Eoin Treacy's view

A link to today's video commentary is posted in the Subscriber's Area. 

Some of the topics discussed include: China's advantage in EVs, oil continues lower despite sensational stories, stocks steadier on bond weakness, Dollar eases, gold steady. 

The difference is that ChatGPT is not actually running python and determining the first 10 prime numbers deterministically: every answer is a probabilistic result gleaned from the corpus of Internet data that makes up GPT-3; in other words, ChatGPT comes up with its best guess as to the result in 10 seconds, and that guess is so likely to be right that it feels like it is an actual computer executing the code in question.

This raises fascinating philosophical questions about the nature of knowledge; you can also simply ask ChatGPT for the first 10 prime numbers:

Those weren’t calculated, they were simply known; they were known, though, because they were written down somewhere on the Internet. In contrast, notice how ChatGPT messes up the far simpler equation I mentioned above:

For what it’s worth, I had to work a little harder to make ChatGPT fail at math: the base GPT-3 model gets basic three digit addition wrong most of the time, while ChatGPT does much better. Still, this obviously isn’t a calculator: it’s a pattern matcher — and sometimes the pattern gets screwy. The skill here is in catching it when it gets it wrong, whether that be with basic math or with basic political theory.

Eoin Treacy's view

The probabilistic versus deterministic issue boils down to the problem all models face; quality of data. The best way for a chatbot to function is to only use a confined sample of reliable answers. In other words for an answer that is sure to be correct, the dataset has to be filled with deterministic infallible answers.

Late last month, Turkey announced that passing tankers would have to provide letters from their insurers proving they were covered to navigate the straits, through which almost 700 million barrels of crude flowed in the past year. Turkey’s move was a response to European Union sanctions against Russia that bar insurance of vessels if the oil they’re carrying costs above $60 a barrel.

‘Unacceptable’

US and UK officials have been pushing for Turkey to reconsider the proof-of-insurance requirement, especially given that cargoes from Kazakhstan are not subject to sanctions. 

“We’ve been in touch with Turkey about how the price cap only applies to Russian oil, and explained that the cap doesn’t necessitate additional checks on ships passing through Turkish waters,” US Treasury spokesman Michael Gwin said. “Our understanding is that virtually all of the delayed tankers are not carrying oil from Russia and are not affected by the cap.”

Still, Turkey said it was “unacceptable” for protection and indemnity clubs that insure risks including collisions and spills not to provide confirmation letters to their commercial customers. 

“This letter demanded by us is only about confirming that the ship’s insurance is valid during its passage through Straits,” the ministry said.

Turkey is working on a separate solution for ships without letters that were bound for Turkish refineries, the ministry said, citing “public good and national interest.”

Eoin Treacy's view

Turkey appears to be taking a leaf out of Singapore’s playbook. As pipeline supply to Europe slows down, Turkey has a clear incentive to position itself as a major centre of refining and as an oil and gas pipeline terminus. That also suggests Turkey will soon break ground on LNG export facilities. This is not a new idea. There has been talk of Turkey being a major energy hub for at least a decade. 

China’s Contemporary Amperex Technology, the world’s biggest maker of electric-car batteries, signs a global partnership agreement with Honda Motor, according to an exchange filing to Shenzhen Stock Exchange.

Eoin Treacy's view

China has worked hard to capture the market for EV batteries and that is now paying dividends. Traditional car companies all now want to be EV companies but are years behind in building their own factories and supply chains. That is most especially true for batteries. China has a dominant position in mining and processing the respective raw materials. The implication is clear, there is no way for car companies to achieve their EV goals without outsourcing at least part of the process to Chinese companies.

Eoin Treacy's view

One of the questions subscribers ask most often is how to find details of my open trades. To make it easier I will simply repost the latest summary on a daily basis until there is a change.