Morning Download from Invincible Money

Personal finance + economics + markets

Finance in 5 minutes a day to help you make better money decisions.

Good morning investors! As the debt ceiling negotiations drag on, the credit agencies all say they’ll downgrade the U.S. if the Democrats and Republicans can’t get along. Meanwhile, AI continues to get infused into everything, everywhere, all at once.

📊 Economy 

Debt Ceiling Standoff

💯 The ratings agencies have all warned that a default on U.S. debt would have a devastating impact on the U.S. economy and could permanently damage the nation's credit rating.

• Moody's: Moody's has said that a default would "not be consistent with the highest rating possible" and that the U.S. would likely be downgraded by one notch.

• S&P Global: S&P Global has said that a default would "be a severe event" and that it would likely downgrade the U.S. by one notch.

• Fitch Ratings: Fitch Ratings has said that a default would "be a negative credit event" and that it would likely downgrade the U.S. by one notch.

The ratings agencies have also said that a default would make it more difficult for the U.S. government to borrow money in the future. This would make it more expensive for the government to finance its operations and could lead to higher interest rates for businesses and consumers.

In addition to the economic impact, a default on U.S. debt would also have a significant political impact. It would damage the credibility of the U.S. government and could lead to a loss of confidence in the U.S. dollar. This could have a ripple effect throughout the global economy. (I made a video about the threats to the dollar here.)

** The main sticking point is that Republicans want to cut spending, while Democrats are willing to freeze spending.

📰 News

🚙 Tesla and FTX had their reputations drop by the most last year, while Patagonia has the best reputation among 100 companies, followed by Costco, Chick-fil-A, and UPS as the most trusted. (Go here for the complete list)

🚶🏿‍♂Breakthrough! A man who was paralyzed from the waist down after a car accident has been able to walk again using a brain-computer interface and spinal implant.

• The implant, developed by researchers at Brown University, allows the man to control a robotic exoskeleton that helps him walk.

• The man has been able to walk for short distances without any assistance, and the researchers believe the technology could eventually be used to help other paralyzed people walk again.

✅ Microsoft announced new AI products and services, including Azure Bot Service, Azure Cognitive Search, Azure Machine Learning, and Power BI. These offerings make AI more accessible to businesses and developers. Microsoft is also making its AI technology available through Azure AI SDKs.

TLDR: They’re putting AI in everything, just like Google did last week!

Also, not to be outdone, Adobe has added Firefly, its generative AI image service, to Photoshop. Users can now alter images using text-based commands, adding or removing objects as needed. Adobe says it sees AI as a "co-pilot" for human designers.

📈 Stocks

🎤 Spotify [SPOT -0.23%] is researching ways to use AI voices to create targeted ads. For example, the AI would recreate the hosts’ voices and create ads specific to geography to promote an event happening in a certain city.

Note: I’m considering using AI to record this newsletter into a daily podcast episode using my own voice for those who love podcasts. If you think that’s a good idea, reply to this email and share your thoughts. I’ve tested it out already and it’s pretty amazing!

🥸 Meta [META +0.46%] loses out with Giphy!

Facebook acquired Giphy for $315 million in 2020, but is selling it to Shutterstock for $53 million. Reasons for the loss include declining popularity, to focus on core business, and antitrust regulators in the UK ordered Meta to get rid of it.

• Giphy has 1.7 BILLION users!

• Meta also started a round of layoffs, starting with business groups.

🔐 Crypto

🥶 Blizzard Entertainment is using artificial intelligence to create art and design for its video games.

• The company's internal tool, Blizzard Diffusion, is a riff on Stable Diffusion, one of the popular image generators that enables anyone to turn text into art.

• Blizzard Diffusion is being used to help generate concept art for game environments as well as characters and their outfits.

🌞 The Solana Foundation released a ChatGPT plugin that integrates AI with the Layer 1 blockchain.

• The plugin allows developers to build conversational AI applications on Solana.

• The Solana Foundation also launched an AI accelerator to support the development of AI applications on the blockchain.

🧮 Ledger has paused the launch of its key recovery tool, Ledger Recover, after facing backlash from the community.

• The company has also announced that it will open-source the code for Ledger Recover.

• Ledger says that this is in an effort to increase transparency and build trust with its users.

💵 Personal Finance

Paying down the debt

One of the best ways to pay down debt is to pay off your credit cards.

• Whatever the interest rate is, that’s your return. So if you pay 19% APR and pay it off, you got a 19% ROI, which is pretty tough to get these days.

• Paying your credit card down below 30% utilization helps your FICO credit score. For example, if your limit is $1,000, always keep the balance under $300.

💰 Be a Better Investor

I like this quote because we often feel we’ve missed the boat, so what’s the use of starting something new now?

“I’m so far behind, why start investing?”

“It’s too late to start a YouTube channel. The best time was 10 years ago.”

“I should have bought Bitcoin in 2013 when my friends did.”

This is a reminder that it’s always better to start something now, even if it is late. If you wait too long, you may miss out on the opportunity altogether.

This proverb can be applied to many different areas of life, such as investing, education, and relationships. For example, if you want to invest for retirement, it is better to start saving now, even if you are not able to save a lot. The sooner you start saving, the more time your money has to grow.

The same is true for education. If you want to get a degree, it is better to start working towards it now, even if you are not sure what you want to study. The sooner you start, the more time you have to explore different options and find the right program for you.

Time will pass either way. You may as well use the time to work toward your goals.

👩🏽‍⚖️ Legal Stuff
Nothing in this newsletter is financial advice. Always do your own research and think for yourself.