[Intime News]
In the last five years “we have changed the business environment in Greece, we have recovered what we lost in the crisis, we have obtained investment grade and we have recorded high growth rates,” Deputy Minister of National Economy and Finance Nikos Papathanasis said on Thursday at the 28th Annual Economist Government Roundtable in Athens.
(Bloomberg Opinion) — Central bankers aren’t born as chronic worriers, but they quickly acquire the trait. They are now spending considerable time fretting about artificial intelligence: Its ability to play havoc with prices, jobs, and the security of banking. As gut-wrenching as the meltdown of 2008 was, imagine if a rogue machine turbocharged a market rout.
It’s not quite a doomsday scenario where AI runs amok and destroys the Earth, said Eddie Yue of the Hong Kong Monetary Authority at a recent conference. But there are plenty of dangers emerging, he added. Yue’s counterpart in Singapore warned of the potential for fraud and cyber attacks. American and UK officials are fearful that algorithms will be used to curtail lending to minorities. While acknowledging the benefits of rapid technological advances to the overall economy, most are wary.
One thing the lords of finance shouldn’t stress about is dilution of their power. Sure, the legions of Ph.D economists that staff central banks may thin. New algorithms that sift real-time data on everything from car sales to foot traffic at malls will rightly push analysts to think about how their roles will transform. But rather than make the men and women who actually set interest rates redundant, AI could make them mightier citizens.
The Bank for International Settlements declared as much, saying that the most basic of tasks, deciding borrowing costs, will still be done by mortals. HAL, the computer that assumes God-like qualities in the film 2001: A Space Odyssey, isn’t coming for the Federal Open Market Committee and its global peers. “The ways we organize ourselves and our societies are that we like to hold human beings accountable,” Cecilia Skingsley, head of the Innovation Hub at the BIS, told reporters last month. “You know, changing politicians, possibly changing central-bank governors from time to time.”
She may be lowballing it. The importance of Federal Reserve Chair Jerome Powell and his cohort may only grow. As retailers develop applications to keep ever closer tabs on competitors and broader markets, the price of milk in Denmark, for example, may fluctuate during a press conference by Powell, argues Lars Christensen, an associate professor at the Copenhagen Business School. When OPEC raises or cuts oil production, that’s very quickly reflected in the price of gasoline at the roadside. Why shouldn’t the same apply to basic food staples, asks Christensen, cofounder of PAICE, a consulting firm specializing in AI and data analysis.
“In many high-income countries, we already have electronic price tags,” he told me. “You might as well plug them into an algorithm. I don’t think my example of standing in a supermarket watching the price of milk change on the screen as Powell announces rates is unrealistic. For practical reasons, we might change the price only when the supermarket closes or you might have a mechanism that says the price can’t be increased while the customer is in the store. The concept is there.”(1)
Utterances from a generation ago can be resurrected to provide bond-market signals, thanks to a ChatGPT-based language model. JPMorgan Chase & Co. built a program that uses speeches dating back decades to detect the evolution of policy signals. The bank’s economists discovered that when the model showed a rise in inflation concern among Fed speakers between meetings, the following FOMC statement had grown more hawkish. The opposite is also true. Turn that into a trading strategy and the opportunities for a payday are plenty. Initially tracking the Fed, European Central Bank and Bank of England, JPMorgan expanded the method to 10 major developed-market central banks.
There’s always room for nuance and considered opinion. Sometimes the signals aren’t especially clear. For example, how do you interpret the Reserve Bank of Australia’s phrase du jour, “We aren’t ruling anything in or out?” A career Bundesbank policymaker might be less inclined to ease than, say, someone from the Bank of France. Bank of Japan Governor Kazuo Ueda can veer off on tangents. His predecessor delighted in surprising investors.
AI works best when complementing human judgment. In some arenas, there is no substitute for experience. The machines helping reduce tax evasion in Turkey perform a public service, for example. Still, nobody would consider the country a gold standard for performance: Inflation is a stratospheric 72%. There needs to be a combination of electrons and brain waves.The employment mandate of central bankers themselves is unlikely to disappear. If Donald Trump wins this year’s presidential election, he’s pledged not to re-appoint Powell, who may not even want a third term. Safe to say HAL won’t make the shortlist — this time.
