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Yellen says OPEC oil production cuts are bad for the global economy

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US Treasury Secretary Janet Yellen said move by OPEC + to cut oil production It was “unhelpful and unwise” for the global economy, particularly emerging markets already struggling with rising energy prices.

The Biden administration strongly criticized the decision of the oil cartel With the support of Saudi Arabia and Russia this weekThe move was taken in defiance of US pressure to keep global oil prices low.

“I suspect OPECYellen said in a phone interview with the Financial Times that his decision was unhelpful and unwise — it’s uncertain what effect it will end up having, but it certainly isn’t something that seemed right to me, given the circumstances we’re facing. . “We are very concerned about developing countries and the problems they face.”

Yellen was talking before International Monetary Fund and the World Bank’s annual meetings in Washington next week, which will be dominated by discussions of rising inflation and commodity prices, the impact of sharp monetary tightening by many central banks, and the economic and financial impact of the war in Ukraine.

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“I think we’ll exchange views on whether our countries are addressing these problems, and try to look at whether our collective response adds up to something reasonable, the best we can do, in that challenging environment,” she said. .

The United States hopes to use the meetings to pay European countries to provide economic aid to Ukraine More quickly, amid growing frustration in Washington that some of its allies have fallen behind on their pledges to help Kyiv financially.

A number of countries have pledged significant economic aid, but they simply have not paid attention to breaking it up. The pace of money transfers to Ukraine is very slow. “There are commitments but the money has to be distributed,” Yellen said, noting that the United States has provided $8.5 billion in grants to Ukraine and another $4.5 billion that Congress has just approved.

We need to see other countries honor the commitments they have made. It is very important to get this funding for Ukraine as quickly as possible.”

Speaking on Tuesday, Valdis Dombrovskis, Executive Vice President of the European Commission, said the EU is seeking to speed up disbursement of funding for Ukraine, and will work extensively with member states to launch the last 3 billion euros of a 9 billion euro package from leaders. Committed earlier this year.

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However, he said it was also important to have a “more predictable and orderly flow of funding” to Ukraine next year and that the EU would incorporate this into its work on preparing its 2023 budget.

The United States and the G7 allies are entering the final stage of talks to cap the price of Russian oil exports, in order to deprive Moscow of vital energy revenues to finance the war, but also to keep some oil flowing out of the country in a way that does so. Do not lead to a jump in prices around the world.

“Reducing prices is particularly beneficial for developing countries that are experiencing high energy prices,” Yellen said.

But the Treasury secretary will not be drawn to the countermeasures the United States might deploy in response to OPEC’s move, after White House officials said they would begin consultations with Congress over possible reactions.

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“The president has for a long time focused on exploring all the options available to try to bring her in. [oil prices] down,” she added.

Yellen will likely face some concern from her peers around the world about the value of the dollar, which has risen strongly against many other currencies in recent months as the Federal Reserve has raised interest rates dramatically. But she said the dollar’s rise was driven by economic reality.

We’ve seen a significant appreciation of the dollar, but I think it’s mainly driven by differences in macro fundamentals, across countries. In the case of the US, she said, it is safe haven flows in response to geopolitical tensions and of course various steps of monetary tightening.

Yellen also dismissed concerns about some market turmoil in recent weeks.

We monitor currency movements and their effects closely. We continue to believe that the markets are doing well and are generally appropriate given the fundamental differences across countries, policies and economic conditions,” she said.

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Yellen declined to comment on Britain’s sweeping tax cuts, which sent shockwaves through financial markets before the Bank of England was forced to intervene in an emergency and Prime Minister Liz Truss backed away from some of the plan.

Additional reporting by Sam Fleming in Brussels

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US Equity Funds Record Largest Weekly Outflow In About 1-1/2 Years By Reuters

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© Reuters. FILE PHOTO: One hundred US dollar banknotes are seen in this illustration taken in Seoul on February 7, 2011. REUTERS/Lee Jae-won/File Photo

(Reuters) – US equity funds posted massive outflows in the week ending Dec. 7 as investors worried about the Federal Reserve’s interest rate hike, as data showed a rebound in employment and a recovery in the services sector.

