If you were a pilot, how would you feel about being told that the copilot who will be flying with you is fun to talk to but sometimes lies convincingly?

Microsoft is already rolling out products that use the AI systems it licensed from OpenAI. On Github.com, it has been offering something that it calls “Copilot” for a couple of years. I’ve tried it twice and each time decided I’m better off flying solo.

Microsoft has just announced a new “Security Copilot.” This could turn out badly.

After feeding the hype about the terrifying power of artificial intelligence, Sam Altman, the CEO of OpenAI, now confronts the downside of unrealistic expectations. Last week, he disclosed a bug in OpenAI’s software that leaked sensitive user information. The natural response is the question posed in the title. If his AI systems are so powerful that they can read and write code, why didn’t his team use AI to spot and fix the problem in its own software?

In my last post I wrote, "lazy insiders could just lend to a corporation they control, have it pay them a huge salary, then declare bankruptcy when the loan proceeds are all gone." But of course, there is an even lazier strategy. Hire your son a Senior V.P. and pay him a $3.5 million; and pay your brother-in-law $2.3 million as a consultant.

The lesson from the 1980s that everyone seems to have forgotten (or never wanted to know), is that bank losses from interest rate risk merely set the stage. It's the strategies that insiders use to loot their doomed institutions that cause so much trouble. As you read about what happened at SVB, remember that insider loans are the leading indicator of looting.

One week ago, I wrote that my point estimate of the decrease in inflation during the last quarter of 2022 was 300 basis points, with a subjective uncertainty interval of (-100, 400).

The data for February offer less support for a large decrease in the inflation rate. My updated point estimate is a decrease in the inflation rate of 250 basis points, with an uncertainty interval of (-200, 350).

The odds that inflation fell still seem to be higher than the odds that it increased, but the difference is not as big as it seemed before.