Market On Open, Friday 27 February
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AI-r Cover
by Alex King, CEO, Cestrian Capital Research, Inc.
Today, Block ( $XYZ ), the artist formerly known as Square, will lay off some 40% of its workforce. The stated reason is “because AI” and I have no doubt this is in part true. You can automate a lot of stuff these days and like it or not that is going to mean a slew of job losses. We can argue about whether this new technology, like those before it, will create plenty of new jobs that we cannot right now imagine (who knew that messing about on the Internet with a cameraphone would become a way to print the good money?)
Of course the other reasons to lay off so many folks are (1) because you can - I think that literally every company can shed 1/3 of its staff without anything bad happening to the company (2) because the thing was overstaffed in the first place, Dorsey not being known for keeping it tight on the headcount front, as Twitter pre Musk evidences (3) no-one is too sure how strong the economy is and if payments is your thing, why not take some cost out now just in case life gets tougher and also and in fact mainly, (4), because it is a great way to make yourself a lot richer if you are in the shareholder class not the labor class. Here’s what the market thought of the wrecking-balls lobbed late last night:
This is the start of a wave of big layoffs. Some of which is AI for real, and some of which is “because the stock price”. Depending on your take on capitalism, humanity and blah, you can like this or not like it, that’s for you and your conscience. But as regards making money from stonks, this being our thing here? Fewer heads = more profits = good. Simples.
Crypto
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You can learn more here.
Alex King
Now let’s get into it.