AI in its present form has limitations. By definition, AI powered computer programmes itself and learns as it goes along. In the process, it creates a database of information, which it uses to generate additional computer programming code as it keeps on learning more without any human assistance.

All these programmes require huge carefully categorised data to be smart. If the data is carelessly characterised, the machine arrives at the wrong conclusions. An object can be misinterpreted by an image recognition programme, say a slight change in image makes the computer perceive a vehicle as a rhino. AI thus is ineffective if there is no carefully categorised data.

To make driverless cars successful, video footage of actual surroundings on the roads is gathered and is labelled. To deal with certain situations, unfortunately data is not yet available, say crash data. Data from other sources is collected when it is absent. Such dummy data is useful in some areas, but is hazardous in some situations.

When there are accidents, there is no adequate data about them, and hence predictive models built here are neural. There are the safety concerns, and these halt the progress of the autonomous or driverless cars. It is difficult for such cars to navigate a K-turn.

Computers cannot be always better than us in making decisions. They are good at maths and calculations. Still regression models the computers use to make predictions or recognise pattern are very old. A group of birds on the roads makes autonomous cars brake or swerve, whereas the normal car drivers would continue driving slowly as they know birds will fly off.

Autonomous cars work ideally in controlled situations.

Three US economists — Ben Bernanke, Douglas Diamond and Philip Dybvig, have been awarded the Nobel in Economics, 2022 for their work on the role of bank in the economy, particularly during financial crisis. The key take away from their work is avoiding bank collapses is vital.

Banks are the intermediaries between the depositors and borrowers. These banks channelize the household savings to borrowers who make investments. Depositors expect their savings to be accessible instantly when the need arises. Borrowers expect the banks not to demand the loans back suddenly. It is maturity transformation process. Banks as intermediaries create liquidity. Deposits are short maturity liabilities. Borrowers investments are long-term assets. In normal course, all depositors do not want their money back at the same time. Banks thus are able to transform these short-maturity funds into long-maturity assets, which are nothing but loans to the borrowers.

There is a possibility of bank runs. Banks are thus vulnerable. There could be a fairly normal recession. It could result into an economic crisis if banks collapse on account of bank runs. Here people are worried about a bank’s survival and rush to withdraw their deposits in large numbers at the same time. If enough people do this simultaneously, the bank’s reserves cannot cover all the withdrawals. It goes bankrupt. In the 1930s, there were bank bankruptcies on account of panic bank runs.

Banks need to be protected from this type of vulnerability. Diamond and Dybvig proposed several measures including government-backed deposit insurance. Deposit insurance can prevent a bank run before it happens. Diamond and Dybvig wrote a paper in 1983 about the fundamental conflicts between the needs of the savers and depositors.

Depositors are assured that the money is safe. In the 1930s, to alleviate the crisis. Federal Deposit Insurance Corporation was set up. In addition, borrowers must be evaluated properly for the safety of the depositors.

Bernanke’s research studied the causes of depression. He wrote an article in 1983 which analyses the Great Depression of the 1930s. Bank’s failures were previously seen as a consequence of financial crisis. After Bernanke’s paper, it was proved that it is exactly the opposite. Bank failures are the cause of financial crisis.

The joint work of these three economists have laid the foundation of modern banking regulations. Their inputs facilitated the government policy in 2008 financial crisis.

Already we have experienced manual bank branches. Banking is new computerised and digitalised. Let us call it Bank 2.0. Experts feel that we are moving to Bank 3.0, that is ‘banking as a service model.’

Banks will witness a change in product distribution and customer acquisition. Banks have commenced embedding products at the customer’s point of need. Banking as a service enables banks to embed their products such as accounts, payments, loans etc. in the customer’s buying journey in non-banking contexts. There are elements of self-service and automation.

While checking out from an e-commerce site, a customer is offered credit. An employee can access his wages early in a company. These are the examples of BaaS. It is contextual banking. BaaS will soon become mainstream. It will be an important revenue stream.

The customer acquisition costs can be lowered. New customer segments could be tapped. Merchant platforms can offer temporary overdrafts and working capital. Medium and small enterprises and micro enterprises can be tapped.

Customers can be encouraged to save for their health needs. There could be risk covers for life-style data. BaaS could best work in partnership with other organisations. That is an expensive processes. There are regulatory hurdles. These constraints must be appreciated.

There are BaaS platforms with no-code/low-code capability. These facilitate the partners. These make everything economical.

By 2026, India will have a mobile user base of 1 billion. The digital banking penetration would be 46 per cent by 2027. Embedded banking would receive a boost.

Taiwan contributes a whopping 41 per cent of the world’s chips with massive government assistance. It is the Mount Olympus of silicon chips. Morris Chang has established Taiwan Semiconductor Manufacturing Company (TSMC). He grew up in China and British Hong Kong. He went to the US to complete an engineering degree at MIT in 1958. He landed at Texas Instruments and worked on improving chip making machinery.

