Wipro.
This took the Sensex gain over the last 12 months to 22%, driven by strong growth prospects, increased domestic participation and general optimism surrounding general elections.
The broader NSE Nifty 50 index (an equally important benchmark) broke 22,000 for the first time and closed up 0.93%, making it a 23.5% gain over the last year.
After a bright start, stocks in Europe dropped as bond yields rose following hawkish remarks from European Central Bank policymakers at Davos on Monday. Yields on 10-year German Bunds, the eurozone benchmark, increased by 0.05 percentage points to 2.2%.
Germany down: The engine of Europe and its biggest economy, Germany's GDP contracted by 0.3% in 2023, marking its first decline since the start of the COVID-19 pandemic, posing risks to the broader euro area. The weak showing was mainly down to high prices, rising interest rates and weak domestic and foreign demand. Fourth-quarter GDP also fell by 0.3%, but as the third quarter was flat, it narrowly avoided the label of a recession. The outlook for 2024 remains bleak, with forecasters seeing government spending cuts and continuing soft demand, probably leading to zero GDP growth.
US markets were shut on Monday for Martin Luther King Jr. Day.
📖 MoneyFitt Explains
The World Economic Forum (WEF), held annually since 1971 in the picturesque Alpine Swiss town of Davos, is a global gathering of leaders, business executives, policymakers, intellectuals and random influencers.
Though now a bit of a self-important media circus, the WEF initially focused on European business management and "stakeholder capitalism", the idea that companies should serve not only shareholders but also employees, suppliers and communities.
It has since evolved into a platform for international collaboration, serving as an influential space for public-private cooperation, generating solutions, and shaping policy agendas.
Over the years, Davos has addressed key challenges, including economic inequality, climate change, and technological disruptions (e.g. Web3, gene editing, PCs, AI.)
For example, the historic 1992 handshake between South African President F.W. de Klerk and African National Congress leader Nelson Mandela in Davos is considered a symbolic moment marking the end of apartheid in South Africa.
However, Davos has faced criticism for its exclusivity, with detractors arguing that it perpetuates an elite-driven approach to problem-solving, notably excluding grassroots voices.
Critics also highlight concerns about the influence of corporate interests and question the tangible impact of the forum’s discussions on real-world issues. The irony of multiple tycoons arriving in private jets with climate change discussions on the ground rarely goes unremarked.
Despite these criticisms, the WEF’s annual meeting remains a notable event shaping global discourse and policy considerations.
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