Good Morning, The headlines are again centered around the things that make for great stories. In this case, it’s the AI’s impact on software companies and on private credit. That’s a clean story… one that we can definitely resonate with in this period. I’ll be very honest. I’ve spent the last week looking at the new Claude launch and felt this discomfort for the very first time. It’s not just about the ability to turn around a 1,500-word, grad-level first draft that is clean and well-cited. It’s just the obvious impact on the future of market insights and analysis. This is going to be a very odd world. Claude’s impact yesterday came in the legal sector. I’m an investor in an AI legal companion company, and Anthropic’s move into this space is jarring. It’s just a matter of time before it really has its own news desk, and who knows what else. Whether people trust it is another animal. But we’ll find out, because the collision course is set… All that said… we saw real bleeding in the private equity space yesterday. And while AI, software, and private credit saw the headlines… what didn’t we see? Japan. The Bank of Japan is providing another 700 billion yen in Yield Curve Control efforts and more direct lending, according to Just Dario’s analysis of its operations. The yen is weakening against the dollar again. The concern right now from Ray Dalio is that we’re on the brink of a Currency War. Hate to tell him, but we’ve been in one for about a decade (the subject of my Postcards article later today)
Whatever was said two weeks ago about currency intervention has already burned off completely. Japan holds a snap election on Saturday, and Prime Minister Takaichi is back talking weaker yen. Dizzy yet? ... Continue reading this post for free in the Substack app
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