Hey Snackers,
The new year’s here, and so’s the future: 2023 is only three days old, but we’re looking ahead to trends that could shape the next decade and beyond, from AI art to psychedelic medicine.
US stocks had their worst year since 2008. The S&P 500 lost nearly 20% and the tech-heavy Nasdaq sank 34% as the Fed hiked interest rates seven times — including four “jumbo” hikes of 75 basis points.
As inflation cools and the economy softens, the US’s central bank is expected to slow hikes and (eventually) pause them this year. But it could be a while before it starts cutting rates. On the economic side, the sluggishness we’ve started to see could continue through the new year.
The future is now…
AI gets (scary) creative… Generative AI, which can convert text prompts into images and articles, made a splash last year. OpenAI released its futuristic chatbot, ChatGPT, to the public last month, shortly after launching its image generator, DALL-E. The impressive tools caused shock and awe — and raised fears they could replace creative professions like copywriting and design (Jasper, a genAI tool used for marketing copy, hit a $1.5B valuation). Some teachers are convinced genAI will kill homework too. While unknowns abound, investment is booming as companies seek innovative ways to automate work.
Crypto rediscovers its roots… The collapse of centralized crypto players like FTX and Celsius breathed life back into crypto's core conceit: decentralization. Decentralized exchanges (think: not run by a biz) like Uniswap saw activity spike — briefly surpassing centralized Coinbase in ether trading — as people sought greater control of their crypto. Makers of self-custody hardware wallets (picture: no exchange needed) reported soaring sales, while decentralized-finance transaction volumes jumped 68% from October to November. The decentralized momentum could get a boost as bipartisan lawmakers push tighter crypto regs.
Around the corner…
- Transpo goes auto… Transportation goes autonomous — of packages and people. First, drone deliveries could go mainstream. Last month Amazon began dropping parcels with its Prime Air service. Walmart’s expanding its DroneUp network while Google’s Wing teamed up with Walgreens for Dallas deliveries. Below the skies, autonomous freight trucks are expected to hit roads by next year. On the passenger side, Cruise and Waymo are boosting driverless rides in cities, while Uber and Lyft partnered with Motional to start robotaxi ride-hails next year. “Auto transpo” could ease driver shortages and backlogs.
- A psychedelic renaissance... Psychedelic-drug startups (think: shrooms, LSD) have seen record investing in recent years as more health experts explore the benefits of hallucinogens. Last year, Johns Hopkins said one of its psychedelic treatments eased depression symptoms, and other experts say trippy treatments could help with anxiety and PTSD. While still illegal federally, psychedelics are decriminalized in several US cities and are approved for recreational use in Oregon and Colorado. Now the psychedelic-substances biz is predicted to grow 5X to $10B+ by 2027 — which would outpace the legal-pot industry.
Down the road…
- The nuclear revolution… The future of clean energy could be nuclear. Last month scientists made a huge breakthrough after successfully using a nuclear-fusion reaction to generate 50% more energy than what was required for its creation — aka "net energy gain.” Nuclear fusion releases 4M times more energy than burning oil, coal, or gas and can unlock "virtually limitless" carbon-free power. While commercial use for fusion tech (think: electricity, heating homes) is still decades away, the overall market could be worth $40T down the road. It could be a green solution to prevent energy crises.
- Central bank digital currencies take off… Last year the Treasury Department kicked the CBDC can down the road, saying it would reevaluate the need for a government-backed digital dollar (possibly powered by crypto) in 5+ years. When it does, it may need to play catch-up. China began its CBDC test in 2020, India started testing one last year, and the European Central Bank says it's looking into CBDCs. Meanwhile, the Fed is set to launch a real-time interbank payments system this year, which suggests a digital payments overhaul of some kind is already in the works.
What else we’re Snackin’
- Brainy: From Musk to Bezos, billionaires are investing in brain-implant startups that could one day connect computers to our brains (think: surfing the web with your mind). The tech could help people with disabilities communicate through thoughts.
- Meta: As the hype wears off, the metaverse faces a rocky reality: global shipments of VR headsets plunged 13% last year to fewer than 10M units, an uninspiring sign for Meta and Apple, which is rumored to be launching AR glasses this year.
- Tour: Prepandemic, China was the largest source of outbound tourists, and its strict zero-Covid policy had global ripple effects. On January 8, the world’s second-largest economy plans on reopening its borders after three years of isolation.
This Week
- Monday: US stock market closed for New Year’s Day (observed)
- Tuesday: Earnings expected from Smart Global
- Wednesday: Federal Open Market Committee minutes expected
- Thursday: Jobless claims. Earnings expected from Walgreens, Conagra, Constellation Brands, and Lamb Weston
- Friday: Earnings expected from Greenbrier
Authors of this Snacks own: Uniswap and shares of Apple, Amazon, Google, Uber, and Walmart
ID: 2658879