Tuesday, March 28, 2023

☕ East-West split

Housing prices are diverging in weird ways…
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Morning Brew

Revela

Good morning. Yesterday, at a school in Nashville, three children and three adults were killed in the US' 129th mass shooting this year, which is defined by the Gun Violence Archive as an incident where four or more people are shot and either injured or killed. That's equivalent to ~10 mass shootings per week in 2023, or almost two per day.

Sam Klebanov, Neal Freyman, Jamie Wilde, Abby Rubenstein

MARKETS

Nasdaq

11,768.84

S&P

3,977.53

Dow

32,432.08

10-Year

3.537%

Bitcoin

$27,132.09

Hershey

$250.90

*Stock data as of market close, cryptocurrency data as of 4:00am ET. Here's what these numbers mean.

  • Markets: Stocks were a mixed bag yesterday, but both the S&P 500 and the Dow gained as investors seemed ready to put the collapse of Silicon Valley Bank in the rearview mirror, giving regional banks a boost. Investors might have also been in the mood for a nosh, because snack-makers Hershey and Mondelez both traded at all-time highs.

 

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WORLD

Tour de headlines

Police outside Nashville, Tennessee's Convent School @MNPDNashville/Twitter

Shooting at Nashville elementary school leaves six dead. Three children and three adults were killed yesterday in a shooting at The Covenant School, a private Presbyterian elementary school in Nashville, Tennessee. The six victims have been identified as Evelyn Dieckhaus, Hallie Scruggs, and William Kinney, who were nine years old, and Cynthia Peak, Mike Hill, and Katherine Koonce, adults in their early sixties. Koonce is believed to have been the head of the school.

The shooter was also killed while exchanging fire with police. Police identified the suspected attacker as a 28 year-old former student of the school. According to police, the shooter, who entered the school with at least two assault-style rifles and a handgun, had written a manifesto and drawn detailed maps of the school before the attack. In the aftermath, there was confusion regarding the assailant's gender because police initially said the alleged shooter was a woman before saying the shooter was transgender. Several news outlets reported that the suspect used male pronouns in recent LinkedIn postings.

Israel postpones controversial judicial overhaul. Israel's Prime Minister Benjamin Netanyahu said yesterday that "to avoid civil war," he would delay his plan to bring the country's judiciary more under the ruling party's power until after it could be debated during the next parliamentary session in April. The decision came after strikes and mass protests brought the country to a standstill. After the announcement, the leader of Israel's largest trade union said it would call off the general strike by its 800,000 members.

ARTIFICIAL INTELLIGENCE

Stylin' Pope Francis is regrettably fake

The pope in a stylish coat Midjourney/Reddit

"Pope Francis? More like Pope fashionista " was everyone's reaction this weekend to a viral photo of the pontiff sporting a stylish puffer jacket looking like he marched straight out of Milan fashion week (it's the one on the left). However, to the disappointment of the Very Online of all creeds, the image turned out to be an AI-generated deepfake.

But before the realistic-looking image's authenticity was debunked, most of Twitter (including half of our editorial team) took it at face value and subsequently felt mildly embarrassed at being so easily duped (speaking for ourselves).

Where it came from: "Balenciaga Pope" was brought to us by Midjourney, an artificial intelligence app that generates images from text prompts. This masterpiece was created and posted to Reddit along with several other images of the pope in the puffer by a user who was apparently just trying to have a laugh while tripping on magic mushrooms, per BuzzFeed.

What gives it away: Upon closer inspection, the picture does offer some clues that it isn't actually a candid shot snapped by the paparazzi on the streets of Vatican City. Some tell-tale signs:

  • The Pope's glasses look like they're melting onto his face.
  • The crucifix appears somewhat deformed.

Why people are still unnerved

Midjourney's ability to make us marvel at the Pope's chic 'fit got people thinking about what rapid advances in hyperrealistic AI art mean for our post-truth world. Web culture journalist Ryan Broderick called the papal hoax the first "mass-level AI misinformation case."

Another recent, viral, AI-made image showed it could be used to spread false narratives for more politically polarizing topics than the pope's fashion choices. Investigative journalist Eliot Higgins used Midjourney to churn out a series of images depicting former President Donald Trump getting arrested after an on-foot police chase amid talk of an impending indictment (Higgins later got banned from Midjourney for doing so).

Looking ahead…AI expert Henry Ajder told Business Insider he's urging AI companies to embed safeguards—like watermarks for manipulated images and disclaimers for videos—into the technology to prevent it from being weaponized for fake news.—SK

        

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CRYPTO

Next up on regulators' crypto takedown: Binance

Binance CEO Antonio Masiello/Getty Images

Yesterday, the Commodity Futures Trading Commission (CFTC) sued Binance, the world's largest crypto exchange, along with its co-founder Changpeng Zhao and its former Chief Compliance Officer Samuel Lim—for allegedly evading US regulations.

The CFTC alleges that Binance…

  • Didn't have an effective program in place to prevent money laundering.
  • Encouraged customers to access Binance via virtual private networks (VPNs), allowing them to make unpermitted trades from the US.
  • Built a base of high-net-worth "VIP" customers and gave them a heads-up when law enforcement looked into their assets.

The agency claims Binance's money laundering reporting officer once told Lim, "We see the bad, but we close 2 eyes."

