Biden signs sweeping executive order on AI regulation

Welcome to the Level Ups. Modern business news in plain-Jane English.

Today, we cover:

• Biden signs sweeping AI regulations.

• Toyota sees massive increase in profits

• U.S stocks rally as interest rates hold

• Canadian Corner: nation posts slowing immigration targets

Let’s get into it.

Estimated reading time.

TOP STORY

Biden signs sweeping AI regulations

The White House released the latest changes, marking the “strongest global action yet” on AI safety.

The release is extensive so here’s a quick summary:

• Companies must use standard tests and tools (to be developed later), to ensure AI is safe, secure, and trustworthy.

• The results and “critical information” must be shared with the U.S. government.

• AI-generated content will be watermarked to clearly show it’s AI. The intention is to prevent deepfakes.

• Protections specifically around privacy and identity, so the AI cloning your sister’s voice can’t trick you into giving them codes.

• A mandate to lead AI governance across the globe.

• These safety measures include using AI for chemical, biological, radiological, and nuclear purposes. Whether for developing potential viruses, weapons, or something else.

• Ensuring fairness when using AI in their criminal justice system.

Considering there’s a “deepfake maker” and scammers are using AI voice clones to impersonate loved ones and trick people (don’t do that), it’s about time.

But don’t laugh (or cry) too soon. It’ll take time for these changes to take effect. Be careful. Now that scammers know it’s coming, they’ll go harder before they face potential regulations.

It’s not so simple

This is not even guaranteed to go through, and key details are missing.

• Executive Orders are not as stable as legislation because future administrations can reverse them.

• Much of this is up in the air, so we don’t know what the test standards will actually be.

• The data is not mandated for public release. It’s just for the government.

• There are no details on how this applies to copyright law.

• There was no mention of licensing the bigger models (when someone builds an app using someone else’s AI).

• There were also no bans of any kind on highest-risk activity.

Let’s see how this plays out.

Toyota’s profits are up nearly threefold

Demand for hybrid vehicles has created blowout profits for the automaker, who posted a 155% increase in Q2. 

Toyota started with humble beginnings in the textile industry. That’s right, the founder Sakichi Toyoda, invented the world's first automatic loom and set up the Toyoda Spinning and Weaving Company in 1918.

The company says they sold more cars from the start of this year until September than all of last year.

But it’s not just about sales. With Toyota based in Japan, these profits are posted in Japanese Yen. But, with global sales in USD, and a Yen that’s not as strong as it used to be, the conversion starts to make a big difference.

is it time to start buying stocks in foreign companies making huge sums in the West as foreign currencies worldwide decline (some more than others)? (Not financial advice).

Let’s see how it plays out.

U.S stocks rally as interest rate increases put on pause

The Federal Reserve held interest rates for the second month in a row after raising them eleven consecutive times since March of 2022.

While “red-hot” demand keeps prices high, fed officials cite “below-trend growth” as a good sign in their pursuit of 2% inflation.

The general expectation is that the economy will lose some steam (which is good news), and should normalize. Americans are dealing with depleted pandemic savings, higher borrowing costs, and resumed student loan payments.

So how do we know if it’s working? We’ll have a much better idea after this holiday season.

CANADIAN CORNER

Canadian Corner: slowing immigration targets

For the first time in over a decade, the government will not raise its immigration targets post-2026 (when the current target’s timeline ends).

It’s important to note they’re not necessarily “cutting” targets (at least not yet), but it is a shocking move with many implications.

But why?

• Immigrants are 23% of the total population.

• Immigrants make up 33% of all paid workers and staff.

• Immigrants are typically younger and help counter Canada’s aging population.

The key is the second point, where they actively contribute to our economy.

Pressures on housing.

Canada (the 2nd largest country in the world by land mass) does not have enough homes, and immigration targets are slowing down specifically to reduce further issues to the nation’s housing crisis.

If Canada’s about 3.5M homes short of mostly fixing the crisis by 2030, adding millions more people who need homes probably won’t make it easier.

Let’s see how it plays out.

Wrapping Up:

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