2023 has been a dramatic year — featuring everything the second- and third-largest banking collapse in US history, historic victories won by labor unions and the rise of ChatGPT and generative AI.
Let’s take a look back at some of the financial news headlines that shaped the year
Silicon Valley Bank and First Republic Bank (NYSE:FRC) fail
In March, the Federal Deposit Insurance Corporation (FDIC) took over the assets of Silicon Valley Bank after it lost $1.8 billion on an asset sale. The financial institution serving the tech startup industry became the third-largest banking collapse in US history.
SVB’s collapse torpedoed regional banking stocks and sparked a vintage banking run, with Signature Bank falling shortly thereafter.
SVB was ultimately bought by North Carolina-based lender First Citizens Bank, which took on $56 billion of customer deposits.
In May, First Republic Bank (NYSE:FRC) failed, too, before it was rescued by JPMorgan Chase, which acquired $173 billion of loans and $30 billion of securities and reopened 84 First Republic locations.
Thankfully for investors, the contagion largely stopped there.
Sam Bankman-Fried convicted
Speaking of collapses, Sam Bankman-Fried, founder and former head of collapsed cryptocurrency exchange FTX, was found guilty of fraud and money laundering in March.
More than $8 billion in customer funds disappeared when FTX collapsed in November 2022, leading to Bankman-Fried’s extradition to the US from the Bahamas, where he lived an opulent lifestyle in the confines of a beachside mansion.
It is now known that he illegally funded this lifestyle through stolen funds, which he also used to pursue political agendas and investments in the cryptocurrency sector.
Sentencing is scheduled for March 28, 2024, when Bankman-Fried could be given a life sentence.
Nvidia reaches $1T market cap
In May, Nvidia Corporation (NASDAQ:NVDA) became the latest tech company to join the $1 trillion club on the heels of blockbuster first-quarter earnings.
Since then, the chipmaking giant has launched Israel-1, a supercomputer aimed at meeting soaring artificial intelligence (AI) demand and announced the H200 graphics processing unit coming in the second quarter of 2024.
The H200 has 1.4x the memory bandwidth and 1.8x the memory capacity of the H100 chip, which OpenAI used to train GPT-4.
Sam Altman and the OpenAI circus
On November 17, ChatGPT developer OpenAI suddenly and unexpectedly announced that CEO Sam Altman would be stepping down immediately, with accusations from the board of directors that Altman “not consistently candid in his communications.”
The ensuing weekend saw OpenAI employees threaten to leave the company en masse, Altman quickly accept a new AI leadership role at Microsoft and former Twitch CEO Emmett Shear take over as Altman’s successor.
Shear vowed to investigate Altman’s ouster, and two days later he ceded the CEO role back to Altman with a new board of directors in place.
Leaving the board were Georgetown University’s Helen Toner, Tasha McCauley, a scientist at Rand Corporation, and OpenAI co-founder Ilya Sutskever.
Labor unions win big contract fights
The United Auto Workers negotiated historic labor agreements at Ford, General Motors and Chrysler-owner Stellantis after a targeted strike of all three automakers that lasted six weeks.
The record-setting contracts will increase base wages by 25% through April 2028 and includes COLA (cost-of-living adjustments).
Now, the question is how the new deals will affect costs. Ford CFO John Lawyer has estimated that the agreement would increase costs by $850 to $950 per vehicle.
Meanwhile, the Writers Guild of America (WGA) and the Screen Actors Guild-American Federation of Television and Radio Artists (SAG-AFTRA) reached deals with the Alliance of Motion Picture and Television Producers (AMPTP) trade association and Hollywood studios, respectively, after months-long strikes.
Crucially, both deals include protections against the use of artificial intelligence. Under the WGA, AI cannot “be used to undermine a writer's credit or separated rights,” and the SAG-AFTRA agreement protects actors from unauthorized use of their likenesses with AI.
Barbenheimer and Taylor Swift
Speaking of the studios, shares of AMC Entertainment Holdings (NYSE:AMC) rode a "Barbenheimer bounce" in August after the theater operator reported its best financial performance since 2019.
Blockbusters such as Barbie and Oppenheimer (which gave birth to the portmanteau term) along with the latest instalment of Mission Impossible, have packed in aisles in American theaters.
Then there’s Taylor Swift, whose The Eras Tour has been nothing short of a cultural force.
AMC shares got another jolt from Swift’s concert film, which surpassed $250 million in global box office sales in November.
The film took the crown for highest-grossing concert movie in its opening weekend from the previous record holder 2011’s 'Justin Bieber: Never Say Never,' which grossed $99 million worldwide.
Federal Reserve ends its tightening cycle
Jerome Powell, perhaps the Taylor Swift of monetary policy, signaled that three interest rate cuts could be coming in 2024 following the Federal Open Market Committee’s December meeting.
The US Federal Reserve left interest rates unchanged for its third consecutive meeting at a target range of 5.25%-5.5%, a decision largely anticipated by analysts and investors.
However, markets rallied on the committee’s projection of at least three rate cuts in 2024, which would bring to an end a tightening cycle that has seen 11 hikes and the highest interest rates in more than two decades.