- Diagnosing COVID-19: An app for that?
- George Gilder on creative “disorder”
- The Fed puts big banks on the stress-test treadmill…
- … and protects patient privacy
- Americans spend more, save less
- SALT revenue up for grabs
- A reader gets mixed “tongue-in-cheek” signals… Another reader doesn’t support the EARN IT Act, but… Can stimulus checks raise the dead?… And more!
We are developing an app that can analyze an individual’s speech to detect COVID-19 symptoms,” says lead engineer Mohammed Usman at IEEE Spectrum.
Here’s the premise: “While COVID-19 symptoms may not be conspicuous to the affected individual or others, they will cause subtle variations to speech characteristics that can be detected by artificial intelligence (AI) algorithms.
“That’s because infected individuals undergo changes to body parameters such as temperature, heart rate, blood pressure and breathing rate. All of these affect the physiology of speech and are reflected in speech signals.”
The endgame? While the app is meant to complement existing diagnostic tools, the hope is an affected person “can be quarantined, tested and provided with medical support at a much earlier stage.”
It’s this sort of creative thinking — combined with transformational technology — that futurist George Gilder applauds. But make no mistake, he says, there’s no clear path from A–Z when it comes to technology breakthroughs.
That’s what he tells The 5’s founder and executive publisher, Addison Wiggin…
“Entrepreneurship, technological creativity, is surprising,” George says. “It’s disorder.”
To that end, he continues: “I don’t follow trends… Trends are what’s predictable. [It’s] the rearview mirror way of surveying the world. I try to take all sorts of technologies and think how they interconnect in unexpected ways to produce new surprising opportunities.”
He cites, for example: “This new drone system that’s been developed, it’s well on its way… to taking over the delivery of most cargo.
“Self-driving airplanes are much easier to build,” he notes, and because they’re made for cargo, “they can be much simpler. They can be guided from outside the airplane” and equipped with “lidar and other technologies that prevent them from colliding with anything.”
George says: “They’re the next great containerization move.”
And here’s where new technology intersects with commerce: “Containerization made possible world trade,” says George. “And this technology is going to enable a huge new success of globalization, and the United States should not be on the wrong side of it.”
[Ed. note: Another creative disruptor George Gilder sees on the horizon is 5G technology… That’ll do more than just boost internet speed for smartphones.
It’s going to unleash all kinds of long-promised technologies: From self-driving airplanes… to the internet of things… to augmented reality… to virtual reality… to AI… and the list goes on.
While George believes every investor should own shares of typical 5G stocks like Samsung, Apple, T-Mobile and Qualcomm…
He also recommends you NOT buy another 5G stock until you read this message in full…
Because a rare window in the tech market’s just opened up… giving you the chance to grow much richer, much faster.
Check it out for yourself while this window of opportunity is still open.]
Time for banks’ annual checkup: The Fed put banks on the ol’ stress-test treadmill to see how they’d withstand an imperceptible heart attack. But how ’bout a heart-stopping pandemic?
In a blanket Fed statement, banks were found… lacking. As CNBC put it, “Several banks could get uncomfortably close to minimum capital levels in scenarios tied to the coronavirus pandemic.”
The Fed’s prescription: “Big banks will be required to suspend share buybacks and cap dividend payments at their current level for the third quarter of this year,” CNBC says.
Not only that, but “for the first time in the decade-long history of the stress test, banks will have to resubmit their payout plans again later this year, and restrictions on payouts could remain in effect. They may have to repeat this cycle every quarter.”
Of course, we wonder if the stress on banks started long before the pandemic, with souring corporate debt — something former Wall Street banker Nomi Prins warned us about 18 months ago.
Something else we found interesting? The Fed issued a blanket statement and didn’t break out results from any individual bank. Fair to ask what they don’t want us to know?
Bank stocks rallied hard Thursday after FDIC loosened some restrictions. Not so much today… Shares of Wells Fargo are down almost 7%; the same goes for Goldman Sachs. And Jamie “take a knee” Dimon’s JPM stock is down 5% (see “virtue signaling” below).
Providing some context for the market today, our CBOE trading vet Alan Knuckman says, “The financial media are taking full advantage of the market’s sudden drop and milking the virus story, along with additional concerns about the viability of some states’ reopening plans.”
Predictably, then, the Dow’s down 530 points to 25,200. The other two major indexes — the S&P 500 and the Nasdaq — are each down about 1.5%.
Checking in on commodities, crude is down marginally to $38.39 for a barrel of West Texas Intermediate, while gold’s up $10.60, to $1,780.20 per ounce.
The Commerce Department’s “income and spend” numbers are out today, and personal spending jumped 8.2% in May… after dropping a revised 12.6% in April.
But don’t call it a comeback? That’s still less than the 9.3% economists anticipated.
