We generated this image using DALL-E and the prompt “an oil portrait of a Shiba Inu wearing a business suit and holding an iPhone, in the style of Claude Monet.”

Last Week’s Market Moves

Dow Jones
32,862 (+5.72%)

S&P 500
3,901 (+3.95%)

Nasdaq
11,102 (+2.24%)

Bitcoin
$20,601 (+7.45%)

“Generative AI” is booming, and it’s revolutionizing the way people make art — and money

Memes become Monet paintings… A new kind of AI is transforming the way people create art and do business. Generative AI uses deep learning and tons of data to convert text prompts into images, videos, and articles. We made the image above using gen-AI and a text prompt.

• Main character: OpenAI, which has raised billions from Microsoft and others, launched the first major gen-AI tool, Dall-E, last year. It was released to the public last month, and Reddit’s already filled with viral Dall-E creations.


• Other players: Stability AI raised $100M this month (at a $1B+ valuation) for its open-source gen-AI tool, Stable Diffusion. Meta, Google, Salesforce, and Adobe have built in-house gen-AIs, too, but they’re not publicly available.

Goofy images were only the start… Now entrepreneurs are putting gen-AI to work. 140+ gen-AI startups have launched in recent months: Jasper, which makes AI-generated blog posts, raised $125M at a $1.5B valuation last week. Companies can use it to automate copywriting (think: “a promotional post about air fryers in a friendly tone”). Other startups are auto-generating clothes, floorplans, and ad jingles. Microsoft added Dall-E to its design tools, and Shutterstock plans to use it to make stock images. But ethical concerns abound:

• Payment problems: Critics say gen-AI doesn’t compensate artists who create the content that “feeds” its algorithms (though Shutterstock has a “contributor” fund).


• Harassment hitches: Dall-E has safeguards, but some argue that gen-AI can still be used to produce celeb deepfakes and misinfo. Others say it replicates biases, like sexist imagery.


• Automation anxiety: Some fear gen-AI will put writers and designers out of work (others disagree).

   THE TAKEAWAY

Highly visible = highly valuable… AI has many existing applications (think: self-driving cars, disease diagnosis, fraud protection),but it often operates behind the scenes. And yet generative AI has an accessible wow factor that’s already dazzled many. Some investors say it’ll be a huge industry: prominent VC firm Sequoia predicted that gen-AI could generate “trillions in value” and revolutionize industries that require humans to create original work.

Coming up this week...

Dressed up as Jerome Powell… because interest rates are terrifying. To be the Fed chair all you need are hiking clothes: America’s central bank is expected to raise rates by a “jumbo” 75 basis points on Wednesday — the fourth straight bump of that size. Soaring borrowing costs are spooking investors and raising recession red flags. Last week mortgage rates topped 7% for the first time in 20 years. But economists polled by Reuters said the Fed shouldn’t pause its hiking crusade till inflation drops to around half of its current level (a hot 8.2%).

Winter’s coming… While consumers are still feeling #PumpAnxiety, oil giants are still pumping record profits. Last week Exxon, Chevron, and Total demolished earnings with record results (Exxon took home a $20B profit). Analysts expect Marathon Petroleum and ConocoPhillips to deliver strong results when they report this week. Global oil and gas supplies are still tight from pandemic-era output cuts and the war in Ukraine. Now President Biden is urging Big Oil to boost production (and cut buybacks) ahead of winter.

Stories we’re watching...

Well, that was underwhelming… Tech stocks plunged last week after uninspiring third-quarter earnings. Google’s sales growth slowed big-time as ad spending sagged, while Meta’s revenue dropped for a second straight quarter (and profit plunged 52%). What really turned investors off: weak forecasts for this holiday quarter. Amazon expects sales to be up just 2% to 8% from last year (a major slowdown). As tech forecasts fall back to earth, investors are adjusting their expectations. Then again, lower expectations might mean less market disappointment.

Trick or treat… But retailers aren’t spooked by candy-flation. Go-tos like Walmart, Costco, and Lowe’s widened their spooky selection by about 20%. This year Halloween spend is expected to hit a record $10.6B ($2B more than prepandemic), with Americans paying an average of at least $100 for goodies like fun-size candy bags, pumpkin plates, and wacky wigs (FYI: Home Depot sold out of its viral $200 life-size skeleton in one day). Hershey is thriving on its sweet-and-salty strategy and expects Halloween candy to make up 10% of its annual sales.

Last week's highlights...

• Jeezy: After 19 days of public backlash, Adidas ended its partnership with Kanye West’s Yeezy (nearly 10% of its revenue) after he made antisemitic statements. Balenciaga, Gap, Foot Locker, and CAA also dropped ties with West.


• Zucked: It was a rough week for Meta, whose shares have plunged 28% after it reported "train wreck" earnings. Investors weren't sold on Zuck's vision of the metaverse, or the company’s $15B splurge on it.


• Feast: YouTube star MrBeast is said to be seeking a $150M investment to boost his empire, from viral videos to Beast Burgers. VCs interested in access to his 107M+ YouTube subscribers may see it as "fans as a service.”

What else we're Snackin'

• Tweelon: Elon Musk completed his Twitter purchase, and then fired company execs including the CEO, CFO, top policy expert, and general counsel. The billionaire told advertisers the site wouldn't become a "hellscape," though GM’s already suspended its tweet ads.


• CryptoStuff: Crypto is confusing, but what if it was… less so? Bloomberg reporter Matt Levine dropped a book-length explainer on all things crypto that could be quoted at cocktail parties for years to come.


• WAO: Regulators charged a decentralized-crypto collab known as a DAO (picture: ants coordinating without a queen) with financial crimes, saying every member was liable. It could set an important crypto precedent.

Snack Fact Of the Day

Candy corn was originally called “Chicken Feed” and came out when farmers made up half of the US labor force

Read more

This Week

• Monday: Earnings expected from Aflac, NXP Semiconductors, ON Semiconductor, and Avis


• Tuesday: Earnings expected from Eli Lilly, Pfizer, BP, AMD, Sony, Mondelez, Airbnb, Marathon Petroleum, Uber, Public Storage, and McKesson


• Wednesday: The Fed’s interest-rate announcement. Earnings expected from Qualcomm, CVS, Booking, Estee Lauder, GSK, Humana, MetLife, Ferrari, Allstate, Yum! Brands, and eBay


• Thursday: Jobless claims. Earnings expected from ConocoPhillips, Amgen, Starbucks, PayPal, Cigna, Regeneron, Moderna, Monster Beverage, Warner Bros Discovery, Block, Barrick Gold, Kellogg, and Live Nation


• Friday: Earnings expected from Enbridge, Duke Energy, Dominion Energy, and DraftKings

Authors of this Snacks own: shares of Amazon, Block, Google, Microsoft, Walmart, Exxon, Starbucks, CVS, Moderna, Twitter, GM, and Uber

ID: 2564759

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