Businesses Using Prediction Markets for Hedging

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Noome Shazir bolted from Google to openp AI, Midjourney unveiled a bizarre full body ultrasound scanner, and businesses are piling into causchi to hedge real world risk. Here's a shiss today in the world of tech Think you have to build your own search engine scraping infrastructure. Thank again, folks. SERP API can take care of all your search engine scraping needs. It lets AI products access real time web search data programmatically No scraping infrastructure required Their APIs offer structured JSON data from all the top search engines, including Google, Amazon, and YouTube Tech companies already use SRP API to power their AI agents, their market intelligence tools, and their automated research workflows See how it can help you and your team SRP API provides two hundred and fifty free searches per month Go check it out at SRPapPi dot com That's SRP SRpapPi dot. comot In an interview, Tim Cook dropped the news that Apple price hikes are in his words, unavoidable to offset surging memory and storage chip costs ording the journ Unfortunately, price increases are unavoidable, he said. We're doing our best to mitigate the huge increases that are being passed to us And we've been trying to shield our customers from the increases, but the situation has become unsustainable App declined offer details on the timing or scale of the planned price increases, nor which products would be affected. Apple's next major product launch is likely to be in September when it releases the iPhone eighteen lineup, expected to include a new foldable iPhone Price increases, especially for Macs and iPads could come sooner Apple raised the starting price of the Mac Mi last month in between launch events Skyrocketing demand for memory and storage chips from artificial intelligence companies has pushed up their costs so much that Apple would have to raise device prices substantially to maintain its profit margins passassing the higher cost on to consumers while maintaining its profit margin would add about two hundred and seventy dollars to the price of the next iPhone Pro model, estimates research firm Tech Insights Chips, for memory and storage are key components inside most computing devices, including smartphones, laptops, game consoles, medical equipment, and even cars But now AI servers are gobbling up rapidly, increasing volumes of those chips. So even a company as rich and powerful as Apple is struggling to secure supply Memory also called DRAM and storage also called NAND like elements of a mid twentieth century office. The memory is a desk that holds all the papers a worker needs to perform a task while storage is the filing cabinet that holds everything else Smartphones use DRAM memory to run apps currently in use, and they use NAand storage to file away photos and videos, for example. Cook said prices for memory and storage are both issues for the company, though he focused on the DRAM market in particular calling out the increased allocations going to so called high bandwidth memory that is used for AI servers There's less supply at a time when consumers went devices and the memory guys are passing along huge price increases, said Cook We definitely need memory pricing and supply to return to reasonable levels for consumer products. That's the bottom line. Three companies dominate the market for DRAM memory, Samsung and SKHix in South Korea and Micron in the US. Makers of NAND storage include those three companies as well as Sosa and Sandisk Their stock prices along with their profits have exploded over the past twelve months. Micron and SK Hix shares have risen more than eight hundred percent Well Shosa and Sandisk have risen four thousand six hundred percent Memory companies are building more factories. Morgan Stanley forecasts that production capacity for DRAM wafers, the silicon discs on which chips are patterned. will thirty percent by twenty twenty seven. yet as suppliers prioritize the specialized AI memory, wafers for consumer tech will fall up to fifteen percent short of demand, Morgan Stanley estimates China has national champion companies in memory and storage, but due to national security rules, American companies would likely require licenses to work with them When asked if those restrictions should be loosened, Cook said, I think everything needs to be on the table, adding, I think we should look at all supply. In the interview, Cook said Apple stands ready to use its cash reserves to boost memory supply. We're willing to use our balance sheet to help be a part of the solution. He said. Obviously, more capacity is needed declined to offer specifics. It is unclear how Apple could match, let alone beat the deal terms that AI hyperscalers are offering to lock up supply Those companies are signing three to five year agreements with huge cash prepayments that Apple is unlikely unwilling to be able to match given its long history of disciplined spending. Cook said Apple wouldn't use its cash and silicon expertise to build its own memory and storage factories either. We can't do everything, said Cook. We know what we're good at, and quote AI researcher Noom Shazer has left Google to join openpen AI as lead for architecture research Rejoined Google as a Gemini co lead in twenty twenty four during the two point seven billion dollars character AI deal quoting the information He then became a tech lead on Gemini, Google's core AI model and made key contributions to the initial development of new generations of the model known as pre training Chazer's hiring is a major win for Open AI in the AI talent Wars as Open AI competes to catch up with Arch rival Anthropics's most advanced models ahead of the two compan's hotly anticipated initial public offerings