Meanwhile, personal income slumped 4.2% after rising 10.8% in April when hordes of Americans received their federal stimulus checks.
While spending bounced, Americans continued to deposit money in savings and pay down debt. The savings rate in May was still high — at 23.2% — but less than April’s 32.2%.
Cash-strapped state and local governments across the country are weighing their options when it comes to closing vast budget deficits because of the corona-crash.
And for politicians — heh… read my lips — raising taxes is tantamount to political suicide. “No politician wants to lead with raising taxes,” says Mark Mazur, director of the Urban-Brookings Tax Policy Center. “When they get there, it’s because they’ve run out of other options.”
So spinning the tax revenue wheel, will municipalities raise property taxes? Add more vice taxes? Or even go after big tech companies? All of the above… and more.
According to The Washington Post: “Philadelphia increased fees on parking and raised wage taxes on workers who reside outside the city.” Meanwhile, “Chicago Mayor Lori Lightfoot (D) said this month she couldn’t rule out a property tax increase to cover her city’s $700 million budget shortfall.”
In line with increasing property taxes: “Nashville leaders even took the eye-popping step in June to increase property taxes by about 34%, a move meant to help pay down rising public education costs — and one that quickly sparked a public outcry.”
Here’s the rub, says the Post: “Unlike the federal government, which can cut taxes and rack up huge deficits with impunity, localities generally must balance their budgets each year.”
And because of the pandemic’s heavy burden on state and local government coffers, budget cuts alone aren’t going to, well, cut it.
“City and state officials have spent months pleading with federal lawmakers to authorize as much as $1 trillion in new aid to help them close their deficits and stave off the worst economic consequences of the coronavirus pandemic.” To no avail…
So states are getting creative; for example, over 100 senators and members of New York’s state assembly signed a letter insisting the state raise taxes for high-income earners to fill a $17 billion budget black hole. Empire State lawmakers further proposed new taxes on big tech companies’ “collection and sale of consumers’ online data,” the Post reports.
Meanwhile, Georgia and Colorado are eyeing up potential vice-tax revenue. The first tax hike on cigarettes — in decades — is on the table in Georgia. And Colorado is taking it a step further: “[planning] to raise taxes on nicotine and vaping products, which is expected to raise more than $80 million in revenue next year.”
Jared Walczak of the Tax Foundation says: “There’s going to be a sense in which any sectors that look comparatively healthy will be attractive targets for taxation over the next couple of years.”
Interpretation? When it comes to new SALT taxes and weird fees… it’s all fair game.
“I ponder two questions,” says a longtime reader. “With the recent import of 22 million ounces of physical gold signifying a tremendous demand surge…
“1. Why did the price barely move?
“2. Why did sophisticated buyers bring gold to New York for storage, where it is public and traceable and subject to government taxation or confiscation?
“Here’s a distinct possibility: Dems win in November and need money to fund all their socialist promises.
“This also, by the way, challenges your ‘they are not coming after your wealth’ tongue-in-cheek premise.”
The 5: We don’t think Dave was speaking tongue in cheek… That’s not to say wokesters won’t circle back to their redistribution of wealth agenda.
However, with global elites falling over themselves with hollow virtue signaling — and committing pocket change to approved causes — the wokened are mollified. For now.
And sir… How about not giving ’em any ideas?
“While I do not support the EARN IT Act as proposed, your assertion that we now have a ‘free speech’ internet is truly naive. I think you know better.
“Section 230 needs to be revised in a way that will discourage Twitter, Facebook and Google from imposing their form of censorship with legal impunity.”
The 5: We have no illusions about the interwebs… but we’re following the EARN IT Act breadcrumbs to where it’s not just free speech up for grabs. At stake? The feds stampeding your reasonable right to privacy.
And if the government can access your most personal information, hackers can do it too. Only faster.
“I couldn’t help thinking you missed a perfect opportunity in your ‘Government in Action’ article yesterday,” another reader says.
“I expected you to ask: With that much stimulus, how many of those 1.1 million dead souls were brought back to life?
“Regarding the Treasury Department’s audit by the GAO, nothing will come of it.
“I expect trying to track down anything in the U.S. Treasury is like sending someone into a maze blindfolded in the dark (just for good measure) and hoping they make it to the center.
“Not a chance.
“Keep up the good work!”
The 5: As far as we know, stimulus checks didn’t revive the dead. The same might be said for most of the living too.
Per our reader’s scenario, we recommend tying ropes around the ankles of GAO investigators… or at least getting the missing posters ready.
Best regards,
Emily Clancy
The 5 Min. Forecast
P.S. Exclusively for Platinum Reserve members: Executive publisher Addison Wiggin just wrapped a briefing with Graham Summers, author of The Everything Bubble: The Endgame for Central Bank Policy.
For your members-only briefing, check your inbox at 10 a.m. for an email with the subject line “Part 12, Going Live Now.”
