Market News 7/6

Markets

Yesterday, on the day following the July Fourth holiday, the Federal Reserve dampened the positive sentiment of investors enjoying their long weekend. The Dow and the S&P 500, which had been performing well for three consecutive days, experienced a decline after the release of minutes from the central bank's previous meeting. These minutes revealed that despite a pause in interest rate hikes last month, more increases are expected in the near future.

Tech

The initial legislation in the United States addressing bias in hiring tools related to artificial intelligence has become effective.

Yesterday marked the implementation of a groundbreaking law in New York City aimed at addressing potential biases in AI-powered hiring tools. As companies increasingly rely on artificial intelligence for hiring decisions, there is growing concern about the possibility of algorithmic biases affecting candidates. The new law seeks to ensure that if an AI system rejects a job applicant, it is not due to inherent biases in the algorithm.

This pioneering legislation acknowledges the reality that AI can replicate racist and sexist biases, as evidenced by a survey conducted by the Society for Human Resource Management, which revealed that nearly one in four companies already utilizes AI in their hiring processes.

Under this first-of-its-kind law, companies are obligated to fulfill certain requirements, including informing job candidates residing in New York City about the use of AI and allowing them to request information on the data being collected. Additionally, businesses must conduct independent audits on an annual basis for any AI tools used in employment decisions. The audits aim to ensure that these tools do not discriminate based on gender, race, or ethnicity, and companies must disclose ratios to demonstrate whether specific groups are disproportionately affected. Non-compliance with the law can result in fines of up to $1,500 per violation per day.

The introduction of this law has sparked diverse reactions. As with any AI-related development, there have been passionate responses from various stakeholders. The law was passed in 2021 but faced delays as policymakers sifted through numerous public comments to determine the most effective enforcement methods, often receiving feedback from businesses that deemed it an impractical burden.

However, some public interest groups and advocates argue that the final version of the law does not go far enough in eradicating discrimination. Since the law primarily focuses on AI making significant decisions, it may not encompass widely used tools that pre-screen job applicants before they are evaluated by human staff.

Environment

Japan has received approval to dispose of radioactive water into the ocean

On Tuesday, the United Nations' nuclear agency approved a disputed proposal by a nation to discharge over a million metric tons of treated but still radioactive wastewater from the Fukushima power plant, which was devastated in 2011, into the Pacific Ocean. While some neighboring countries have expressed objections, experts hold differing opinions on the safety of the plan and the potential for any adverse consequences resembling a "Godzilla situation." USA Today reports that other countries, including the United States and China, have previously disposed of diluted nuclear waste in the ocean.

Interesting Chronicles

Get ready to feel the heat

According to the US National Centers for Environmental Prediction, Tuesday was likely the hottest day on Earth in approximately 125,000 years, following the previous day's record-breaking temperatures. The global average temperature reached 62.92 degrees Fahrenheit. Experts, such as Professor Myles Allen from Oxford University's geosystem science department, warned that we can expect even hotter days in the future as multiple factors combine to intensify the heat. Describing the situation as a "triple whammy," Professor Allen explained the compounding effects leading to these increasingly scorching conditions.