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The World
Several U.S. officials pushed back on Kremlin spokesperson Dmitry Peskov’s accusation that Washington coordinated drone attacks on Moscow with Ukraine, emphasizing that the United States had no involvement in the Wednesday morning attack. “I can assure you that there was no involvement by the United States. Whatever it was, it didn’t involve us,” National Security Council spokesperson John Kirby said on MSNBC when asked about Peskov’s comments. “We had nothing to do with it. Peskov is just lying there, pure and simple.” On CNN soon after, he called it a “ludicrous claim.” (Politico)
Three expert theories on who launched drones over the Kremlin. James Nixey, director of the Russia and Eurasia Program at Chatham House thinks there are two likely possibilities for what happened on Wednesday: That Kyiv fired a warning shot at Moscow to prove its capability, or Moscow carried out a false flag attack against itself. Valentin Châtelet, Research Associate at the Atlantic Council’s Digital Forensic Research Lab, said that articles on Russian state media emerged “within minutes” of the announcement of the drone strike, which raises questions on whether the attack was a false-flag operation on behalf of the Kremlin. Alexander Downes, Associate Professor of Political Science and International Affairs, The George Washington University, said that killing Putin would take “an enormous stroke of luck…so the Russian argument that this was an ‘assassination’ attempt is not very convincing.” (Semafor)
A new law that allows Russia to seize foreign-owned energy assets should be a final warning to Western firms to cut their losses and leave the market for good, one of the country’s most prominent exiled businessmen has cautioned. “There are no guarantees for the safety of investments anywhere, but Vladimir Putin’s regime has demonstratively built an illegitimate and lawless state,” former oil and gas magnate Mikhail Khodorkovsky told POLITICO. (Politico)
Taiwan trade chief warns against ‘unnecessary fear’ of China. Taiwan’s chief trade representative says his country’s semiconductor makers will expand production in the U.S. as much as they can afford to do so, but he insists Taiwan remains an ideal place for that production and other U.S. trade, business and investment, despite tensions with China. John Chen-Chung Deng spoke to The Associated Press on a visit this week to Washington, where he is leading a Taiwanese trade delegation and meeting with U.S. trade officials. Deng’s visit comes at a time of intensifying efforts to harden the U.S. and Taiwanese militaries and economies against any threat from rival China. As part of this, President Joe Biden and Congress are moving to boost semiconductor production on U.S. soil in the event of any conflict disrupting exports from Asia, especially from Taiwan. (Associated Press)
Japan is moving to deepen its ties with Nato, with the most powerful military alliance in the world due to open a liaison office in Tokyo next year. The new office will be Nato’s first in Asia, and will facilitate consultations between the 31-nation alliance and Japan amid growing challenges to peace and security in the region, the Nikkei Asia reported. The single-person outstation will also be linked to other like-minded nations in the Asia-Pacific, including Australia, New Zealand and South Korea. The suggestion for a liaison office in Tokyo was first put forward in late January, when Nato Secretary General Jens Stoltenberg visited Japan for talks with Prime Minister Fumio Kishida. (South China Morning Post)
Senate Democrats charged that House Republicans’ debt limit demands would tip the US into a recession through a forced choice of either sharp spending cuts or a federal default. Democrats made the case in a hastily assembled Senate Budget Committee hearing as both parties struggled to win over public opinion ahead of a meeting on the debt limit next week between President Joe Biden, Republican House Speaker Kevin McCarthy and other congressional leaders. (Bloomberg)
Records toppling as temperatures hit nearly 90 degrees in northern Canada: Parts of the northwestern United States are also seeing unprecedented temperatures as the jet stream makes some dramatic curves. (Washington Post)
Economy
One of the most successful people in the history of capitalism recently did something out of character: He proposed a theory for his own success. Warren Buffett’s annual letter to the shareholders of Berkshire Hathaway is a chance for him to reflect on the past year. This year, he also ruminated on the past 58 years, and he managed to summarize his career in two numbers. The first was Berkshire’s returns over that period: 3,787,464%. The second number was smaller and less precise but no less astonishing. “Our satisfactory results have been the products of about a dozen truly good decisions,” wrote Mr. Buffett, who is 92. “That would be about one every five years.” (Wall Street Journal)
Warren Buffett Has Been Betting Big on Oil. It’s Time to Find Out Why. One of the most successful stock pickers of all time admitted years ago that he was “dead wrong” on an earlier oil-company investment. What’s changed? (Wall Street Journal)
