🤖 AI Regulation Just Got Hit With...?

Good morning. US stock futures dipped in Monday morning trading as Wall Street marked the end of a better than expected quarter.

🤖 California Governor vetoes AI regulation bill

📝 Our report: Guess we’ll have to wait a bit longer for the robots to get their rulebook! California Governor Gavin Newsom just nixed a groundbreaking AI regulation bill, which could have set the toughest AI rules in the U.S.

 🔑 Key points:

• The measure, known as the Safe and Secure Innovation for Frontier Artificial Intelligence Models Act (SB 1047), would require safety measures from companies that spend more than $100 million to train AI models.

• In his veto message, Newsom said SB 1047 is "well-intentioned," but it "does not take into account whether an AI system is deployed in high-risk environments, involves critical decision-making or the use of sensitive data. Instead, the bill applies stringent standards to even the most basic functions — so long as a large system deploys it. I do not believe this is the best approach to protecting the public from real threats posed by the technology.”

• Regulating the technology has been a flashpoint in Silicon Valley and beyond. OpenAI, Google and Meta publicly opposed the bill. Anthropic, backed by Amazon, cautiously supported it after suggesting amendments to its original version.

💡 So what: California Governor Gavin Newsom's veto of the AI regulation bill delays efforts to create a robust framework to govern large-scale AI technologies. This move stalls the establishment of safeguards addressing ethical concerns like privacy and job loss. It suggests that California is prioritizing tech innovation over immediate regulation, influencing other states and possibly the federal government to follow suit. In the meantime, AI companies will likely continue to self-regulate, keeping the debate on balancing innovation and responsible use in limbo.

Monday - Federal Reserve Chair Jerome Powell Speaks

Tuesday - Construction spending

Wednesday - Federal Reserve Governor Michelle Bowman Speaks

Thursday - Minneapolis Fed President Neel Kashkari Moderates Discussion With Atlanta Fed President Raphael Bostic

Friday - U.S. Unemployment Rate

📈 Charlie Munger shares these 4 investing lessons!

💰 Do you have a “rainy day” fund?

🏡 Thinking about investing in real estate? Consider these 6 points!

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🛥️ US East Coast ports gear up for strike

WHAT: Prepare for some supply chain snarls and delayed shipments! A port strike on the U.S. East Coast and Gulf of Mexico is officially set for this week, according to the International Longshoremen’s Association (ILA).

WHY: “United States Maritime Alliance ... refuses to address a half-century of wage subjugation,” the union said in a statement. The United States Maritime Alliance, known as USMX, represents employers of the East and Gulf Coast longshore industry. If union members walk off the job at ports stretching from Maine to Texas, it would be the first coast-wide ILA strike since 1977.

🤖 OpenAI’s losses mount

WHAT: OpenAI, maker of ChatGPT, is reportedly looking at $5 billion in losses this year, despite pulling in $3.7 billion in revenue according to reports from CNBC. The company, which is backed by Microsoft, is currently pursuing a funding round that would value the company at more than $150 billion, people familiar with the matter have told CNBC.

WHY: OpenAI’s services have exploded in popularity since the company launched ChatGPT in late 2022. The company sells subscriptions to various tools and licenses its GPT family of large language models, which are powering much of the generative AI boom.

🚀 SpaceX launches mission to rescue stranded astronauts

WHAT: SpaceX is sending a smaller crew to rescue the two stranded astronauts on the International Space Station—but the catch is they’ll have to stick around until next year before they can finally head home. The capsule rocketed into orbit to fetch the test pilots whose Boeing spacecraft returned to Earth empty earlier this month because of safety concerns.

WHY: By the time they return, the pair will have logged more than eight months in space. They expected to be gone just a week when they signed up for Boeing’s first astronaut flight that launched in June. NASA ultimately decided that Boeing’s Starliner was too risky after a cascade of thruster troubles and helium leaks marred its trip to the orbiting complex.

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