theKapitalcurious

  Debate: Are Bigger AI Models the Future of Financial Modeling? In July 2025, a high‑profile paper from AQR’s Bryan Kelly reignited a long‑standing debate in quantitative finance: do larger, overparameterized AI and machine‑learning models genuinely deliver superior stock‑picking performance , or are they merely sophisticated mirror images of recent market trends? Kelly et al. claim that by embracing a phenomenon known as double descent , models with more parameters than data points can capture subtle, high‑frequency signals hidden in noisy financial markets. Critics—from Stanford’s Stefan Nagel to Oxford’s Nobel laureate John Campbell—offer a blunt rejoinder: these gains are largely symptomatic of recency bias and momentum, not genuine predictive power. This exchange underscores a core lesson for graduate‑level analysts: the integrity, transparency, and validation of a model matter as much as its raw complexity . 🟢 Case For Complexity: Unlocking Hidden Signals High‑Dimen...

  The Transmission of U.S. Monetary Policy to Global Financial Markets: A Contemporary Academic Overview Introduction: Real-Time Monetary Transmission Mechanisms In July 2025, global financial markets responded with acute sensitivity to diverging statements from U.S. Federal Reserve officials. Forward guidance regarding interest rates sparked immediate and measurable adjustments across asset classes. This post explores the mechanisms by which central bank communication—particularly forward guidance—transmits through international capital markets, affecting exchange rates, asset pricing, and investor sentiment. The event provides an ideal lens for advanced study in international monetary economics. Recent Developments and Macroeconomic Implications On July 17, 2025, Federal Reserve Governor Christopher Waller signaled support for an imminent interest rate cut. This contrasted with Chair Jerome Powell's more measured tone earlier in the week. The resulting divergence triggered...

 Hello and welcome! If you’ve stumbled upon this blog, chances are you’re a little like me—curious about the forces that shape global markets, fascinated by the machinery of modern finance, and always eager to decode the business decisions that move the world. My name is Kartikaiya Rathi , and The Kapital Curious is my personal space to explore and reflect on the dynamic, often perplexing, but always fascinating world of business and finance. This blog is born from two forces that define my intellectual identity: inquiry and intent . 💡 Why This Blog? In a world where numbers drive narratives, I’ve always found myself asking: Why did that market move? What does this merger signal? How do central banks play economic chess? I come to this space not as an expert, but as a student—both formally and by disposition. Whether I’m dissecting a financial concept, exploring an economic trend, or sharing insights from books, case studies, and real-world events, my goal is to bridge academ...