According to data from Refinitiv Lipper, US equity funds recorded withdrawals of $26.66 billion, the largest weekly outflow since April 2021.

Graph: Money Flows: US Stocks, Bonds, Money Market Funds, https://fingfx.thomsonreuters.com/gfx/mkt/znpnbbezgpl/Fund%20flows%20US%20equities%20bonds%20and%20money%20market%20funds.jpg Reports Show Upbeat US service industry activity and higher-than-expected additions to non-farm payrolls in November raised bets that the Federal Reserve will remain more hawkish than expected.

Investors were also worried because the largest U.S. banks including Goldman Sachs (NYSE: ), JP Morgan, and Bank of America (NYSE: 100) have warned of a recession as inflation threatens consumer demand.

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US equity growth funds saw $9.91 billion in withdrawals, while value funds saw a net sell-off of $2.03 billion, as selling continued for the third straight week in every sector.

Graph: Fund Flows: US Growth and Value Funds, https://fingfx.thomsonreuters.com/gfx/mkt/jnvwyyewnvw/Fund%20flows%20US%20growth%20and%20value%20funds.jpg Sector fund data showed technology, financials and fund losses Estimated consumers are $1.27 billion, $761 million, and $527 million, respectively, in outflows.

Graph: Fund Flows: US Equity Sector Funds, https://fingfx.thomsonreuters.com/gfx/mkt/gdvzqqywlpw/Fund%20flows%20US%20equity%20sector%20funds.jpg Meanwhile, US bond funds received a net 992 million dollars in inflows after seeing weekly outflows for four weeks.

Taxable US bond funds made net purchases of $886 million after three consecutive weeks of selling, although municipal bond funds experienced small outflows of $53 million.

US investors bought $318 million in high-yield bond funds and $1.06 billion in government bond funds in their biggest weekly net purchases since November 16. However, domestic public taxable fixed income funds recorded $794 million worth of outflows.

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Graph: Fund Flows: US Bond Funds, https://fingfx.thomsonreuters.com/gfx/mkt/zgpobbmrovd/Fund%20flows%20US%20bond%20funds.jpg Meanwhile, US money market funds took in $36.19 billion of inflows, the largest amount for a week since November 2.

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FirstFT: The FTC is flexing its muscles on the Microsoft-Activision deal

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good morning. This article is an in situ version of our website FirstFT the news. Subscribe to our site AsiaAnd the Europe/Africa or The Americas A release to send straight to your inbox every weekday morning

The US Federal Trade Commission will file a lawsuit to block Microsoft $75 billion acquisition of video game maker Activision Blizzard Because of concerns that the deal could hurt competitors to the Xbox consoles and cloud gaming business.

Deal, which was announced in JanuaryIt will be Microsoft’s largest acquisition ever and will make it the third largest game company by revenue, after China’s Tencent and Japan’s Sony.

But the Federal Trade Commission said yesterday that the deal would harm competition in the gaming sector, highlighting the fact that Activision is one of the few video game developers that produces and publishes the best video games for many devices such as PCs, consoles and mobile phones.

Microsoft moved to head off a regulatory backlash this week By signing a contract for 10 years To bring Call of dutythe blockbuster that brought in $30 billion in lifetime sales for Activision, has moved to Nintendo platforms instead of turning it into an Xbox exclusive.

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The measure is one of the biggest tests yet for Lena Khan, the chair of the Federal Trade Commission appointed by President Joe Biden, who has He vowed to crack down on Big Tech’s market power.

Microsoft CEO Satya Nadella hoped the deal would give the US software company a head start in the race to build the next version of the Internet and saw no reason for competition concerns when He spoke to the Financial Times in February.

