I want to be rich, powerful and famous, so I renamed The Leveling to “The LevAIlling” to reflect the growing interest in the introduction and capabilities of artificial intelligence (AI). But rest assured, readers, the output of these pages is all organic (I tried his ChatGPT a few months ago and was not impressed).
AI has been around for a long time, and so are many of its dangers. In “The Levelling,” I wrote about how algorithms cause and induce inequality and social injustice. Last summer we learned that the Spiez Institute in Switzerland (see last issue) has a very sinister site (not far from the Reichenbach Falls) whose specialty is the study of deadly toxins and infectious diseases. I warned you about the example. An experiment to introduce an AI-driven drug discovery platform called MegaSyn and investigate how it performs when liberated from its usual parameters.
So MegaSyn has created nearly 40,000 designs of standard combinations of potentially lethal bioweapons, some as deadly as VX. This is a perfect example of how a morally unbounded machine (humans willingly crossed this moral threshold) can produce very negative consequences. Another recent note, Talos, explored some of the emerging philosophical questions about AI.
GoogleGOOG vs MicrosoftMSFT
Two aspects of the AI story that we haven’t touched on yet are the stock market and the labor market, both of which will be significantly impacted by AI.
A sure sign that AI is coming is that it is causing a stock market bubble. Ten companies have led the performance of the S&P 500 index since the beginning of the year, and nearly all of them have some form of AI business.
In particular, Nvidia, which appears to have been at the center of multiple market bubbles (Bitcoin, gaming, semiconductors), is playing a leading role in the AI investment trend. From a valuation standpoint, the company’s stock is trading at 30 times its sales (3 times his is very expensive for a normal company), which marks the peak of a “trend” or craze. It’s not too far from the standard valuation. foam. What we have yet to experience is a broader AI bubble in the sense that even companies temporarily associated with AI and its necessary infrastructure are trading at bubble valuations. Similarly, the market does not factor in the level of competition among AI-centric tech giants (Microsoft vs. Google) rather than the disruptive threats facing open source AI projects.
End of EM
The same is true in the venture capital world, where AI funds and companies are one of the few “hot” areas for VCs. The popular AI “discovery” by the media has had a tremendous impact on the VC world in that it provides an impetus for funds to put money into AI-centric projects. Remarkably, just as the value of companies that added “dot.com” skyrocketed in 1999, various companies now advertise their AI credentials and label their business with AI. I am letting it slip.
Additionally, companies that report earnings, talk about earnings on conference calls, or appear on financial television (i.e. CNBC) slip the phrase “AI” into their dialogue, which is how AI-driven analytics It will be detected and will be reflected in the stock price. purchase the program.
If one common reaction to any new innovation is that it will create an investment bubble, another is that Bitcoin was supposed to replace the dollar and the euro. It is about fatally destroying the “old world”. AI promises to take our jobs.
From ‘stay home’ to ‘big resignation’ to ‘digital economy’, the labor market has already softened in the last five years, but has probably never been this strong (among the G7) . While there are several fields that are being disrupted by AI (the EU no longer needs 17% translators), the best example I’ve come across is from surgeons to soldiers, where high-performance humans We are using robots and artificial intelligence to carry out our work. work gets better.
Consulting deals on the future of the labor market are now on the rise (WEF’s Future of the Job Market 2023 report is a good starting point). One area overlooked by much of this research is the emerging market workforce. Regulation, social welfare and training levels are not as developed as in Europe, for example.
In some large emerging countries like India, training and education can become cookie-cutter (although I’m not a fan of Byju), and knowledge workers in those countries tend to be artificial. It can be subject to destruction by intelligence. I believe this is a major drawback of AI for labor. Because if the impact of artificial intelligence on jobs is as big as many say, it could slow the natural path towards productivity and high incomes in many emerging economies, the majority of them. is. Some of them don’t have the industry/capital base or expertise to build their own AI platform (as Google does).
Currently, there is also little policy coordination among emerging economies, which again leaves them vulnerable in the face of AI. AI vs EM could be one of 21 major contestscent century.
