Welcome back to your daily memorandum talking tech, business, AI, markets, and more. 🗞️

In today’s edition, we are tackling the following:

🛡️ Microsoft to stop using China-based engineers for Defense Department projects.
🚗 Tesla loses appeal in India even as Musk begins delivering vehicles.
📆 August 1 is a hard deadline for Trump tariffs, says Commerce Secretary Lutnick.
💰 Investor demand for yield boosts the growth of S&P 500 dividend options.
🗳️ Japan's prime minister remains despite a historic upper house election defeat.

TECHNOLOGY

• Microsoft to stop using China-based engineers for Defense Department projects

  • Microsoft will no longer allow China-based engineers to support Department of Defense cloud systems.

  • Pro Publica revealed that U.S. escorts lacked the technical knowledge to effectively supervise foreign engineers.

  • The Defense Secretary stressed that foreign engineers must never access or maintain DoD systems.

• Nvidia faces production hurdles as China chip sales attempt a restart

  • Nvidia has a limited supply of H20 chips for China due to U.S. export restrictions and bans.

  • TSMC halted H20 production after order cancellations, and restarting could take up to nine months.

  • Nvidia plans to launch a new RTX Pro GPU for China that complies with export regulations.

• Tesla loses appeal in India even as Musk begins delivering vehicles

  • Tesla opened its first showroom in India, but early supporters like Gondal feel underwhelmed.

  • Many early backers never received their Model 3s and struggled to get reservation refunds.

  • Long delays and poor communication have left loyal Indian Tesla fans frustrated and disappointed.

BUSINESS

• August 1 is a hard deadline for Trump tariffs, says Commerce Secretary Lutnick

  • August 1 is the deadline for countries to start paying reciprocal U.S. tariffs.

  • Smaller nations may face a baseline tariff rate of around 10 percent.

  • Larger economies must open markets or pay fair tariffs, according to Secretary Lutnick.

• Blackstone exits consortium bidding for TikTok US, according to a source

  • Blackstone exited a U.S. consortium aiming to acquire TikTok’s American operations amid mounting delays.

  • The deal faces uncertainty due to shifting deadlines, political pressure, and unresolved national security concerns.

  • ByteDance may restructure TikTok’s U.S. business, but China's resistance and Trump’s tariffs complicate negotiations.

• Investor demand for yield boosts the growth of S&P 500 dividend options

  • Growing U.S. investor demand for yield is boosting S&P 500 dividend derivatives trading.

  • Dividend futures and options allow speculation on corporate payouts and hedging long-term liabilities.

  • Once Europe-dominated, this niche market is now gaining traction among American investors.

MARKETS

WORLD

• Japan's prime minister remains despite a historic upper house election defeat

  • Prime Minister Shigeru Ishiba vowed to stay despite his coalition’s major election setback.

  • The ruling Liberal Democratic Party and Komeito lost their upper house majority on Sunday.

  • It’s the first time since 1955 that the LDP has governed without a legislative majority.

• China EV makers Zeekr and Neta inflated sales through an insurance scheme

  • Neta and Zeekr inflated EV sales by pre-insuring unsold cars to meet sales targets.

  • Over 64,000 of Neta’s reported sales were booked early using this “zero-mileage” tactic.

  • China plans to crack down on such practices amid concerns over unfair competition and market distortion.

• India's parliament faces backlash over controversial voter list revision

  • India’s opposition plans to challenge Modi’s government over revised electoral rolls in Bihar.

  • The Election Commission’s June revision may disenfranchise over 30 million marginalized voters.

  • Protests and legal actions have erupted ahead of key state elections in Bihar.

CONTENT

• Cognition CEO Scott Wu discusses the recent acquisition of Windsurf

  • Cognition CEO Scott Wu led a rapid $220M acquisition of Windsurf just days after licensing Google IP.

  • Wu’s background includes Olympiad gold medals and co-founding roles at Cognition and Scale AI.

  • Cognition claims $80M ARR in six months as AI writes 50% of new software code.

• Benjamin Mann discusses rapid AI progress and the need for responsible direction

  • Benjamin Mann left OpenAI to co-found Anthropic and focus on building safe, aligned AI systems.

  • He predicts AGI by 2027–2028 and believes 20% unemployment from AI is likely inevitable.

  • Mann emphasizes AI safety, critiques market dynamics, and shares skills he’s teaching his children.

• Scott Woody explains how AI is transforming software’s core value proposition today

  • Scott Woody and Martin Casado discuss how AI shifts software value from users to automated output.

  • Traditional SaaS models are evolving as pricing shifts from user-based to performance-based metrics.

  • They explore new billing models, GTM alignment, and strategy for AI-native and hybrid SaaS businesses.

FUTURISM

• Why Cartken pivoted its focus from last-mile delivery to industrial robots

  • Cartken is shifting focus from food delivery to industrial use after demand from factories and labs grew.

  • Its food delivery robot became the busiest unit after German firm ZF Lifetec used it for production tasks.

  • The robots required minimal changes, thanks to AI trained on diverse delivery data and terrain handling.

• AI may play a bigger role in recent layoffs than companies admit

  • IBM and Klarna openly acknowledged using AI to replace certain human employee roles.

  • Most companies frame layoffs as restructuring or optimization rather than AI-driven workforce reduction.

  • AI’s impact on job cuts may be larger than what firms are publicly disclosing.

• I asked Alexa Plus to handle tasks, and the results were mixed

  • Alexa Plus now understands natural speech without needing precise commands or rigid phrasing.

  • Its new agentic AI can handle tasks like bookings and scheduling with limited online integration.

  • Despite improvements, Alexa Plus still lacks the breadth to replace a real personal assistant.

EXTRAS

• New Zealand inflation rises more slowly than expected, reaching just 2.7%

  • New Zealand’s annual inflation rose to 2.7%, slightly below economists’ 2.8% forecast.

  • Inflation moved closer to the Reserve Bank’s 1-3% target band upper limit.

  • Consumer prices increased 0.5% quarter-on-quarter, under the expected 0.6% rise.

• China holds lending rates as weak consumer sentiment continues dragging the economic recovery

  • China's 1-year and 5-year LPRs impact corporate loans and mortgage rates, respectively.

  • Slower GDP growth and weak June retail sales reflect continued economic softness in China.

  • Analysts expect China may introduce economic support measures in the second half of 2024.

• Oil extends decline as trade talks and Russian energy curbs draw focus

  • Oil prices held steady after the first weekly decline in July amid trade uncertainties.

  • Brent crude stayed near $69 as markets watched U.S.-EU trade developments and energy policy.

  • EU preparing response to potential U.S. no-deal scenario before Trump’s August 1 tariff deadline.

AND MORE

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• Amazon raised prices on essentials after pledging to keep them low.

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• Kids’ content becomes key as streaming platforms focus on profitability.

• What is a Jet2 holiday, and why is it trending now?

• Our top cyber books on hacking, surveillance, crypto espionage, and more.

• The chaotic hunt for Labubus feels impossible until you finally win.

• Learn storytelling from Michael Lewis as he reveals how to turn complex ideas into captivating narratives.*

• Samsung Galaxy Z Fold 7 review stunning foldable with a premium price tag.