Economy

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Entrepreneurs say use of artificial intelligence for a variety of tasks is accelerating the path to hiring and, ideally, profitability.Sean Ammirati has been teaching a class on entrepreneurship for more than a decade.A professor at Carnegie Mellon University, Mr. Ammirati has groups of mostly graduate students start businesses from scratch over the course of the spring semester. Some of the start-ups that his 49 students created this year were classic examples of the form: a dating app for couples in long-distance relationships, a personalized fitness app.But Mr. Ammirati also noticed something unusual.“I have a pretty good sense how fast the progress that students should make in a semester should be,” he said. “In 14 years, I’ve never seen students make the kind of progress that they made this year.”And he knew exactly why that was the case. For the first time, Mr. Ammirati had encouraged his students to use generative artificial intelligence as part of their process — “think of generative A.I as your co-founder,” he recalled telling them.The students began sharing their ideas for use cases on a dedicated Slack channel. They used generative A.I. tools such ChatGPT, GitHub Copilot and FlowiseAI to help them with tasks including marketing, coding, product development and recruitment of early customers.By the end of the class in May, venture capitalists were descending on Carnegie Mellon’s campus in Pittsburgh.“It felt to me like what I felt like in the mid-2000s, when cloud and mobile happened at the same time,” said Mr. Ammirati, who is himself an entrepreneur. Generative A.I., he believed, could similarly change innovation “by an order of magnitude.”We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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Luke Sharrett/Bloomberg via Getty Images

Egg prices are climbing, placing the household staple back in the spotlight as consumers stay concerned not only about inflation but the absolute level of prices.
July marked a third straight month that egg prices rose on an annual basis, a reversal from a year of relative decreases. The culprit was a continued battle against the highly pathogenic avian influenza, known in short as HPAI or the bird flu.

Prices for the vital food ingredient soared 19.1% in July compared with the same month a year prior, according to consumer price index, or CPI, data released this week. By comparison, the entire CPI basket of items rose just 2.9% over the same period.

Inflation in egg prices became a focus for consumers during the pandemic given their ubiquity in everyday cooking. Increases in eggs and other groceries have been top of mind for consumers grappling with higher costs, in turn hurting consumer sentiment in recent years.
But the latest inflationary wave appears more connected to a spike of nearly 8% from March to April, which can be tied to seasonal patterns in the bird flu. That was largest month-over-month increase since the spring of 2023.
“The short answer, we think, is related to avian influenza,” said Caitlinn Hubbell, market research analyst at Purdue University’s Center for Food Demand Analysis and Sustainability in West Lafayette, Indiana. “As unfortunate as that is, the high-path avian influenza has continued to be around.”

The bird flu had a historic outbreak in 2022 and surged once again at the end of 2023. More recently, Hubbell said resurgences in Colorado and California have hurt supplies.

Egg demand is considered “inelastic,” Hubbell said, meaning consumers will usually buy the same amount regardless of price increases. On the flip side, she noted that consumers usually won’t stock up when they see lower costs.
Inelastic items tend to see big price changes from even small changes in supply, she said. That can underscore the impact of any bird flu outbreaks on the prices customers see on grocery store shelves.

For shoppers, this has resulted in higher prices. The average rate for a dozen large, Grade A eggs topped $3 in July for the first time in more than a year, according to the Bureau of Labor Statistics.
Despite this reacceleration, prices are still more than 20% below levels seen last year. Nonetheless, the price of eggs tracked within the CPI basket is up about 42% compared with July 2021.

