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Southeast Asia added 70 million online shoppers since Covid: Report

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Grab delivery cyclists ride past each other in Singapore on April 20, 2020.

ROSLAN RAHMAN | AFP | Getty Images

An estimated 70 million more people shopped online in six Southeast Asian countries since the pandemic began, according to a report from Facebook and Bain & Company.

As governments encouraged people to stay home to slow the spread of the coronavirus, Southeast Asia saw a rapid adoption of digital services like e-commerce, food delivery, and online payment methods.

And that trend is likely to continue. The report, which surveyed more than 16,000 people in Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam, projected the number of digital consumers in Southeast Asia will reach 350 million by the end of this year.

By the end of 2021, Facebook and Bain expect more than 70% of people 15-years-old and above in the surveyed countries to shop online. The report predicted the number of online shoppers in Southeast Asia will reach 380 million by 2026.

Among surveyed countries, the report said Indonesia, Southeast Asia’s largest economy, continues to see the highest growth rate. Its digital consumer population is predicted to grow around 15%, from 144 million in 2020 to 165 million in 2021.

E-commerce boom

Many parts of Southeast Asia are grappling with a resurgence of Covid due to the highly transmissible delta variant. Vaccination rates remain low in some emerging economies. As intermittent lockdowns and movement restrictions make it difficult for consumers to visit brick-and-mortar shops, many e-commerce markets have thrived.

The survey, which was conducted in May, found that the share of respondents who said they shop “mostly online” rose from 33% in 2020 to 45% this year, with the greatest gains coming from Singapore, Malaysia and the Philippines.

Facebook and Bain projected that average online spending will grow 60% this year from $238 per person in 2020 to $381 per digital consumer. Online retail’s share of overall retail surged in Southeast Asia from 5% in 2020 to 9%, the report said, noting that paces is faster than in Brazil, China or India.

“Over the next five years, Southeast Asia’s ecommerce sales is also projected to keep pace with these countries, growing at 14% per year,” the report said.

Fintech investments reach new heights

With more purchases being made online, fintech services such as “buy now, pay later,” digital wallets and cryptocurrencies have also become more widespread.

In the first three months of the year, 88% of private equity and venture capital investments in the region flowed into the technology and internet sector. Of that, 56% went into financial technology, according to the report.

“We are looking at a massive triple explosion of fintech. Not only are regulators removing the regulation barriers, we’ll also see a roaring river of capital with no friction,” Dmitry Levit of Cento Ventures said in the report.

Digital wallets were the preferred payment option for 37% of respondents, compared with 28% who preferred cash, 19% for credit or debit cards and 15% in favor of bank transfers. The Philippines, Malaysia and Vietnam saw the biggest gains in digital wallet adoption, at 133%, 87% and 82% growth, respectively.

Southeast Asia’s rapid digitalization during the pandemic proves the immense opportunity in the region’s digital economy, the report said.

“The region will be a growth market for at least the next 10 years as new verticals, industries and products emerge,” Justin Hall, partner at Golden Gate Ventures said in the report.

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David Tepper doesn’t think stocks are a great investment here, but says it all depends on rates

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David Tepper, founder and president of Appaloosa Management.

David Orrell | CNBC

Hedge fund manager David Tepper turned somewhat bearish on the stock market, citing uncertainties around interest rates and inflation.

“I don’t think it’s a great investment right year” Tepper said on CNBC’s “Halftime Report” on Friday. “I just don’t know how interest rates are going to behave next year… I don’t think there’s any great asset classes right now… I don’t love stocks. I don’t love bonds. I don’t love junk bonds.”

The founder of Appaloosa Management, whose comments have been known to move markets, said his hedge funds has been “probably too conservative” this year but has done okay because of its bets on commodities and oil.

“We continued to keep that exposure relatively low but keep investing, I think stay invested in the stock market to some extent, but don’t have your highest concentration you’ve ever had,” Tepper said.

The billionaire investor has made a number of prescient calls recently, including foreseeing the market collapse due to the Covid-19 pandemic. Back in February 2020 before the S&P 500 tumbled into a bear market, he warned that the virus could be a game changer for markets and “certainly ruined the environment” for stocks.

In March this year, Tepper turned bullish on the market, saying it’s very difficult to be bearish on stocks. The S&P 500 enjoyed seven positive months in a row from February to August, The benchmark is up more than 20%, hitting a fresh all-time high Friday.

This is breaking news. Please check back for updates.

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Surveillance AI is more concerning than AGI

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Peter Thiel, co-founder and chairman of Palantir Technologies Inc., speaks during a news conference in Tokyo, Japan, on Monday, Nov. 18, 2019.

Kiyoshi Ota | Bloomberg | Getty Images

LONDON — Tech billionaire Peter Thiel believes that people should be more worried about “surveillance AI” rather than artificial general intelligences, which are hypothetical AI systems with superhuman abilities.