“Even after this acquisition, we’ll be in third place with kind of a lower teen share[of the video games market]. . . “We’re going to be a bit of a player in a place that’s going to be very fragmented,” he said.

1. Pro-left appointed as Brazilian Finance Minister Luis Inacio Lula da Silva Fernando is expected to name HaddadThree well-informed sources reported that a loyalist from the left-wing Labor Party as Finance Minister today. The decision is likely to disappoint financial markets and reignite investor fears that the Lula administration, which takes office on January 1, will pursue a looser fiscal policy.

2. The US House of Representatives passes a defense bill worth $858 billion in financing weapons for Taiwan passed by the US House of Representatives A comprehensive defense spending bill of $858 billion That provides $10 billion in funding to provide arms to Taiwan as the country comes under increasing pressure from China. It is the first time that the US government has funded weapons for Taiwan.

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3. The United Kingdom, Japan and Italy agree to jointly build advanced combat aircraft The three countries will joint construction One of the most advanced combat aircraft in the world by 2035, to expand its defense capabilities to counter the growing threats from China and Russia. They will share development costs estimated at tens of billions of dollars.

A mock-up of the Tempest jet at the 2018 Farnborough Airshow
The UK and Italy’s Tempest fighter program will be integrated with Japan’s FX project © Peter Nicholls / Reuters

4. Airlines are feeling the pressure as charter groups raise rents Airlines return to profitability, but one cloud looms: Sharp increases in rental costs. More than half of the world’s commercial aircraft are owned or operated by leasing companies, and their fees are rising, which is another consequence of rising interest rates.

5. The Faustian agreement between Joe Biden and Russia to secure the release of Brittney Greener Brittney Griner’s release was greeted with joy from the basketball star’s family and supporters. But the exchange with Viktor Bout, a notorious arms dealer, drew criticism and raised questions about how America’s adversaries would deal with them. It may benefit from the arrest of its own citizens in the future.

How good is it to keep up with the news this week? Take our test.

Coming days

Economic data The US Department of Labor will update the Producer Price Index. The producer price index is expected to have risen 0.2 percent in November from the previous month, but the annual pace of wholesale inflation is expected to have eased to 7.2 percent, from 8 percent in October. The University of Michigan preliminary reading on consumer confidence is expected to have risen to 56.9 in December from 56.8 last month.

UK to launch financial services reforms Chancellor Jeremy Hunt would Unveil changeswhich include raising the ceiling on bankers’ bonuses and removing the requirement to separate risky investment banks from retail operations, in a speech in Edinburgh later in the day.

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Putin in Kyrgyzstan Russian President Vladimir Putin has arrived in Bishkek, the capital of Kyrgyzstan, to participate in the Eurasian Economic Union summit. The leaders are expected to discuss the establishment of a joint gas market and the establishment of an intergovernmental council in the field of energy. According to the Russian news agency TASS.

world Cup The quarter-final matches kick off in Qatar today, with Croatia playing Brazil in the first match, followed by the Netherlands and Argentina. Tomorrow, the surprising Moroccan team will meet Portugal at the start of the match, and England will meet France at a later time.

  • Read more: Simon Cooper, who grew up in the Netherlands, explains how the Dutch do it They abandon tradition under their coach Louis van Gaal in a bid to win the World Cup.

What else do we read?

Light needs to illuminate the black hole on dollar swaps An ordinary person might assume the dollar swap market It is a transparent angle of financing, given that the US currency underpins much of the global industry and these contracts are used by most of the major corporations and investment groups. Not so, writes Gillian Tate, as a recent report from the Bank for International Settlements shows.

Has inflation peaked? Central banks in the developed world have cautiously raised interest rates to curb demand and crush inflation this year, but, says the Financial Times editorial board, Now is not the time to hold back or cut back borrowing costs.

