Increased short-selling activity and volatility in shares have drawn increasing scrutiny by federal and state officials and regulators in recent days, given strong fundamentals in the sector and sufficient capital levels, said the source, who was not authorized to speak publicly.
"State and federal regulators and officials are increasingly attentive to the possibility of market manipulation regarding banking equities," the source said.
...
Short selling ... is not illegal and considered part of a healthy market. But manipulating stock prices, which the SEC has defined as the 'intentional or willful conduct designed to deceive or defraud investors by controlling or artificially affecting" stock prices, is.

May 3, 2023
PACIFIC WESTERN BANK ISSUES UPDATE
FOR IMMEDIATE RELEASE
...
The bank has not experienced out-of-the-ordinary deposit flows following the sale of First Republic Bank and other news. Core customer deposits have increased since March 31, 2023, with total deposits totaling $28 billion as of May 2, 2023 with insured deposits totaling 75% vs. 71% at quarter end and 73% as of April 24, 2023.

I suppose we will end up finding a number of answers to that question. Will some ChatGPT-style large language model manage to do some insider trading? Will it, like, ingest some corpus of data that includes inside information, and then use it to answer questions like “which stocks should I buy?” Will some big company’s corporate development department use the model to answer questions like “should we buy Company X and what price should we pay for it,” and will the developers of the model use that information nefariously? Will the model itself become sentient, get a Robinhood account and use that information nefariously? Etc.
Or I mean will someone ask ChatGPT a question like “what companies are frauds,” and ChatGPT will cheerfully and confidently say “oh Company Y is a total fraud, their revenues are super inflated,” and then people will short the stock, and then it will turn out that Company Y is fine and ChatGPT is just really good at confidently making stuff up? Is that securities fraud? By whom? (Or: Ask “what stocks are good,” ChatGPT says “Company Z is great, they have found a cure for cancer and their revenue will double,” people buy the stock, it was all made up.) Will sell-side analysts or journalists use ChatGPT to do their work, and will ChatGPT introduce market-moving factual mistakes?
Lots of fun possibilities. But the most immediate way in which ChatGPT is going to be securities fraud is the usual “everything is securities fraud” way:

• 1) ChatGPT is going to be disruptive to some number of businesses and industries.
• 2) Some companies will lose money because ChatGPT disrupts their business.
• 3) This will be bad, for them, and their stocks will drop.
• 4) Every bad thing that happens to a public company can be characterized as securities fraud: “You didn’t sufficiently warn us about the bad thing, so we bought the stock thinking it was good, but then the bad thing happened and the stock dropped, so we were defrauded.”

ChatGPT risk factors are starting to be included in securities offering documents, and the risks are starting to be realized:

Chegg Inc. plummeted 42% after warning that the ChatGPT tool is threatening growth of its homework-help services, one of the most notable market reactions yet to signs that generative AI is upending industries.
The company, which offers online guidance for students taking tests and writing essays, also gave revenue and profit forecasts for the current quarter that fell well short of analysts’ estimates. Chegg makes much of its money from subscriptions, which start at $15.95 a month, a revenue source that’s in peril if students see AI chatbots as an alternative to paying.
The impact of ChatGPT, an OpenAI tool that surged in popularity last year, began to be felt this spring, Chief Executive Officer Dan Rosensweig said in prepared remarks accompanying Chegg’s first-quarter earnings Monday.

And I tell you what, when I see that a public company has announced bad news and its stock dropped, I look for the lawsuits. We are early yet — the stock dropped yesterday — but lawyers move fast; I have not yet seen any lawsuits filed, but at least two law firms have announced “investigations” of Chegg and are looking for clients.
At this point the lawsuits seem a bit far-fetched: “You should have warned us months ago that artificial intelligence would hurt your business” is unfair given how quickly ChatGPT has exploded from nowhere to become a cultural and business phenomenon. But now everyone is on notice! If you are not warning your shareholders now about how AI could hurt your business, and then it does hurt your business, you’re gonna get sued.

An experimental Alzheimer’s medication slowed declines in patients’ ability to think clearly and perform daily tasks by more than a third in a large clinical trial, drugmaker Eli Lilly said Wednesday.
Based on the results, in people with early symptomatic Alzheimer’s disease, Lilly said it plans to file for approval from the US Food and Drug Administration by the end of June.
The medicine, donanemab, works by removing plaque buildups in the brain known as amyloid that are a hallmark of Alzheimer’s disease. However, there were some side effects reported; there were three deaths in the trial among people taking the drug, two of which were attributed to adverse events such as brain swelling or microhemorrhages, known as amyloid-related imaging abnormalities or ARIA. The trial was run in more than 1,700 patients for 18 months.
Alzheimer's drug lecanemab receives accelerated approval amid safety concerns
“For every medicine, for every disease, there are potential risks and potential benefits,” said Lilly’s chief scientific and medical officer, Dr. Daniel Skovronsky. But he noted that almost half of the participants taking the drug, 47%, showed no decline on a key measure of cognition over the course of a year, compared with 29% of people taking a placebo.
That’s “the kind of efficacy that’s never been seen before in Alzheimer’s disease,” Skovronsky said.
Alzheimer’s affects more than 6 million Americans, with an estimated 1.7 million to 2 million people over 65 in the early stages of the disease, according to Lilly. Drug development for Alzheimer’s has been riddled with failures, but Lilly’s drug is among a new group showing promise. The first, Eisai and Biogen’s Leqembi, received accelerated FDA approval in January.