All those calls for Black Monday over the weekend, only for equities to open the week higher. Demand for downside protection is rising, but investors aren’t abandoning equities just yet. alphapicks.co.uk/p/disturbin…

One thing I’ve been thinking about since reading this is the Outsider Advantage. Expertise isn’t the entry requirement for solving complex problems. AI likely opens this up even more. One illustration of this came from the oil industry, which had spent years struggling with a problem involving the extraction of thick, viscous oil from storage barges. The eventual solution came from someone with no particular expertise in oil recovery. A chemist recalled how vibrations were used to help concrete flow during construction and realised the same principle could work with oil. Eli Lilly also solved a problem with a similar approach, and thus idea became the foundation of InnoCentive, a platform where companies could post problems that had stumped their experts and invite outsiders to solve them. Many successful solutions came from people working in entirely different disciplines. Expertise can sometimes narrow the way we approach a problem. Outsiders bring different mental models, experiences, and analogies that specialists might never consider. This is all very well explained in David Epstein’s book “Range”, where I first read about it. Bring this back to Anthropic and Citrini’s experiment, AI could fundamentally change the InnoCentive model. Previously, outsiders needed to possess some transferable knowledge that happened to be useful. They could contribute an unexpected idea, but turning that idea into a technically viable solution often still required substantial specialist expertise. AI lowers that barrier, giving outsiders access to technical knowledge, scientific literature, and tools that previously required years of training to use effectively. I think it has become an interesting possibility that more of the breakouts in the next decade will come from people who were never formally trained in the fields they’re advancing, once again because they see something the experts don’t. The Outsider Advantage.

Sunday reading.

The sooner we get Monday’s liquidation headlines out of the way, the sooner markets can find a bottom. (Thanks to Ken in advance)

One thing I’ve appreciated from using ASKB over the past few months is how much AI utility depends on the quality of the underlying data. A model built on a data ecosystem such as Bloomberg’s has an advantage over one retrieving information from sources of varying reliability. Worth integrating into workflows where possible.

Equities are red and Bloomberg has just collected its quarterly blood sacrifice. Tough day.

The script says Spoos hits 8k before it’s over over.

Nothing says flight to safety quite like buying the FTSE 100.

The interesting macro stories aren’t limited to Europe and the US. Brazilian assets have repriced sharply after Bolsonaro’s first-round win. With a presidency increasingly priced in, the next leg of the Brazil trade hinges on one thing: Delivery. alphapicks.co.uk/p/buying-th…

Correction: every inflation print is always the most important of our lives… On a more serious note, agreed on the path into y/e. Hold in October and hike in December.

Happy inflation day to all who celebrate.

Maybe the real pain trade is hyperscalers and Mag 7 continuing to grind higher while everything else bleeds.

The BoJ’s balancing act isn’t getting any easier. October hike expectations are fading, December is coming into focus, and the yen outlook remains murky. Our latest revisits the dilemma we flagged in September and the catalysts ahead. ap-fx.co.uk/p/no-rush-in-tok…