The attorneys general of California and New York are investigating the National Football League for employment discrimination and a hostile work environment, their offices said, adding to the mounting scrutiny of the workplace behavior in America’s most popular sport. The attorneys general said they issued subpoenas to the league seeking relevant information and that the joint investigation will probe allegations made by former employees, including potential violations of federal and state equity and antidiscrimination laws. (Wall Street Journal)
The US is poised to exempt smaller lenders from kicking in extra money to replenish the government’s bedrock deposit insurance fund, and instead saddle the biggest banks with much of the bill. The Federal Deposit Insurance Corp. is planning to release as soon as next week a highly anticipated proposal for refilling its Deposit Insurance Fund, which was partly depleted by the failures of Silicon Valley Bank and Signature Bank, according to people familiar with the matter. (Bloomberg)
U.S. federal and state officials are assessing the possibility of "market manipulation" behind big moves in banking share prices in recent days, as the White House vowed to monitor "short-selling pressures on healthy banks." Shares of regional banks resumed their slide this week after the collapse of First Republic Bank, the third U.S. mid-sized lender to fail in two months. Short sellers raked in $378.9 million in paper profits on Thursday alone from betting against certain regional banks, according to analytics firm Ortex. (Reuters)
US banks under fresh pressure as Nelson Peltz calls for Washington to stem crisis: Activist investor makes case for an increase on the $250,000 deposit insurance limit. (Financial Times)
Technology
The White House announced a number of actions around artificial intelligence ahead of a meeting with top tech CEOs. Why it matters: Technology usually develops faster than government action can keep up, and the rapid rise of generative AI systems has raised alarm bells for governments around the world. Driving the news: The administration is taking the following AI-related actions, per officials:
$140 million in funding will be granted to seven new National AI Research Institutes, bringing the total across the country to 25.
An "independent exercise" at a major hacker event in August — with participation by Anthropic, Google, Hugging Face, Microsoft, NVIDIA, OpenAI and Stability — will provide public assessments of how well existing generative AI systems meet the Biden administration's AI Bill of Rights blueprint.
This summer the Office of Management and Budget will release a draft policy guidance on the use of AI systems by the federal government, open to public comment. (Axios)
OpenAI’s losses roughly doubled to around $540 million last year as it developed ChatGPT and hired key employees from Google, according to three people with knowledge of the startup’s financials. The previously unreported figure reflects the steep costs of training its machine-learning models during the period before it started selling access to the chatbot. Even as revenue has picked up—reaching an annual pace of hundreds of millions of dollars just weeks after OpenAI launched a paid version of the chatbot in February—those costs are likely to keep rising as more customers use its artificial intelligence technology and the company trains future versions of the software. Reflecting that capital drain, CEO Sam Altman has privately suggested OpenAI may try to raise as much as $100 billion in the coming years to achieve its aim of developing artificial general intelligence that is advanced enough to improve its own capabilities, his associates said. (The Information)
Nearly Half of YouTube’s U.S. Viewership Is Now on TVs, Helping Drive Ad Shift. For years, Google’s YouTube couldn’t get any respect from the TV industry. TV marketers wouldn’t go near it out of fear that their ads would be tainted by running alongside YouTube’s amateur content. And analysts and research firms treated the streaming service as separate from the rest of television when analyzing TV viewing and advertising. How things have changed. One startling statistic shows how YouTube is now unequivocally the king of TV. Its internal data indicate that close to 45% of overall YouTube viewing in the U.S. today is happening on TV screens, according to people familiar with the matter, compared with well below 30% in 2020. That’s a radical shift for the video-streaming service, reflecting how the growth of internet-connected TVs has made it easier for people to watch streaming services like YouTube on TVs instead of on their cellphones and computers. (The Information)
Apple’s iPhone shipments bounced back from supply chain disruptions in the holiday period, though revenue still declined year on year for the second quarter in a row due to what it described as a “tougher” economic environment and currency headwinds. Finance chief Luca Maestri said Apple had seen “significant acceleration in iPhone revenue from December to March”. Sales of the device, which accounted for 54 per cent of total revenue, rose 2 per cent in the quarter to $51.3bn, ahead of estimates at $48.9bn. The uptick in sales came as a relief to investors questioning what demand would look like following an outbreak of Covid-19 at the Foxconn factory known as “iPhone City” that had derailed production in November. (Financial Times)
Smart Links
Google announces the Pixel Fold. (The Verge)
US allows more inbound flights from Chinese airlines. (Semafor)
Shopify cuts 20% of its workforce; shares surge on earnings beat. (CNBC)
TurboTax Paying $141 Million to Taxpayers Who Could Have Filed for Free. (WSJ)