Zhao, known in the crypto world as CZ, released a statement saying the suit contained "an incomplete recitation of facts" and that the company disagreed with the characterization of many issues.

Big picture: US regulators are bringing down the hammer on crypto companies…even though they're already thoroughly smooshed following the collapse of crypto exchange FTX and, more recently, of crypto banks Silvergate Capital and Signature Bank.

Last Wednesday alone, another major financial regulatory body, the Securities and Exchange Commission (SEC) *takes deep breath* sued the Tron blockchain network, as well as Lindsay Lohan, Soulja Boy, and six other crypto-promoting celebrities, and it issued a warning to the crypto exchange Coinbase that enforcement actions are on the way. The crypto crackdown is here.—JW

        

REAL ESTATE

East Coast, beast coast (for housing prices)

Illustration of a map of the US with homes dotted on it Morning Brew

The East Coast–West Coast rivalry is typically associated with rappers or sports teams, but now the divisions are extending to…the housing market.

Just like the sun, home prices are dropping in the West while rising in the East, according to the Wall Street Journal. This stark geographical split is extremely unusual and highlights Covid's role in shuffling people around the country in weird ways. The key stats:

  • West of Texas (but including Austin), home prices in the 12 major housing markets fell in January on an annual basis, data from Black Knight showed.
  • But home prices increased in the 37 largest metros east of Colorado (excluding Austin).

What's going on? Western "Zoom Towns" that welcomed an influx of residents during the pandemic (think Boise) saw their bubbly home prices start to pop as mortgage rates spiked. Plus, the tech hubs that were so dang unaffordable even before Covid (SF, San Jose) have taken a hit from the recent downturn in the sector.

Meanwhile, on the East Coast, consistent job growth, tight housing inventory, and the fact that many cities there didn't see a ludicrous price boom during Covid are helping push prices higher.

Big picture: Nationally, the median home price dropped annually in February for the first time in more than a decade, and experts predict more year over year declines in many markets.—NF

        

TOGETHER WITH BABBEL

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GRAB BAG

Key performance indicators

Keanu Reeves at the John Wick premiere Axelle/Bauer-Griffin/Getty Images

Stat: John Wick is a man of focus, commitment, and sheer will—but very few words. The puppy-loving hitman played by Keanu Reeves says just 380 words in John Wick: Chapter 4, despite the film's nearly three-hour run time, according to the WSJ. Reeves himself hacked the dialogue down, the film's director said, and 27% of the 103 lines spoken by Wick in the final cut are a single word. If reports that the actor was paid $15 million to reprise the role are accurate, that's $39,473 per word.

Quote: "I've been here for 15 years giving my & witty thoughts all for bupkis. Now you're telling me that I have to pay for something you gave me for free?"

Celebrities are not amused by Elon Musk's decision to remove all blue verification check marks from Twitter except ones that are paid for on April 1 (a date we're sure will not inspire any pranksters). William Shatner called out the chief twit by name in a tweet asking about the upcoming change, but Musk was unmoved by the star's Earl Grey hot take. He responded that it was about equality and that "there shouldn't be a different standard for celebrities." Yesterday, Musk said the paid-for check would be required to be featured in the For You feed and to vote in polls as of April 15.

Read: The wild story behind a smear campaign and the hackers that exposed it to its target. (The New Yorker)

NEWS

What else is brewing

  • Lyft's founders will step down from their CEO and president roles and the day-to-day running of the company as it struggles to keep up with rival Uber.
  • Disney will begin its first round of layoffs this week, CEO Bob Iger told employees. The company plans to cut 7,000 jobs to bring costs down.
  • California's ski resorts have gotten so much snow that they're planning to stay open through June.
  • Prince Harry and Elton John went to court in London yesterday to watch proceedings in a case they and other high-profile Brits brought against tabloids for allegedly invading their privacy. Stateside, the trial over Gwyneth Paltrow's ski accident continued.

RECS

Dive deep: Check out the winners of an underwater photography contest.

Boost your artificial intelligence intelligence: Tips to make your ChatGPT prompts better.

'90s heroes: Imagine who would play the Avengers if the movies had been made back when everyone wore flannel and platform sneakers the first time around.

We hope it's good wine: This French couple won't let anything spoil their evening at the cafe.

Tax tip: If you're a remote worker who works for a company located in another state, get the lowdown on the specific tax implications you should know.

Promising pick: Scanning the stocks for a favorable up-and-comer? The Motley Fool has their eyes set on an "All In" pick that'll top your searches—and "All In" has a history of success. Get the deets.* 

*This is sponsored advertising content.

GAMES

The puzzle section

Brew Mini: For solvers trying to defeat Neal, your time to beat on today's puzzle is 30 seconds flat. Play it here.

Cinema trivia

Earlier, we wrote about the minimal dialogue Keanue Reeves has as John Wick. Here's a question about another actor with a limited presence in a movie:

In 1992, an actor won the Academy Award for best actor despite appearing in the film for just 16 minutes total. Who was the actor, and what was the movie? (Hint: The movie also won best picture that year.)

AROUND THE BREW

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ANSWER

Anthony Hopkins as Hannibal Lecter in The Silence of the Lambs.

         

Written by Neal Freyman, Sam Klebanov, Jamie Wilde, and Abigail Rubenstein

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