🤖 Elon Musk calls for a pause on AI
🗽 US dollar’s dominance decreasing
🌪 El Nino threatens India’s agro sector
Read Time: 3 mins
1. Elon Sounds the Alarm
Tech heavyweights call for pause on advanced AI development
Elon Musk, Steve Wozniak and others have signed an open letter by the Future of Life Institute calling for a six-month pause on training any AI technology more powerful than OpenAI's GPT-4. The letter warns of potential risks to humanity and society if AI development continues unchecked. The signatories highlight concerns around misinformation, automation in the labor market, and the possibility of a loss of control of civilization.
Six-month pause needed for assessment
The letter asks developers to work with policymakers to create AI governance systems and suggests the need for "well-resourced institutions" to cope with economic and political disruptions caused by AI. The letter also highlights the need for regulatory authorities and AI "watermarking systems" to help people differentiate between human and AI-made content.
Our Opinion: The impacts of uncontrolled AI on the economy could be significant. If AI systems become too advanced and unpredictable, it could lead to widespread job loss as machines replace human labor. Moreover, companies that fail to keep up with the rapid pace of AI development may become obsolete, leading to further economic disruption. Additionally, if AI systems cause significant harm to society, such as through accidents or malicious use, it could lead to legal and financial liabilities for the companies involved.
2. Oil for Chinese Yuan: Saudi's Shift
Saudi Arabia Considers Pricing Oil Sales in ¥
Saudi Arabia is reportedly considering accepting ¥ for oil sales, in a move that would undermine the US dollar's position as the global petroleum market's dominant currency. China purchases more than 25% of Saudi Arabia's oil exports, and if priced in ¥, those sales would bolster the Chinese currency's standing. The majority of global oil sales, approximately 80%, are priced in $, and the Saudis have traded oil exclusively in $ since 1974. Russia is also considering using the Chinese yuan.
Why is Saudi favouring China
The Saudis have grown increasingly frustrated with decades-old US security commitments to defend the kingdom, and they are considering the petroyuan futures contracts for Aramco. The US relationship with Saudi Arabia has deteriorated under President Biden,on the other hand China's oil imports have swelled over the last three decades.
Our Opinion: If Saudi Arabia prices oil sales in ¥, it could weaken the US dollar's dominance as the primary currency for oil transactions, potentially impacting the global financial system. The move could further strain the US-Saudi relationship and shift the geopolitical balance of power towards China.
3. Threats to India’s Agro Sector
NOAA predicts El Nino in mid-2023
The National Oceanic and Atmospheric Administration (NOAA) has predicted that El Nino could arrive as early as July or August 2023. The beginning of the El Nino is a harbinger of bad news for India’s agriculture. El Ninos are generally linked with poor southwest monsoon rains across India as observed in previous El Nino years of 2009, 2014, 2015 and 2018. The poor monsoons due to El Nino will also impact India’s Kharif crop output and agriculture sector
La Nina and El Nino impact the globe
La Niña and El Niño are opposite phases of the El Niño-Southern Oscillation (ENSO) cycle, characterized by changes in ocean temperatures in the tropical Pacific Ocean that can affect weather patterns worldwide. La Nina and El Nino together form a climate cycle that has an immense impact on weather and ocean conditions across the globe. The cycles of El Niño and La Niña are irregular and can last anywhere from 9 months to 2 years, although the average duration is about 12-18 months. Together, these two phenomena affect ocean currents, fish populations and wind flows. They also often result in more rainfall in some parts of the world while triggering droughts in others
Our Opinion: The impact of La Niña and El Niño on India's agro sector can be significant, disrupting monsoon patterns and leading to droughts or floods, damaging crops, and threatening food security and the economy. It is crucial to monitor and plan for their impact, such as implementing irrigation systems, crop diversification, and insurance schemes, to ensure food security and stable economic growth.