Shazir was a key author of the original paper on Transformers, which essentially predict the most likely next word in a phrase and is the architecture that OenAI used to underpin its GPT models Opening eye use Trformers to pioneer the chatbot field with Chat GPT, a type of product Shazir had hoped to launch at Google years earlier. In recent years though, Google has narrowed the competitive gap with its Gemini chatot, which has close ties to its dominant web search engine At Open AI Shazer, we willll focus on looking for new architectures for AI models and evolving the transransformer architecture O AI told employees Shazer confirmed his move on X. I'm excited to share that I'll be joining OpenAI and look forward to working with the exceptional team there. He wrote. In a statement, a Google spokesperson said, we are grateful for Nnome meaningful contributions to Google over the years, and we wish him well. Shazir's career has not been without controversy. Shazir's startup character AI agreed to settle multiple lawsuits earlier this year after families alleged character's chatbots contributed to teen suicides and mental health crisises. end quote Basically, if this is the dude that Google essentially paid two point seven billion dollars to Aquaire back a couple years ago And open AI needs someone to lead pre training as their turnaround. This is about open Ae signaling. N one that it isn't just bleeding talent to anthropic anymore, but also It's probably about kneecapping Gemini development to a certain degree as well. For midjourney eararly in the AI frenzy, they were the viral hit for their AI image generation. And then Basically not done much Well, they've done something and it's a bit out of left field Coting the verge Midjourney CEO David Holtz just showed off the company's first hardware product and plans to build a San Francisco spa which he admitted is a bit different from the cat pictures produced by its AI image generator Dubbed the Midjourney sccanner, It's an ultrasound based full body scanner that uses a ring of sensors to capture vertical slices of the inside of your body looking at the composition of your muscle, fat, bone and organs to start Holz said, ideally, you could do this once a year or every single day as it aims for image quality comparable to MRI in some ways He mentioned that one way he'd like to use it would be to see how his body changes in response to diet and workout changes, saying, I'm not the most measured man on Eth yet, you know, but maybe I want to have that daily measurable information A set of job listings advertises the company's goal as trying to build and launch the world's first full body ultrasound CT scanner, ultimately bringing safe fast and highly fidelity preventative scanning to billions via a magical spa experience The scanning process starts with stepping onto a platform that drops down into the water on rails through a ring of thousands of transducers that create ultrasonic waves. It then records the ripples passing through your body to analyze them and create detailed three day images The scan takes about sixty seconds. Holz said about a dozen people have been scanned so far Here's how Midjourney describes it. It starts by stepping into a shallow pool of golden light. You then begin to descend into the water. Your body passes through a ring of underwater sensors, each acting like a dolphin using its echol loocation The sensors send ultrasonic sound waves through your body from every angle. With enough waves and enough angles, we form an image of what's happening inside your body It combines those sensors with two pedap fllops of processing power. But after watching the live stream reveal, I'm still unclear on what Midjourney's AI image generation tech exactly has to do with the Midjourney medical effort beyond an alternative business for otherwise unused AI compute Holz hopes to put ten of the scanners into a midjourney spa location in San Francisco's Union Square that will open before the end of twenty twenty seven and offer to scan the hands of attendees at its launch event. The midjourney spa will have a gym, saunas, and cold plunges to go along with the hot tub equipped scanning rooms where visitors will get into the water to be scanned. He did mention that various medical applications would require FDA clearances, but for now, Midjourney Medical says it's working on body composition maps that don't require the same level of clearance as diagnostic imaging. It also says the library of scans users create can be shared with doctors, AI health tools, or others, and that we take data privacy seriously. moreore details on our data policies will come as we get closer to launch Holt suggested that eventually these scans could become better than an MRI without radiation, powerful magnets, or other complicating factors to get a look at what's going on inside people's bodies real fast. In response to a question, he imagined a future where the FDA had a class of devices to look at weird things and allowed people to just try to get as much data as we can, end quote When an inspiration strikes, you're usually not sitting at your desk ready to take notes. And honestly, some ideas are easier to say out loud than to type into your phone. That's where Plaod NotePin S comes in. 