Carry Trade Unwinding Was A Gift From Heaven

Here's what The Boss posted on X:

“This is a product launch post for GPT-4.5. Notice 4 ripe strawberries and one half ripe. Q* (code name Strawberry) represents the optimal action-value function in reinforcement learning.

It signifies the maximum expected reward that can be achieved.

This new version uses Monte Carlo Tree Search to figure out Q* and will likely lead straight to super-intelligence in a few years. Ya'll just got a gift: Now that the carry trade is unwound, you can buy your favorite AI stocks at a discount. $NVDA $SMCI $MSFT $TSM etc etc.”

I happen to know a thing or two about tree search because that's what powers The Boss' machine learning. I'm no John Koza, but this is right square in my wheelhouse.

Tree search is what Genetic Programming is all about… and I specifically said “no f-ing neural networks. I want to see the code.”

Which in hindsight was a good idea because it helped me spot stuff that doesn't make sense or data snooping.

Anyhoo…this tree search is going to help the AI think through different scenarios just like a human would in order to give you the best answer.

It's how AlphaGo started beating the best Go players in the world.

LLMs combined with Monte Carlo Tree Search is the path to AGI.

And my own internal tree search leads me to believe the most likely path going forward is an AI arms race to get to super intelligence.

Instead of helping blow up other countries and creating all this chaos and money laundering, maybe the U.S empire can put those trillions spent towards ASI (Artificial Super Intelligence).

I rarely make predictions, but this one seems obvious.

As always, I'm not a “buy n hope” guy… I'll be trading a wide range of stocks and ETFs. I will take losses when the strategy says to sell. I won't let a loss turn into a bigger loss because of my (very rare) prediction.

JP Morgan now says the carry trade is 75% unwound. Why not 77%? Sounds like a number pulled out of their keister.

But if that's the case, perhaps this “Crazy Ivan” decline will turn out to be a gift from heaven.

More from me soon…