Texas Instruments erred in passing over Chang for CEO promotion in the early 1980s. At the invitation of Taiwanese government, he headed to Taiwan and set up TSMC as a fab. It used to make chips for other companies, there was no finished electronics.

Morris Chang is 91 now. Taiwan is the epicenter of chip making technology.

In Math-Graphics Programming platform, Matlab is extensively used. It is short for Matrix Laboratory, and is proprietary multi-paradigm language and numeric computing platform preferred by engineers and scientists to analyze data, develop algorithms and create models and applications.

The platform plots functions and data and allows implementation of algorithms and creation of user interfaces and interfacing with programmes written in other languages.

Matlab combines a desktop environment tuned for iterative analysis and design processes with a programming language that expresses matrix and array mathematics directly. At the heart of Matlab is the Matlab language , a matrix-based language, allowing the most natural expression of computational mathematics.

Matlab apps let you see how different algorithms work with your data. Iterate until you get your results and then automatically generate Matlab programme to reproduce or automate your work. Scale your analysis to run clusters, GPUs, and clouds with minor code changes. There is no need to rewrite the code or learn big data programming and out-of-memory techniques.

Matlab tool boxes are professionally developed, rigorously tested and fully documented.

It includes Live Editor for creating scripts that combine code, output and formatted text in an executable notebook.

Matlab is deployed to enterprise apps. It is run on embedded devices. These automatically convert Matlab algorithms to C/ C++, HDL and Cuda code to run the embedded processor and business systems. It integrates with model-based design. It works with Simulink to support model-based design which is used for multi-domain simulation, automatic code and test and verification of embedded systems. Model-based design tools like Matlab and Simulink provide a mathematical and visual approach to develop complex control systems. In an everchanging environment where deadlines are short, there is a quick adaptation. And hardware need not validate.

Matlab has capabilities of data analysis, graphics, programming, app building, external language interfaces, connecting to hardware, parallel computing, web and desktop deployment. Matlab can be run in cloud environments.

Matlab is not good at some algorithms, say bioinformatics. Python, a high level language, more user friendly, more portable and readable can be used.

To use Matlab, it is not necessary to have programming experience. You can express matrix and array mathematics using familiar syntax. There are thousands of built-in functions for common mathematical, scientific and engineering calculations. Once the Matlab syntax is grasped, then learning to use specific tool should be easy. There are easy-to-use, pre-defined functions and libraries.

Matlab and Simulink are extensively used in the automobile and aeronautical industries. It is commonly used in the embedded system of the cars. Math Works is the company that develops and sells Matlab and Simulink.

Simulink in a Matlab-based platform used to model and simulate physical systems. To illustrate, aerodynamic drag on a component of a plane.

Tesla uses Matlab models to understand battery energy flows. The car hardware is adapted to increase the efficiency and range.

Bosch uses it for accelerating embedded controller development and calibration.

Exhaust gas and air system are managed by inputs of temperature and pressure. Sensors are placed on exhaust and intake and other places. However, it makes it costlier. Model-based approach is good. And that is why Simulink is used.

C/C++ simulations show superior performance. Matlab Engine APIs are available for C/C++, Fortran and Java.

GNV Octave is the best Matlab alternative. Scilab is open source. It is similar to implementation of Matlab.

William Shockley is a Nobel winner physicist. He coinvented the transistors, which are packed on the billions of silicon chips along with other elements. He set up Shockely Semiconductors in 1955 in Mountain View, California. He wanted to be near his ailing mother who stayed in Palo Alto. This could be one reason for San Francisco Bay Area becoming the home of semiconductors.

However, the actual founding of Silicon Valley is attributed a group of eight engineers. Moore was one among them. He separated from Shockley in 1957. These eight together founded Fairchild Semiconductor. The leader was Bob Noyce who had invented microchip. Noyce founded Intel with Moore. Noyce died in 1990.

In the trade journal of radio industry, an article titled Cramming More Components Onto Integrated Circuits appeared on April 19, 1965. It was contributed by Gordon E. Moore, an electronics engineer. This article may be the most influential trade magazine article ever published.

Moore extrapolated his observations in the newly set up semiconductor industry in proximity of San Francisco. By doing so he was forecasting the future of computing.

Amongst either things, he predicted that the number of transistors that an engineer crams on a chip of silicon would double every two years. This projection has been borne out over the decades. It is now known as Moore’s Law. A chip could accommodate only 4 transistors some sixty years ago. It now can carry 11.8 billion.

Moore later went on to run Intel.