The venture capitalist, who co-founded big data firm Palantir, said at an event in Miami on Wednesday that on the path to AGI, you get surveillance AI, which he described as a “communist totalitarian technology.”

Those that are worried about AGI aren’t actually “paying attention to the thing that really matters,” Thiel said, adding that governments will use AI-powered facial recognition technology to control people.  

His comments come three years after Bloomberg reported that “Palantir knows everything about you.” Thiel has also invested in facial recognition company Clearview AI and surveillance start-up Anduril.

Palantir, which has a market value of $48 billion, has developed data trawling technology that intelligence agencies and governments use for surveillance and to spot suspicious patterns in public and private databases. Customers reportedly include the CIA, FBI, and the U.S. Army.

AGI, depicted in a negative light in sci-fi movies such as “The Terminator” and “Ex Machina,” is being pursued by companies like DeepMind, which Thiel invested in before it was acquired by Google. Depending on who you ask, the timescale for reaching AGI ranges from a few years, to a few decades, to a few hundred years, to never.

Hype around AGI has diminished recently as people realized there’s still a long way to go despite some promising breakthroughs. The most advanced AI systems remain relatively “narrow” and unable to perform “general” tasks. An AI that can play the board game “Go” can’t also paint a picture, for example.  

Thiel, a well-known libertarian who also co-founded PayPal and holds a board seat at Facebook, said Silicon Valley isn’t talking about AGI as much today as it was six or seven years ago.

“Elon’s not talking about it anymore and Larry (Page) is off to Fiji and doesn’t seem to be working on it quite as hard,” he said, before going on to question why the AGI discussion hasn’t completely collapsed.

Murray Shanahan, a senior research scientist at DeepMind, said on Twitter that Thiel had an “interesting take” on AGI. He did not immediately respond when CNBC asked him to elaborate.

In the same talk, Thiel pitted AI against cryptocurrencies, saying that he’d prefer to see the latter one succeed.

“If we say crypto is libertarian and that it is fundamentally a force for decentralization, then I think we should also be willing to say that AI, especially in the low-tech surveillance form, is essentially communist.”

“If you want to frame it as a technological race … I want the crypto decentralized world to work,” he said.

Thiel added that he feels “underinvested” in bitcoin just hours after the world’s most popular cryptocurrency climbed to a new all-time high of just over $66,000 per coin.



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Trading in Trump SPAC reopens, is immediately halted again after shares surge more than 200%

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The social media app will be developed by Trump Media and Technology Group (TMTG).

Rafael Henrique | LightRocket | Getty Images

Digital World Acquisition Corp., the SPAC that is taking former President Donald Trump‘s planned social media platform public, soared Friday following a massive rally in the previous session.

Trading in the stock was halted due to volatility multiple times in morning trading Friday. The SPAC, which trades under the ticker DWAC on the Nasdaq, skyrocketed 216% before the latest trading halt. The stock surged more than 350% to close Thursday at $35.54 in explosive trading volume and volatility.

Phunware, the advertising software startup involved with Trump’s 2020 reelection campaign, jumped in unison with DWAC. The stock last traded up 1,099% to $16.82 per share Friday, bringing its week-to-date rally to nearly 1,700%.

SPAC stands for special purpose acquisition company, which raises money on the public markets with a goal of merging with a private company and taking it public within two years. Investors typically have no clue what the target company will be when the SPAC debuts and trades on the stock exchange.

Signs emerged that small-time retail investors could be behind the monstrous rally in the SPAC. On Thursday, DWAC the single most actively traded stock on Fidelity’s brokerage platform. Meanwhile, the ticker was among the most popular mentions on Reddit’s WallStreetBets. The SPAC was also a trending topic on Twitter, which indicated that DWAC could be having a meme stock moment like GameStop and AMC.

One top post on the WallStreetBets message board Friday morning featured what appeared to be the user’s equity portfolio, touting daily gains of over $10,000 from betting on the SPAC. The post, which called the former president “Daddy Trump,” quickly drew more than 800 comments.

The new company, the yet-to-be-launched Trump Media & Technology Group, said its “mission is to create a rival to the liberal media consortium and fight back against the ‘Big Tech’ companies of Silicon Valley, which have used their unilateral power to silence opposing voices in America.”

The move came after Trump got banned by social media giants Twitter and Facebook since early this year after he was accused of inciting the Jan. 6 Capitol riot by a mob of his supporters. The violence interrupted the confirmation of Trump’s Electoral College loss to President Joe Biden.

Warrants in the SPAC, which trade under the ticker DWACW, also experienced outsized trading volume on Thursday. Warrants are a deal sweetener that offers early investors more compensation for their cash. They are contracts that give the holder the right to purchase additional shares in the future at a certain price.

— CNBC’s Dan Mangan contributed reporting.

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