GM and BRRR.

Today, we're talking about the teetering Jenga tower that is commercial real estate, AWS' scramble to stay in the AI marathon, and the IMF's realization that banning crypto is as effective as a diet plan consisting solely of donuts.

First up, the US commercial real estate scene looks like a Titanic meets iceberg scenario (too soon?). $64 billion worth of distressed properties and $155 billion more teetering on the edge, mostly thanks to the deadly combo of higher borrowing costs and the aftermath of bank collapses. It's got us on the edge of our seats - just not in the offices that are distressingly empty. The WFH movement has triggered a “distressed” label for nearly $43b in office space alone. (Read more)

So we ask…👇

Next, we've got Amazon tossing $100 million into the generative AI ring - a sum that makes you go 'oh, how cute' considering their hefty cash pile. But hey, it's a start and keeps them in the AI race with Microsoft and Google. A little more than a leg in the race but not quite a sprint yet. On top of that, they're busy hiring and building chips to keep the AI machine well-oiled and ready to rumble.

And finally, we find the IMF gently pointing out that trying to ban crypto is like trying to bottle a thunderstorm: well-intentioned, but ultimately useless. They argue the focus should be on addressing why people want crypto in the first place - a revelation about as shocking as finding out water is wet.

Strap in, it's going to be a bumpy ride.

Let’s get after it.

AI: The Money Robots

AWS Throws Hat in AI Ring, Pledges $100M

• AWS invests in generative AI: Amazon’s cloud unit, AWS, is throwing $100 million into a generative AI center - essentially an after-school club for companies wanting to dip their toes into the AI pool. Compared to Amazon’s hefty cash reserves and operating expenses, this feels like a ‘small change found under couch cushions’ kind of investment.

• Staying in the AI race: With this move, AWS is making sure they have a seat at the ‘generative AI’ table, along with rivals Microsoft and Google. As AWS CEO Adam Selipsky put it, “we’re only three steps into a 10K race”, suggesting that the AI marathon has only just started and AWS is geared up for the long haul.

• New additions to AWS’ workforce: As a part of this investment, Amazon’s increasing its headcount by bringing in new data scientists, engineers, and solutions architects. The center, which according to AWS is more of a ‘program’ rather than a physical center, is already in collaboration with companies like Highspot, Twilio, RyanAir, and Lonely Planet.

• The AI chip demand conundrum: Amazon’s currently wrestling with the demand for AI chips. They’re building chips to supplement Nvidia’s GPUs while both are scrambling to satisfy market demand. Selipsky is optimistic that people’s impatience will get some relief in the next few months as the compute capacity for generative AI increases. Meanwhile, he admits that AWS is grappling with a slowdown in cloud spending due to economic uncertainty, but he remains bullish on AI’s transformative potential for the cloud.

  Read more

Public companies mentioned: AMZN

Our take: Long an AI implementor across its operations, Amazon hasn’t made splashy announcements as the gen AI hype built this year. We expect this to change soon, and for the market to fawn over Amazon’s plans.

Crypto: Digital Gold Rush

Crypto Ban? IMF Says 'No Gracias', Advocates Regulation

• IMF advises against crypto ban: The International Monetary Fund (IMF) has tossed a wet blanket on the idea of banning cryptocurrencies outright. While they advocate for crypto regulation in specific countries, they reckon that a total ban could be about as useful as a chocolate teapot in the long run.

• Crypto popularity surges in Latin America and the Caribbean: The IMF’s June 22 report showed a growing fondness for digital assets in these regions, with countries like Brazil, Argentina, Colombia, and Ecuador racing to get on the crypto bandwagon. From helping the unbanked to facilitating quicker, cheaper payments, cryptocurrencies are getting the red carpet treatment.

• Embrace of Central Bank Digital Currencies (CBDCs): The report highlights that several central banks are flirting with the idea of launching their own CBDCs. For those living in Latin America and the Caribbean, CBDCs, if done right, could be the knight in shining armor, enhancing payment system efficiency, resilience, and inclusivity.

  Read more

AI ART OF THE DAY

The BRRR’s Portfolio

Everything down today, but AMZN and BTC holding up the best.

On Watchlist:
$ASML: AI Supply Chain
$AI: Enterprise AI software
$ADBE: Creativity & productivity software
$ISRG: Robot Surgeons

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The BRRR is meant for informational purposes only. It is not meant to serve as investment advice. Please consult with your investment, tax, or legal advisor before making any investment decisions.