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Lear more at M three sixty five coopilot dot com slash work And fininally, today, the Tes says businesses have started using Calcici to hedge business risks Kalh she says, institutional trading volume on its platform has grown eight hundred percent since November Most people use prediction markets like Kalcici for the kinds of wagers that have made the companies famous, speculating on political races, NBA final games, Taylor Swift's marriage plans, businessusinesses, including major Wall Street firms, are betting that prediction markets can be used for so much more Small businesses, including a New York City beer bar and a specialist sports insurer, have already used Kalcici for hedging their business risks But the platform has spent months hiring training specialists and working with financial firms to lay the groundwork for institutions to do that too The stakes are high, Kalcici has already become the biggest prediction market in the United States, producing seventeen point nine billion dollars in trading volume last month alone, largely from individual betors And it raised one billion dollars last month at a staggering twenty two billion dollars valuation, double its appraised amount in December on the premise that it could supercharge its growth by drawing in hedge funds, brokerages and more Polymarket, its chief rival sold a stake to the parent company of the New York Stock Exchange with a similar aim I think there's a new Wall Street being formed Terek Mansur, a founder and the chief executive of Calsi said in a recent interview, A cornerstone of that bet is building up a way for companies to hedge their risks, a vital business operation normally done in the huge, if usually opaque global derivatives market Small businesses have started using prediction markets that way. ahead of game one of the NBA finals this month, the Jeffrey, a New York City bar, said it would compump many of its customers tabs that evening if the next one As a hedge, it bet five thousand dollars on a Nix victory, which netted the bar just under eight thousand dollars, helping pay for nine thousand five hundred dollars worth of patrons tabs that evening That Cussi hedge worked like a charm. Andrew Friedman, a corporate lawyer who owns the Jeffrey said, Cussi itself had suggested the hedge idea to mister. Friedman This year, Game Point Capital, an insurance company that helps college athletics departments, sports teams and sponsors manage the financial risks of performance incentives in athletes and coaches contracts began hedging through Caowsci as well Here's how it works. Say GamePoint Capital agreed to insure against a golfer's winning the US open and qualifying for a one million dollars bonus. It would bet on Calci that the golfer would win, offsetting its financial risk Historically, GamePoint Capital used specialized insurance providers arranged through markets like Lloyds of London to buy protection Will Hall, a founder and the chief executive of GainPoint Capital, said his firm now arrange millions of dollars worth of hedges through Caowsi, which he has found is often cheaper and more flexible to arrange Major trading firms have been working with Calci in hopes of making that kind of trading even more commonplace Among them is Susquehana International Group the giant trading firm that in twenty twenty four became Kashi's first official market maker and has been evangelizing prediction markets potential ever since It could end up being one of the largest businesses that comes out of prediction markets. Jeremy Mallz, Susquehanas head of macro Trading and Prediction Mets said in an interview In April, Kelsi completed its first block trade, a securities transaction negotiated between two institutions off the public platform Green lightight commommodities brokered the deal involving a contract tied to carbon allowances on behalf of a hedge fund, Jump trading group, a big trading firm, took the other side of the trade. Executives at market makers say hedging on prediction markets would probably fall into several buckets. One that is likely to see high interest is helping companies hedge against political risks It is a more precise way to hedge the exposure of certain outcomes of things like elections, said Josh Barquorter, the head of sales at Falcon X, a prime brokerage for digital markets But perhaps more intriguing is hedging against specific business risks. One trading executive raised the possibility of a companies wanting to hedge its exposure to DRAM memory chip prices or shipping prices Longstanding concern is whether prediction markets have enough liquidity to support such robust trading Kaussci argues that problem is being addressed, with institutional trading volume on its platform having grown eight hundred percent since November, according to Elizabeth Diana, a Kashy spokeswoman Skeptics also pointed to fundamental questions of how prediction markets work. Traditional wagers tend to center on binary outcomes, creating opportunities for disputes about whether a better one Standard prediction market contracts also don't allow for betting on margin Betterors must put up the full amount of their wager. In traditional commodities markets, however, traders can essentially borrow money to control far larger positions but also lose big if things go the other way Last month, Celsci unveiled its first betting product that allows for margin perpetual futures contracts or perPps in industry parlance PERP essentially allow betors to track whether the price of something goes up or down with no expiration date. Kelsciy has also allowed PERPS to be traded on margin while setting up safeguards like restricting them only to deep pocketed traders Since PERPps were unveiled on may twenty ninth, trading in those contracts has reached five and point a fivealf billion dollars in notionational volume, mister Mansur said on Tuesday For now, Kaelshci is offering only perps tied to cryptocurrencies, but the company expects to announce more such contracts tied to a much wider array of assets. The infrastructure that we built for perpetuals will enable a significant expansion of what institutions can hedge on Kowshi Andy Ross, the head of the company's institutional business, said, end quote. Nothing more for you today, talk to you tomorrow