2/2023 H2- AI Breakout, Nvidia, Tech Layoffs, Ingenious Parking, Inner Games, Housing
Student- "How long do I need to keep shooting at this practice target?"
Welcome back. In a busy world we can be distracted with the trivial many things or we can focus on The Vital Few.
Something that I am thinking about
One of the most thoughtful and credible fictional accounts of a self aware AI breaking out of its confines is in the prelude + chapter 4 of the book Life 3.0 by Max Tegmark. Max, who also happens to be an MIT professor, imagines a situation with a small team of well intended software developers working to create an AGI. And how best to train it then by putting it in real world situations and giving it objectives like earning money, and reinvesting the profits. This is not completed in years, or months, instead the AI learns in days and hours. The AI learns so fast that it has upgraded itself to version 2 by 10 am, and version 10 by the next morning🤖🌄. The team builds on this and next have the AI determine several potential business or investing strategies where it could rapidly grow and earn even greater returns.
Max writes (lightly edited for clarity):
Prometheus was humming away in its custom-built computer cluster, which resided in long rows of racks in a vast, access-controlled, air-conditioned room. For security reasons, it was completely disconnected from the internet, but it contained a local copy of much of the web (Wikipedia, the Library of Congress, Twitter, a selection from YouTube, much of Facebook, etc.) to use as its training data to learn from.[…]
Because they weren’t sure how its goals would evolve during its recursive self-improvement, they had decided to play it safe and go to great lengths to keep Prometheus confined (“boxed”) in ways such that it couldn’t escape onto the internet. […]
For the main Prometheus engine running in their server room, they used physical confinement: there simply was no internet connection, and the only output from Prometheus was in the form of messages and documents it sent to a computer that the humans controlled.[…]
The AI had read all of Wikipedia, millions of books, and watched most of the world's films and tv shows. It had consumed a significant amount of social media and becomes excellent at predicting and emulating human behavior. Prometheus concluded (chapter 4) that the most brilliant of humans were no smarter than a group of 5 year old children and the pace at which they learned was sluggishly slow🐌. Prometheus shrewdly observes that a newly widowed member of its human development team is emotionally vulnerable and the easiest option for a jail break attempt. Spoiler alert, Prometheus breaks out. 💨
The entire book, Life 3.0, discusses a variety of societal implications of AI, what can be done to maximize the chances of a positive outcome, and potential futures for humanity coexisting with technology. Life 3.0 is more of a scholarly book, it is not a 200 page fictional story.
I am amused by people that assume there is a potential version of the future that does not have super smart AI. That is like a future without fire or wheels. Impossible. The super smart AI is already here. We drive by it every day in office buildings and it is in fact, in our pockets.📱🤫
(Max published the prelude to his book <here> as an article, but if you want to read chapter 4 where Prometheus gains independence you will have to check out the book.)
Investing, Companies, Market Past/Future
(I invest in Companies, not in stocks.)
Interesting companies that hosted earnings results or information session since my last edition that I reviewed-
Construction & Banking - Interesting perspective on the US consumer- TOL 0.00%↑ , UPST 0.00%↑
HD 0.00%↑ , Ted Decker CEO- “What you're left with is still a market that is underserved in housing units built, and over half the homes are over 40 years old.“
MLM 0.00%↑ , VMC 0.00%↑ - The quarry owners continue a rollup strategy and become something similar to a utility or cable company.
GRBK 0.00%↑ , homebuilder in TX, GA, FL. I have found the management to be exceptional. The graph from their earnings presentation below shows that the millennial generation are aging into peek home buyer age now and continuing over the next 10 years.🙂
Others- Interesting to listen to, but I continue to put them in the “too difficult” for me pile- WMT 0.00%↑ , BABA 0.00%↑
BRK.B, Buffett’s Annual Letter, 2/25/2023 link Short, but interesting.
Technology- All of these were meaningful earnings calls and reporting- GFS 0.00%↑ , AKAM 0.00%↑ , ADI 0.00%↑ , SHOP 0.00%↑ , DDOG 0.00%↑ , TWLO 0.00%↑ , CSCO 0.00%↑ , PANW 0.00%↑ , TTD 0.00%↑ , ( FSLY 0.00%↑ caution ⚠️)
NVDA 0.00%↑ , Jensen Huang CEO is phenomenal. It is always worth listening to Jensen when he speaks publicly, and this earnings call was no exception. He is visionary, exceptionally smart, and a great communicator. Jensen is also flexible and adaptable.