The RBI has floated a concept note on Central Bank Digital Currency (CBDC) on 7th October, 2022. The note spells out the responsibility of the central bank to provide the citizens a risk-free CBDC without any risks associated with private cryptos. Can digital fiat be put on par with private tokens? CBDC is not another Bitcoin. Cryptos are tokens. CBDC is a digital currency. CBDC cannot substitute virtual digital assets.

According to the RBI, by design cryptos bypass established and regulated intermediation and control arrangements. Such a system ensures integrity and stability of the monetary and financial ecosystem.

According to industry executives, the concept note takes a conservative and outdated view on cryptos.

Internationally, CBDCs are the outcome of the process to defend the monopoly of the fiat currency. It resists cryptos, rather than allowing it to co-exist. Industry executives feel CBDC nibbles the very proposition of decentralisation that cryptos put forward.

However, crypto companies find CBDC to be consistent with the digital ecosystem India has built so far, and expect the RBI to be more accommodative of private digital assets. Cryptos will never replace fiat.

The concept note takes a nuanced approach, and expects India to emerge as a digital economy. It is a great initiative to launch CBDC.

The RBI is disinclined to make a hasty transition to CBDC. Its design of CBDC leans towards that of the physical currency system. It aims to complement and not replace the existing system. There are many design choices for the CBDC. The concept note spells out the current choices. CBDC will cater to both the retail and wholesale sector. The RBI could select an intermediate model — CBDC will be issued to licensed intermediaries who distribute it further, similar to how cash is distributed. CBDC would be non-interest bearing so as to prevent competition from the interest-bearing cash deposits. The retail CBDC would be token-based and the wholesale, account-based. Finally, CBDC would preserve anonymity, similar to cash.

CBDC, as an instrument, can be exchanged on par with a physical currency.

About 10 countries have launched CBDC. Over 100 countries are said to exploring the possibility of introducing CBDC. Bahamas pioneered it in 2020. China and South Korea are the major economies who have launched pilots.

The concept note of RBI states that the potential impact of CBDCs on monetary policy is still unclear. It will best to have a CBDC in India that is interoperable with the existing payment systems.

CBDC will facilitate real-time cross-border payments. Central banks can jointly develop an international settlement platform. If major currencies which are stable and flow through this system, there is no need to have reserve currency such as dollar. That is looking too far in future.

Once upon a time, cryptos were esoteric, but these days these have become mainstream. All over the world, there are 30 crore plus crypto users. With the spread of cryptos, it is time to think about the effects of crypto mining on the environment.

As we already know, Bitcoin is mined by solving complex mathematical puzzles using high-powered computers. These computers consume a lot of electricity. Bitcoin uses proof-of-work mechanism.

It is time to change to environment-friendly proof-of-stake technology. Ethereum started running on two parallel blockchains — a legacy Ethereum Mainnet which uses proof-of-work and Beconchain, a new blockchain that uses proof-of-stake. This happened in December 2020, and Ethreum called it a Merge event. Merge combined Ethereum Mainnet with Beaconchain. In Beconchain, miners pledge an investment in the digital currency before validating a transaction. To validate blocks, they are required to put up stakes with coins. Later, an algorithm selects a validator who gets to add the next block to the blockchain, depending upon the amount of cryptos he or she has staked. It spares the computers from solving mathematical puzzles by power guzzling. Of course, one has to make considerable investment. Moneyed people will have an upper hand. An investor has to invest minimum of 32 ETH to be a validator. As an ETH trades at $1300, there is an investment outlay of $41600. It is an expensive proposition.

Ethereum’s complete switch to a proof of stake makes it an attractive product for environment-conscious people. Its carbon footprint will reduce by 99.95 per cent.

Bitcoin too has reduced its reliance on fossil fuels. However, it is marginal last year. Its energy was derived from fossil fuels to the extent of 65 per cent, and at present it is 62 per cent.

Ethereum has been proactive to address the environmental concerns. Some other cryptos too use less energy-intensive mechanisms. Such currencies are Nano, Solarcoin, Cardano, IOTA. Chia and others.

The European Parliament has approved new rules to introduce a single charging port for most electronic devices (October 2022). The idea is to standardise the charging port. The choice went in favour of USB Type C or USB C as the standard port. All electronic devices must have a USB C port. Laptops have been allowed a time frame up to 2026 to comply with this . The devices operate with a power delivery of 100 watts. The different chargers form a huge amount of e-waste yearly in the European Union.The move will curtail the e-waste considerably.

USB C is easy to plug in. This connector is capable of transmitting both data and power over a single cable. It supports fast charging (100 Watts) required by large devices.

How it is useful depends on how the rules are implemented. Different manufacturers use USB C for different utilities. There are different protocols and standards pertaining to USB C.

Apple will be most affected by the new rules since USB C is used by Android-based devices. Apple has been given a grace period of two years to sync its devices with USB C.