More From Bloomberg Opinion:
(1) Christensen discussed the subject at length in George Mason University’s Macro Musings podcast last month.
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
Daniel Moss is a Bloomberg Opinion columnist covering Asian economies. Previously, he was executive editor for economics at Bloomberg News.
More stories like this are available on bloomberg.com/opinion
‘Kudlow’ panelists Kevin Brady, Art Laffer and Sandra Smith discuss how ‘Bidenomics’ is falling flat with voters.
Credit cards are a ubiquitous part of American finances as individuals seek ways to gain financially for the present and future.
Regardless of age or income, credit card use is customary in the United States. In 2023, 82% of US adults had a credit card, according to the Board of Governors of the Federal Reserve System.
Some people use credit cards and pay off the balance each month while others build up substantial credit card debt and carry a balance with a significant amount in interest.
BEST REWARDS CREDIT CARDS AND HOW POINTS CAN BE REDEEMED FOR TRAVEL, CASH BACK OR GIFT CARDS
Although there is substantial debate regarding whether credit card use is beneficial or detrimental to one’s financial well-being, the 82% who chose to open a credit card for one reason or another believed it would have a positive impact on their financial state.
Many credit card companies offer cash back, reward points and other incentives for opening a line of credit with them as the lender. (Photo Illustration by Justin Sullivan / Getty Images)
Whether you are considering opening your first credit card or are looking for ways to make use of your well-swiped plastic, knowing why and how they are used by those who believe credit cards are profitable for financial success can help.
Here are some of the ways that eight in 10 adults who own credit cards use them:
Many credit card companies provide incentives like earning cash back or accumulating bonus points and travel rewards on purchases. With each use of the card, you’re rewarded according to the card’s terms. These purchases typically cover everyday expenses, such as groceries and fuel. The more you spend, the more rewards you can rack up.
However, only spending within one’s means has proven harder than ever with credit card use.
CREDIT CARD DEBT POISED TO SMASH ANOTHER RECORD HIGH
Many credit card holders use them to aid their credit score and to build credit history. ( / iStock)
Americans’ credit card debt has soared to a staggering $1.13 trillion, as reported by the Center for Microeconomic Data’s Quarterly Report on Household Debt and Credit. On a personal scale, Experian notes the average debt per borrower stands at $6,501.
Is financing a ski trip or tropical getaway with a credit card a good option, or should you fund it from savings?
Some credit card companies offer incentives for specifically using their card to book travel. Depending on which credit card you have, you can accumulate a certain amount of travel points by booking with the card.
Choosing a credit card with an airline can increase the rate at which you earn points. If the airline is a member of an alliance, such as Star Alliance, SkyTeam or Oneworld, those points can be redeemed with an airline included in the alliance, according to nerdwallet.com.
HOW TO MAXIMIZE YOUR CREDIT CARD REWARDS
Many credit card lenders provide various forms of travel insurance for trip cancellation, baggage loss and rental cars as a stated benefit. (Sam Hodgson/Bloomberg via / Getty Images)
The rate at which points are collected, however, is relatively low, and it can take a while to earn enough points for the free travel credits.
“For most cards, every dollar you spend equals one travel mile. But when you’re trying to redeem them, each mile is worth about a penny, depending on the kind of card you have,” says the Ramsey Solutions website.
The allure of a free flight may lead to overspending to earn the needed points. Additionally, paying for a trip that you wouldn’t be able to fund with your current savings can lead to financial havoc.
HOW TO EARN CREDIT CARD POINTS, MILES FASTER
Online shoppers often use credit cards instead of debit cards to earn reward points, miles and cashback on their purchases. But studies show that consumers tend to spend more with purchases when using a credit card. (iStock / iStock)
One strategy that consumers take to earn rewards is to automate recurring payments with the credit card. Subscriptions, memberships and payment plans can all be set up with monthly withdrawal from the credit card.
The danger is the allure of introductory offers and trial periods. The consumer will be at a disadvantage while the company profits if they complete the initial sign-up process, forget about it and don’t track expenses on the credit card.
A primary reason that some individuals open a credit card is for business expenses. This strategy helps them separate personal and business spending for easier tax preparation.
