When you think back on 2023, how will you remember it?
For me, this will always be the year I became a grandparent. It will be the year I spent a lot of precious time with loved ones—whether on the pickleball court or over a rousing game of Settlers of Catan. And 2023 marked the first time I used artificial intelligence for work and other serious reasons, not just to mess around and create parody song lyrics for my friends.
This year gave us a glimpse of how AI will shape the future, and as 2023 comes to a close, I’m thinking more than ever about the world today’s young people will inherit. In last year’s letter, I wrote about how the prospect of becoming a grandparent made me reflect on the world my granddaughter will be born into. Now I’m thinking more about the world she will inherit and what it will be like decades from now, when her generation is in charge.
I can begin to picture it: the tools she will use, the ways she will stay in touch with her loved ones, the problems these innovations will help solve. We now have a better sense of what types of jobs AI will be able to do by itself and which ones it will serve as a copilot for. And it’s clearer than ever how AI can be used to improve access to education, mental health, and more. It motivates me to make sure this technology helps reduce—and doesn’t contribute to—the awful inequities we see around the world. I've always been a firm believer in the power of innovation to offer every child an equal chance to survive and thrive. AI is no exception.
The early years of a new age are often marked by lots of changes. If you are old enough to remember, think back to the beginning of the internet. At first, you probably didn’t know many people who were using it. But it became more common over time until, one day, you realized most people had email addresses, bought things online, and used search engines to answer their questions.
I loved getting to know my new granddaughter this year.
We are just at the beginning of this transition right now. This is an exciting and confusing time, and if you haven’t figured out how to make the best use of AI yet, you are not alone. I thought I would use AI tools for the foundation’s strategy reviews this year, which require reading hundreds of pages of briefing materials that an AI could accurately summarize for me. But old habits are hard to break, and I ended up preparing for them the same way I always do.
Of course, AI is far from the only defining feature of 2023. Millions continue to experience unbearable grief as a result of Russia’s war on Ukraine and in the aftermath of the war in Ethiopia. My heart is broken for the continued suffering of Israelis and Palestinians, as well as for the people of Sudan. At the same time, more people are being forced to endure hardship as a result of more frequent extreme weather events caused by climate change. And families around the world continue to be hit hard by rising inflation and slow economic growth.
There’s no question these are challenging times, but I remain optimistic about the future. The speed of innovation has never been faster. We’re making big strides on tough problems—like Alzheimer’s, obesity, and sickle cell disease—that will improve the lives of millions of people. My friend the late Hans Rosling used to say that “things can be bad and getting better.” It’s a good reminder that progress is not only possible but happening every day.
The team at CAPRISA in South Africa is using data to improve treatments for patients infected with both HIV and tuberculosis.
A Ugandan nurse examines a participant’s test during a clinical trial for an HIV vaccine. (Luke Dray/ Getty)
The team at CAPRISA in South Africa is using data to improve treatments for patients infected with both HIV and tuberculosis.
A Ugandan nurse examines a participant’s test during a clinical trial for an HIV vaccine. (Luke Dray/ Getty)
That’s why I remain dedicated to making sure that, even in the face of setbacks, the world continues to do more to help the poorest people. I do the bulk of this work through the Gates Foundation, where my colleagues remain dedicated to improving global health, education, gender equality, and more. While I could write a thousand pages about the incredible work they’re doing with our partners, this letter focuses on just a few of the most exciting breakthroughs.
I also write about why I’m optimistic about the world’s climate progress. Most of my climate and energy work is done through Breakthrough Energy, although the Gates Foundation is helping people in low- and middle-income countries adapt to a warming world. I also continue to privately fund research into other areas like Alzheimer’s disease. And I still get to advise Microsoft, which gives me insight into what’s coming down the pipeline and how it can be used to make the world a more equitable place.
I’m lucky that my work gives me insight into all the ways the world is getting better. The challenges we face feel a lot less daunting when you understand what exactly it will take to tackle them. In this letter, I will share just a few reasons I am optimistic about the year ahead. I hope they make you as excited about all the progress to come as I am.
