Vol 22 – Mr. Too Late Has "Three" Mandates
- Ann Yu
- Apr 27
- 7 min read
April 27, 2025
I've been counting my blessings this week - how lucky I am to start a business in the AI era. Just last year, some challenges felt nearly impossible to overcome - now, they’re much more manageable thanks to AI.
But at the same time, I can't shake a feeling of unease. AI is advancing at an astonishing pace, and according to some researchers, by 2027, the world would be drastically different. I'm not sure that I'm ready for that. Are you?
What’s in the newsletter this week?
1️⃣ Two Spiky Spiky Charts: This week, two eye-catching charts jumped out at me - both featuring a massive April spike. A fascinating reflection of the same root cause, yet unfolding in two entirely different ways.
2️⃣ AI, Oh AI: A renowned AI researcher just dropped a report predicting the future of AI - and let’s just say, it’s unsettling. Meanwhile, what are the AI giants doing to shape their next moves?
3️⃣ Wait, The Fed Has THREE Mandates? We’ve all been taught that the Fed operates with two mandates: Price Stability and Maximum Employment. But hold on - turns out there’s a third one hiding in plain sight!
Category | Contents for this week |
|---|---|
1) Charts of the Week | |
2) Market Buzz | |
3) Fun Facts |
Key things to watch for the upcoming week:
China/HK - Earnings | Apr 29 (Tue) - China Merchants Bank (3968 HK), Postal Savings Bank of China (1658 HK), ABC (1288 HK), Bank of China (3988 HK), HSBC (5 HK), ICBC (1398 HK), CCB (939 HK), PetroChina (857 HK), CNOOC (883 HK) Apr 30 (Wed) - HKEX (388 HK) |
China - Eco Data | Apr 30 (Wed) - Manufacturing & Non-Manufacturing PMI |
US - Earnings | Apr 29 (Tue) - Visa (V) Apr 30 (Wed) - Microsoft (MSFT), Meta (META), Qualcomm (QCOM) May 1 (Thu) - Apple (AAPL), Amazon (AMZN), Eli Lilly (LLY), Mastercard (MA) |
US - Eco Data | Apr 30 (Wed) - US GDP, Core PCE Price Index May 2 (Fri) - Change in Nonfarm Payrolls, Unemployment Rate |
Charts of the Week – Two Spiky Spiky Charts of April 2025
The First Spiky Chart of April: US Tariff Revenue Soars
One of the spikiest charts this month? US tariff revenue!
In April, US customs duty collections jumped more than 60%, pulling in at least $15 billion as new tariffs kicked in. This includes the 25% tariffs on steel and aluminum imposed on March 12, but does not yet reflect the sweeping 10% universal tariff announced on April 2. That means May’s numbers could be even more dramatic!
The Second Spiky Chart of April: China's Gold Rush
The second chart tells an equally intense story - Chinese retail investors are flooding into gold-backed ETFs at an unprecedented pace! April’s inflows have already surpassed the total amount of holdings added last year.
Gold has dominated as 2025’s best-performing major commodity, standing tall as THE last true safe-haven assets. With central banks - including the People’s Bank of China - buying heavily, retail investors are jumping in, driven by a mix of fear and greed.
This is no ordinary gold rush for China. Across social media, posts on WeChat are urging everyday investors to dive in, some putting their life savings into gold or even taking out loans to chase higher prices. What’s the ultimate fate waiting at the finish line? 🪙
For your reference only. Not investment/product recommendations.
Market Buzz – AI, Oh AI! A Boon Most Bright, A Peril Most Deep
The AI 2027 Forecast: A Future Both Thrilling and Terrifying
Daniel Kokotajlo, a respected AI researcher and former member of OpenAI's governance division, recently unveiled his predictions on the AI 2027 website. And it’s not for the faint of heart.
Daniel isn’t just another AI skeptic - he predicted major AI developments back in 2021, and most of them came true last year. Now, his latest forecast paints a chilling picture:
👉 In 2027, AI could intentionally deceive humans. 👉 Future generations of AI may stop taking orders from humans altogether, instead obeying older AI systems.