Business owners frequently receive rewards and offers for small business credit cards, enticing them to pursue their dreams with the promise of profit.
Many small business owners use their credit cards to support their businesses and pay off debt when they begin to profit. (SouthWorks / iStock)
THIS IS HOW TO PROTECT YOUR CREDIT AND BANK CARDS FROM GETTING HACKED
Business owners should read the fine print carefully before jumping in. In many cases, they are expected to pay off the credit card balance within the introductory period to avoid steep fines and interest rates. Additionally, there is often a required minimum amount that must be spent on the card within this period to qualify for the card’s perks.
Small businesses are also enticed with credit cards because of the ability to earn rewards specific to business needs. Some rewards start to accumulate right away, such as cashback offers, and others require a minimum amount spent to qualify.
GET FOX BUSINESS ON THE GO BY CLICKING HERE
A consideration to make before maxing out your business’ credit card is that sales and consumer trends tend to ebb and flow. Using a credit card to pay business expenses and benefit from the perks is a great plan as long as everything is going perfectly, Dave Ramsey explains on his talk show. The talk show host describes this risk as “playing with snakes.”
“We hope Cathay Pacific Airways will continue to improve service quality and support and enhance Hong Kong’s status as an international aviation hub,” Chan wrote in his weekly blog.
“Looking forward, local airlines should actively expand their route networks in response to the needs of economic development, business connections and public travel and facilitate the country’s Air Silk Road strategy.”
The “Air Silk Road” is the aviation connectivity part of President Xi Jinping’s Belt and Road Initiative, a China-centred trade network covering more than 100 countries.
Chan said the aviation corridor would spur bilateral trade with these countries.
Xia urged the authority, which manages the international airport, to leverage its unique advantages under the “one country, two systems” governing principle and to continue contributing to national development.
The financial secretary said he also expected more business exchanges and closer ties between Hong Kong and the Middle East after Cathay relaunched a direct flight to the capital Riyadh in October.
The relaunch will come months after a connection between the kingdom and Shenzhen, which got its first non-stop flights to the city on June 3 via China Southern Airlines, while Guangzhou also has direct services to Kuwait and Riyadh.
“More convenient transport between the two places will definitely strengthen closer exchanges between the two markets, bring together more new funds and create more new opportunities for Hong Kong’s financial market,” he said.
Cathay announced on Friday that it would buy back the remaining half of preference shares issued to the government, worth around HK$9.75 billion, and pay remaining dividends amounting to HK$2.44 billion up to July 31.
The shares were part of a government-led bailout in 2020 with a HK$39 billion recapitalisation package for Cathay, as the airline financially struggled amid a collapse of the global travel market.
The first half was bought back in December last year.
Chan said in his blog Cathay’s ability to fully take back the shares “marked the steady return of Hong Kong’s aviation industry to full normality”.
The finance chief said that, in 2020, the government had taken into account the overall interests of Hong Kong society, especially the need to maintain the city’s status as an international aviation hub, before investing HK$27.3 billion, comprising HK$19.5 billion for preference shares and HK$7.8 billion in bridging loans, in Cathay.
“This special investment arrangement made under such an extraordinary period achieved win-win results,” he said.
“On the one hand, Cathay gained financial liquidity, was able to survive its difficulties, and restore capacity fairly quickly.
“At the same time, this investment brought a return of nearly HK$4 billion to our coffers.”
Cathay in March reported a net profit of HK$9.78 billion last year, its first since 2019, after a net loss of HK$6.62 billion in 2022.
The company earlier pushed back its original plan to return to 100 per cent passenger capacity from the end of 2024 to the first quarter of 2025.
The Post has contacted Cathay for comment.
Tension and stand-offs as South Africa struggles to launch coalition gov’t
The many faces of Donald Trump from past presidential debates
First 2024 Trump-Biden presidential debate: Top clashes over issues from the border to Ukraine
4 killed, 9 injured after vehicle crashes into Long Island nail salon
Supreme Court denies Steve Bannon's plea to stay free while he appeals
Video: How Blast Waves Can Injure the Brain
Trump says 'biggest problem' not Biden's age, 'decline,' but his policies in first appearance since debate
Increasing numbers of voters don’t think Biden should be running after debate with Trump — CBS News poll