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Following months of cooling inflation, higher rent and food prices pushed the inflation report to a 3.4% annual rate, according to the latest Consumer Price Index report. The rise indicates the Fed's ongoing challenge to achieve a 2% target inflation rate may experience some fluctuations along the way.
In December, the Fed set the housing market abuzz with hints of interest rate cuts in 2024. Given inflation's bumpy ride, borrowers may need to wait until later in the year for rate cuts, if they come at all.
Although the Fed doesn't set mortgage rates, it does set the federal funds rate—the rate at which banks lend money to each other overnight. Mortgage rates indirectly tend to rise and fall in anticipation of the Fed's interest rate moves.
Inflation, interest rates and other economic factors will undoubtedly impact U.S. homebuyers, who are trying to read the tea leaves and game plan for buying a house. Will 2024 be a better or worse year for homebuyers? We asked several real estate experts and professionals to provide their expert opinions on buying a home in 2024.
If you're considering buying a home then start by seeing what mortgage rate you could qualify for here.
"2024 is bound to be a better year for homebuyers, if only because of how terrible 2023 was," says John Graff, CEO at Ashby & Graff Real Estate.
Graff anticipates falling interest rates and increasing inventory could result in more opportunities for homebuyers in the months ahead. "As rates slowly come down from highs not previously seen in decades, more and more housing inventory will open up as on-the-fence sellers start to list their homes—giving buyers some more options in an otherwise tight market," he notes.
"Even though interest rates aren't back at the historic lows they once were at during and after the pandemic, the fact they have pulled back from recent highs will surely entice new entries to the market," Graff says.
Even if the Fed does follow through on promises of rate cuts, they likely won't bottom out to the historically low rates of 2020 and 2021 anytime soon. That's a probability many experts like Lisa Simonsen, a Douglas Elliman Real Estate broker, are reminding borrowers of.
"2024 will be the year buyers begin to adjust to the new realities of the market," Simonsen notes. "Mortgage rates may feel high, but 6% or higher has been the general average mortgage rate in every decade aside from the years following the 2008 recession. Rates of 3% to 4% are the exception, not the rule."
Still, Simonsen anticipates more homebuying activity if mortgage rates fall. "The housing market is currently constrained by a lack of inventory. Lower rates will spur home sales and add much-needed inventory, leading to more transactions."
Start exploring your homebuying options here today.
Of course, homebuyers waiting for lower home prices and better financing options may find complications in 2024. Lower rates could lead to more competition and higher prices.
Michelle Mumoli, a broker-salesperson with New Jersey-based Compass, recently shared her insights on the evolving housing market and pointed to insufficient inventory and anticipated rate declines as factors continuing to drive up housing prices. "The lower interest rates have already brought buyers back into the market and have created much higher competition on homes, essentially raising home sale prices."
Low inventory is the bottleneck stifling a favorable market for homebuyers, which, as Simonsen notes, could take time to overcome. "Housing sales are expected to increase a bit this year, but inventory will remain comparatively low. Overall, we will continue to see a seller's market, particularly for homes that need little or no renovation work. These market trends will take some time to develop—rates never decline in a straight line—with incremental decreases over the next several years."
In some scenarios, it may make sense to buy a home now despite elevated mortgage rates. As the saying goes, "date the rate, marry the house." In other words, if you have the means to purchase a home now, it may be worth it since home prices generally rise over time, and you can refinance your home loan when mortgage rates drop in the future.
Regardless of what's going on with home prices and interest rates, buying a home is one of the most important decisions most Americans make. As such, it's essential to carefully consider your budget compared with the ongoing costs of owning a home, including your mortgage, taxes and maintenance costs. Calculate your monthly income and expenses to determine what you can afford. It's also wise to get pre-approved for a mortgage to help you understand your financial limits before you begin house hunting.