Summer of Admitting Mistakes! *
The term “Mea culpa” means “by me” or “my fault,” but I much prefer the simpler modern expression: “My bad.” We have recently witnessed a wave of admissions of error. And it is long overdue.
Last year, Dario Amodei, the founder of Anthropic, stated there was a 25 percent chance that things could go very wrong due to artificial intelligence; indeed, in 2023 he warned of the possibility of human extinction. But as AI companies approach trillion-dollar valuations, he and OpenAI CEO Sam Altman have shifted strongly toward optimism. Amodei recently said he believes we will be able to cure most human diseases within five to ten years. In other words: we will be cured before AI kills us! As for Altman, when asked about the catastrophe of job losses, he simply said, “I’m glad I was wrong.” Well.
Meanwhile, Leopold Aschenbrenner, the 25-year-old young fund manager, wrote to investors in July after his fund lost 67 percent, stating, “We let you down this month.” Indeed! The fund had gained more than 400 percent over the year, with assets reaching $45 billion, and had invested in AI, energy, memory, and cloud computing stocks. But it made a beginner’s mistake: it used four times leverage.
The problem is that he did not realize he had become part of the market himself. Everything he bought went up, so he continued buying. When stocks began to fall, margin calls rained down on him. The rule I always repeat is: “Stocks hurt, but leverage kills.” And this time, it was his mistake.
Treasury Secretary Scott Bessent plans to increase purchases of long-term U.S. bonds starting September 9 to curb yields, while intervening, alongside Japan, to support the yen. Why? And will it succeed? The yield on Japan’s 10-year bond has risen to 2.9 percent, compared to 1.6 percent a year ago.
The problem is that years of low Japanese interest rates fueled the “carry trade”: borrowing in cheap yen and investing the money elsewhere in the world. This may be one reason why U.S. stocks have continued to rise and hedge funds have been able to use leverage at minimal cost. The volume of this trade is estimated to have reached around $20 trillion in 2023, and may be even larger now. It is a massive amount of hot money, so it is better that the bubble does not burst too quickly.
Democrats were also supposed to have a moment of admitting error. But that is unlikely to happen. Ram Emanuel summarized the current collective mindset by saying, “We are the only country where you have to be rich enough to be a socialist.”
In San Francisco, car thefts dropped from 22,700 cases in 2022 to 1,764 so far in 2026. This is partly due to increased surveillance, but also to a change in state law that eliminated a loophole requiring prosecutors to prove that all car doors were locked. This is another significant admission of error.
In the automotive sector, Stellantis brought back the Hemi V-8 engines for Ram trucks because customers wanted them. The six-cylinder turbo engine was good, but according to one customer, “it felt like you were driving a Honda.” Similarly, Ford has backed away from its fully electric F-150 Lightning truck. It is simply a return to what worked after what was introduced failed. Why do corporate management teams always forget the first rule of business: “Make your customers happy”?
Even Elon Musk, known for his opposition to fossil fuels and for selling millions of electric vehicles, has come to advocate for the use of natural gas turbines in data centers and chip factories. Realism prevails over stubbornness.
In May, the American Bar Association abolished a rule that had required law schools to demonstrate their commitment to diversity in hiring, admissions, and student programs. It was late, but it was the right move. In contrast, the Department of Education has launched investigations into five medical schools over suspected racial discrimination.
But the most commendable admission of error came from Representative Alexandria Ocasio-Cortez, who stated that “the first version of cancel culture was insane.” Well, whatever. Although she was one of its most prominent defenders, I thank her for evolving. As for me, I propose we rename that era “Cancel Culture Zero,” a mix of nonsense, anxiety, and pretension that leaves you empty and rots your mind.