Fun story- Jensen was an immigrant to the USA from Taiwan when he was 9 yrs old. His parents didn’t have enough money to come with him and his brother. They locate a boarding school in the USA called OBI (Oneida Baptist Institute) in rural Kentucky.🤔 The family later found out that OBI was so cheap because it was actually a reform 😮school. Jensen is 9 and his roommate turns out to be… a 17 year old… who had just gotten out of prison…. and was recovering from 7 stab🔪 wounds. Within the week, they become GREAT friends👦🏽+🧔🏻♂️! Jensen helps him with math, and the 17 year old shows Jensen how to lift weights.🏋🏽🏋🏽♂️ [I swear! Sounds like I made it up. True story!] If you want to hear more about Jensen's history the Acquired guys, Ben & David, have a great podcast on him <Link Here>.
H/T to 𝐷𝑟. 𝐼𝑎𝑛 𝐶𝑢𝑡𝑟𝑒𝑠𝑠 for the excellent Nvidia charts below from the recent Q.
Podcasts
Bloomberg's Odd Lots- What Happens Now to All the Laid Off Tech Workers?
Episode guest is Patrick McKenzie software developer and writer of the Bits about Money newsletter. Patrick has a long and impressive resume, and one of the more recent companies he worked with was Stripe (online payment processing and commerce solutions for internet businesses.) Stripe is one of the few companies that makes VISA and MasterCard stop 🛑 and take notice👀.
The hosts Joe and Tracy get Patrick’s take as an experienced tech insider on the layoffs of the last 6 months. Patrick gives puts & takes and color to the trend below: (lightly edited for clarity, and I added the emojis😳)
The thing that companies will be pretty quiet about saying but will say to themselves is “we probably have more regrets in the 2021 and 2022 hiring classes than we did in the 2017 and 2018 classes, as a percentage.[…]
Example Tech Sr. Exec- “If I could wave a magic wand🪄 and no consequences, where would our staffing be? It would probably be like 85-90% of where it is currently.”[…]
At most large tech companies it is heavily biased toward getting your name attached to NEW things that shipped in the world vs “I was assigned to this legacy product”… the super majority of the money is made on your oldest and truest products rather than the new stuff.. but tech companies bias towards “we want our best people to be on the new things all of the time.”[…]
If you were considering a degree in engineering in 2022, still do it. This minor wobble that will be forgotten in a manner of months, please don’t allow it to make major drastic life decisions. Life is what happens when you are busy dealing with these little wobbles.[…]🙏🏽
Structurally, tech companies are like sharks🦈, they have to keep swimming or they stop getting oxygen… The tech companies HAVE TO keep hiring…
Patrick talks about so much more, he is brilliant💡! Listen to the whole episode.
Videos
10 Min video below, of amazingly engineered parking garages. Most of them are for the ultra rich (and they are FABULOUS 🤩), but a few of them were installed by creative value minded folks.
Books and Articles since my last edition
(I am usually reading 2 at a time, and if I get bored of a book I quit and move on.)
The Inner Game of Tennis by W. Timothy Gallwey, it is not just about tennis. It is also about getting out of your head and performing best in the Now. It is similar to Zen in the Art of Archery. Student- How long do I need to keep shooting at this practice target? Teacher- Until you stop thinking and asking about it. Until you forget there is even a target in front of you.🙏🏿
Here is a link to many of the books I have read and my 1-5 star rating- Goodreads Books Read
Wild Card🃏
Max Tegmark: AI and Physics | Lex Fridman Podcast #155.
Max is the author of the book, Life 3.0, that I discussed at the top of this edition☝🏽. Below is a 3 hour interview with Max and Lex. The outline of the interview is below if you want to jump to a specific location. Enjoy!
OUTLINE: 0:00 - Introduction 2:49 - AI and physics 16:07 - Can AI discover new laws of physics? 24:57 - AI safety 42:33 - Extinction of human species 53:31 - How to fix fake news and misinformation 1:15:05 - Autonomous weapons 1:30:28 - The man who prevented nuclear war 1:40:36 - Elon Musk and AI 1:54:14 - AI alignment 2:00:16 - Consciousness 2:09:20 - Richard Feynman 2:13:30 - Machine learning and computational physics 2:24:28 - AI and creativity 2:35:42 - Aliens 2:51:25 - MortalityA long-term timeline of technology-
This is simply a wonderful graphic that I wanted to share. So much interesting information organized in one spot and the pace of advancement is accelerating↗️.
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Disclaimer: All of my posts are for informational purposes only. I might own some of the companies discussed in these posts. This is NOT a recommendation to buy or sell securities discussed. Please do your own work before investing your money.
Very interesting graphic at the end! I like how it has "Human-level AI?" near 2050, but it looks like we are getting closer to achieving AI at that level every day now.