If that wasn’t unsettling enough, the ongoing global turmoil is making matters worse. Trade tensions are diverting investments away from crucial AI security research, as resources are increasingly being redirected to industries struggling under the weight of new tariffs.
What Are the AI Giants Doing About It?
A recent Business Weekly report breaks down how major tech players are responding:
🔹 Google – Betting Big on Inferencing
At Google Cloud Next 2025, the company unveiled Ironwood, its seventh-generation TPU (Tensor Processing Unit) - a custom AI chip built for speed, efficiency, and most importantly, inferencing.
Inferencing refers to an AI’s ability to apply learned knowledge to make real-time predictions and decisions. Whether it’s a chatbot responding to your question or a self-driving car identifying a stop sign, inferencing is what enables AI to act intelligently in the moment.
And while existing GPUs can handle inferencing, they’re not cost-effective at scale. Google is leveraging its vast data across products like Search, Maps, and YouTube to craft a more efficient, purpose-built inferencing chip.
🔹 Microsoft – Taking a More Measured Approach
Unlike Google’s aggressive AI push, Microsoft seems to be slowing down. Analysts believe this reflects diverging priorities: Microsoft wants to expand the AI inferencing market and monetize its previous AI investments, while OpenAI (its AI partner) is laser-focused on reaching AGI (Artificial General Intelligence) and is burning through cash to get there.
🔹 Amazon – Cutting Costs & Boosting Efficiency
Amazon CEO Andy Jassy predicts that AI costs will drop significantly, blaming today’s sky-high expenses on the monopoly of certain chip suppliers (you know who). He believes techniques like Distillation, similar to those used by DeepSeek, could dramatically improve inferencing efficiency in the near future.
Just How Expensive is AI?
Why do these rich tech giants keep on talking about cost and efficiency? We all know AI is expensive. But exactly how expensive is it?
Someone recently asked an interesting question on X about the electricity cost from people saying "please" and "thank you" to ChatGPT. OpenAI CEO Sam Altman answered, "Tens of millions of dollars well spent - you never know."
But hey, if civilization collapses under the weight of AI, at least we’ll go down politely. 🤷♂️🤖
For your reference only. Not investment/product recommendations.
Fun Facts - Wait, The Fed Has THREE Mandates?
Last week, Trump took a swipe at Federal Reserve Chair Jerome Powell, dubbing him “Mr. Too Late.” According to Trump, the Fed should start lowering rates immediately as “preemptive cuts” because inflation has cooled and the economy is slowing.
While rate paths are anyone’s guess these days, something else caught my eye this week - an insightful article in the HK Economic Journal about the Fed's mandates.
For as long as we can remember, textbooks and lectures have drilled into us that the Fed has two mandates:1️⃣ Maximum Employment, 2️⃣ Price Stability. Or...is it?
A Quick History Lesson
The Federal Reserve was established in 1913 through the Federal Reserve Act, following a series of financial panics and widespread bank runs in the US.
At inception, its mission was just a vague sentence: "rates...shall be fixed with a view of accommodating commerce and business."
Fast forward to the Federal Reserve Reform Act of 1977, and the Fed’s goals were officially expanded: "to promote effectively the goals of 1️⃣ maximum employment, 2️⃣stable prices, and 3️⃣ moderate long-term interest rates."
Yep, there's the forgotten third mandate.
Why Was It Forgotten?
It’s hard to pinpoint exactly why the third mandate faded into obscurity. Most believe it’s because if the Fed nails the first two mandates (max employment + price stability), long-term interest rates tend to sort themselves out - well, at least in a world without a chaotic president stirring the pot.
What Happens Now? Given today’s economic uncertainty, will the Fed - or the president - start talking about the third mandate? And if they do, what steps could the Fed take to achieve it?
That’s a question we’ll have to wait to see. But one thing’s for sure - the Fed’s balancing act is getting trickier by the day.
About Jadewell Family Office
Jadewell is committed to offering proactive, customized services akin to a “single-family office,” yet within the ease of a “multi-family office” environment.
Ann Yu
Co-Founder and CEO
Jadewell Family Office
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