Looking ahead, Hubbell said price movements will hinge on the state of the bird flu. But she’s hopeful consumers can see some relief with upcoming seasons less likely to bring outbreaks.
“It’s hard to tell,” Hubbell said. “It all depends on the impact in the size and scope of HPAI.” More

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JAKARTA (Reuters) – Indonesia’s outgoing government submitted a 2025 budget plan to parliament on Friday targeting a narrower deficit than this year, which analysts said signalled Southeast Asia’s largest economy would remain fiscally prudent under its next president.The budget proposal worth 3,613.1 trillion rupiah ($230 billion), prepared by ministers under outgoing President Joko Widodo and president-elect Prabowo Subianto’s economic team, projects a deficit of 2.53% of GDP next year, narrower than this year’s expected 2.7%.Total expenditure would be almost 6% higher than the forecast for this year.”We must continue structural reforms, maintain healthy and credible fiscal policy, and enhance collaboration of fiscal, monetary and finance policy,” Jokowi, as the president is widely known, told parliament.Investors have been paying close attention to Prabowo’s first budget, concerned that he might abandon strict fiscal rules after hinting in his speeches at an appetite for taking on more debt in order to achieve a GDP growth target of 8%.By law, the government must keep the annual fiscal deficit under 3% of GDP, while the outstanding public debt-to-GDP ratio cannot exceed 60%. That ratio is currently at 39%.”I think (the proposal) clarifies that the new government would be fiscally prudent, unlike the rumours about increasing the debt-to-GDP ratio to 50% in next five years that could translate to (an annual deficit of) over 4% to 5% of GDP,” said Handy Yunianto, head of fixed income at brokerage Mandiri Sekuritas.Handy said the deficit level was “positive for bond investors.”Economist Ryota Abe at Sumitomo Mitsui (NYSE:SMFG) Banking Corp said that the plan was roughly as expected but that the market still wants to see what policies Prabowo’s pick for finance minister pursues.”My specific focus is on how the next president Prabowo will try to accelerate Indonesia’s GDP growth to 8% without damaging fiscal policy and investors’ risk appetite,” he said.Prabowo, who attended the parliamentary session as defence minister, did not respond when asked whether he would change the budget once he takes over from Jokowi in October.ACHIEVABLE GDP GROWTH TARGETThe new budget proposal assumes the economy expands 5.2% in 2025, similar to the forecast range for GDP growth this year of 5% to 5.2%. Brian Lee, an economist with Maybank Investment Banking Group, said that growth target looked achievable in view of the expansionary plans in the budget and an expected monetary easing. Inflation in the proposal was projected at about 2.5% next year, the midpoint of the central bank’s target range. Based on GDP, inflation and other assumptions, the government has projected total revenues of 2,996.9 trillion rupiah next year, up 7% from this year’s outlook.The proposal called for a new excise tax on packaged sugary drinks but it did not go into details. On the spending side, 71 trillion rupiah is allocated to Prabowo’s flagship “Free Nutritious Meals” programme, unchanged from previous announcements on the programme. The programme is set to be implemented in stages, first in regions with high rates of poverty and stunted child growth, according to the proposal submitted to parliament.A total of 400.3 trillion rupiah is proposed for infrastructure spending, including for the continued construction of Indonesia’s new capital city.The proposal also calls for reform of the government’s energy subsidy policy, moving away from blanket subsidies to targeted distribution to individual beneficiaries.($1 = 15,686 rupiah) More