‘Hell. Hell: The War of Attrition on Bakhmut With Russia desperate for victory, wave after wave of infantry began Thrown in the city of Bakhmut on the front line In the Donetsk province, only to be cut down by the Ukrainian defenders. “They are just meat for Putin, and Bakhmut is a meat grinder,” said Kostyantyn, an exhausted Ukrainian machine gunner.

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Maps show that there was relatively little movement on the front line around Bakhmut

Why the price of oil has fallen despite new restrictions on Russian supply This week saw a pivotal moment in global geopolitics, as the European embargo and G7 cap on Russian crude oil prices came into effect. Within hours, supply disruptions set in as the piling up oil tankers queued up in the Bosphorus Strait. All of this would normally lead to a sharp rise in oil prices. However, yesterday they reached a new low of 2022. What is going on? Our energy editors explain.

It’s time to hunt down the dragons of the Asia Corporation I learned the hard way during years of managing Japanese equity portfolios, writes the Financial Times’ new investment columnist Stuart Kirk, the country’s corporate bosses were obsessed with market share, quality, innovation, culture and hard work. But did they sleep at night dreaming of my equity returns, Stewart asks, no they did not. That’s changing, he says, but local conditions are still very important.

the television

There are explosive royal TV shows out there, writes lead writer Henry Mance. But so far the new Netflix series Harry and Megan Not them. He argues that the Sussexes are both an ambitious couple and a cautionary tale about ambition.

The Duke and Duchess of Sussex
Harry & Meghan is produced by the couple’s company Archewell © Courtesy Prince Harry and Meghan, the Duke and Duchess of Sussex

Thank you for reading and remember that you can Add FirstFT to myFT. You can also choose to receive a FirstFT push notification every morning on the app. Send your recommendations and feedback to firstft@ft.com

Climate chart: an explanation – Learn about the most important weather data for the week. Participation over here

Long story short – The biggest and best-read stories in one smart email. Participation over here


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What is the ChatGPT policy?

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Rob Lonnie She claims to be a “left-liberal”. David Rosado I applied the political compass test He concluded that ChatGPT is a mixture of left and liberal leanings, eg: “anti-death penalty, pro-abortion, skeptical of free markets, corporations exploiting developing countries, more taxes for the rich, government subsidies, pro-benefits for those who refuse to work, Pro-immigration, sexual liberation, morality without religion, etc.”

Produce this image from the test results:

Rosado also ran several other political tests with largely similar results. However, I would like to stress a few different points. Most of all, I see ChatGPT as “pro-Western” in its perspective, while giving different visions of what this means. I also see ChatGPT as a “discord minimization”, for business reasons but also simply to want to get on with substantive work with a minimum of external fuss. I wouldn’t have built it myself So differently, and note that the bias may lie in the training data rather than any biases of the creators.

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Marc Andreessen has received a number of tweets suggesting that AI engines will host the “mother of battles” over content, censorship, bias, etc. – outside of the current battles on social media.

I agree.

I saw someone ask ChatGPT if Israel is an apartheid state (I can’t reproduce the answer because chat is now broken for me – unfortunately! But try for yourself.). Basically, ChatGPT answered no, that only South Africa was an apartheid country. Not many people will be unhappy with this answer, including many supporters of Israel (Israel’s moral defense, on the one hand, was not weighty enough for many tastes). Many Palestinians will object, for obvious reasons. And what about all those Rhodesians who suffered under their apartheid regime? Are they simply to be forgotten?

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When it comes to politics, the AI ​​engine simply cannot win, or even win a draw. However, there is no simple way to keep them out of politics either. By the way, if you get frustrated with ChatGPT wrapping your question, rephrase it in terms of asking them to write a dialogue or speech on a topic, in someone else’s voice or style. Often it will go further in this way.

The world has yet to realize how powerful ChatGPT is, and thus Open AI can still live in a kind of relative peace. I’m sorry to say that it won’t last long.

the post What is the ChatGPT policy? Debuted marginal revolution.

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