Ten-year treasury futures headed for a second weekly drop in a row on Friday, set for the largest fortnightly drop in nearly a year, even as a string of dismal economic indicators point to a slowing economy that would normally encourage bets on more policy easing and bond buying on one of the largest government bond markets in the world.Exchange-traded bond funds in China had a spike in outflows on several days in a week where state banks were heavy sellers and media affiliated to the People’s Bank of China reported warnings against reckless buying had begun to work.Some bond-owning domestic wealth management products also slid to discounts to net asset values. The price action points to a market hunkering down for a tussle with authorities, just a raft of new bond sales are due in the coming weeks and months.”What we are seeing here is a new round of PBOC action,” said Julio Callegari, chief investment officer for Asia fixed income at J.P. Morgan Asset Management.He has been reducing a long position in Chinese government bonds for months, partly in response to rhetoric from the central bank aimed at cooling the rally, and as a couple of months of solid bond issuance is expected ahead.”We are closer to neutral, our longs are smaller,” he said, with a reasonable scenario being yields eventually stabilising.Long-dated bonds have been the focus over the past two weeks as China has called out risks of an asset bubble and slapped restrictions on the duration of new bond funds and increased scrutiny over brokers and banks bond dealings.Ten-year yields on Friday were up nearly ten basis points (bps) from last week’s record lows, while 30-year yields have bounced 8 bps to 2.383%.Yields rise when bond prices fall.A week ago the number of wealth management products whose market value dropped below net asset value jumped to hit 385 the highest since March 2023, according to Zheshang Securities and the market is showing other signs of deteriorating. On Thursday just 30.9 billion yuan ($4.3 billion) worth of China’s current 10-year note was traded interbank compared to an average daily volume of 122 billion yuan last week.Zhao Jian, head of Atlantis Finance Research Institute, said that authorities’ moves to lift falling yields in a weak economy were “unfathomable,” in a commentary on social media.While aimed at reducing risk, he said the measures would likely damage market function by making participants reluctant to trade, eventually undercutting its financing and investing purpose. China will stick to a supportive monetary policy and maintain policy stability, its central bank governor Pan Gongsheng said in an interview with state news agency Xinhua on Thursday.VOLATILITYChina’s bond rally has run for years as pandemic lockdowns and a property-market collapse choked economic growth and the post-COVID recovery has disappointed at every turn – driving interest rates lower and therefore pushing bond prices higher.Bond market returns are higher than deposit rates, which is attracting households. New bank lending is also scraping 15-year lows meaning idle bank capital has also streamed into bonds.Authorities have pushed back, fearing a market bubble and the diversion of more and more money away from productive use.To be sure, none of those forces are weakening, leading to deepening battle lines between market participants and authorities.Bond supply is another wildcard, since as of end-July China had sold less than half of the combined 5.62 trillion yuan in local government and treasury bonds it plans for the year.Ju Wang, head of greater China currency and rates strategy at BNP Paribas (OTC:BNPQY), also notes that foreigners who have been drawn in by lucrative swap rates may take the opportunity to book profits and close positions.In a product disclosure on Thursday, the wealth management unit of Bank of Hangzhou said China’s weak economic recovery means it will be easier for yields to go down than to go up.But the bank expects more volatility as yields are already low, and is preparing to “seize trading opportunities”.($1 = 7.1730 Chinese yuan renminbi) More

Both candidates embrace expansions of government power to steer economic outcomes — but in vastly different areas.Vice President Kamala Harris and former President Donald J. Trump flew to North Carolina this week to deliver what were billed as major speeches on the economy. Neither laid out a comprehensive policy plan — not Ms. Harris in her half-hour focus on housing, groceries and prescription drugs, nor Mr. Trump in 80 minutes of sprinkling various proposals among musings about dangerous immigrants.But in their own ways, both candidates sent voters clear and important messages about their economic visions. Each embraced a vision of a powerful federal government, using its muscle to intervene in markets in pursuit of a stronger and more prosperous economy.They just disagreed, almost entirely, on when and how that power should be used.In Raleigh on Friday, Ms. Harris began to put her own stamp on the brand of progressive economics that has come to dominate Democratic politics over the last decade. That economic thinking embraces the idea that the federal government must act aggressively to foster competition and correct distortions in private markets.The approach seeks large tax increases on corporations and high earners, to fund assistance for low-income and middle-class workers who are struggling to build wealth for themselves and their children. At the same time, it provides big tax breaks to companies engaged in what Ms. Harris and other progressives see as delivering great economic benefit — like manufacturing technologies needed to fight global warming, or building affordable housing.That philosophy animated the policy agenda that Ms. Harris unveiled on Friday. She pledged to send up to $25,000 in down-payment assistance to every first-time home buyer over four years, while directing $40 billion to construction companies that build starter homes. She said she would permanently reinstate an expanded child tax credit that President Biden temporarily established with his 2021 stimulus law, while offering even more assistance to parents of newborns.She called for a federal ban on corporate price gouging on groceries and for new federal enforcement tools to punish companies that unfairly push up food prices. “My plan will include new penalties for opportunistic companies that exploit crises and break the rules,” she said, adding: “We will help the food industry become more competitive, because I believe competition is the lifeblood of our economy.”We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More