The Singularity (Robots Take Over) and Artificial Intelligence

The Wikipedia definition of “The Singularity”:  “is a hypothetical moment in time when artificial intelligence will have progressed to the point of a greater-than-human intelligence, radically changing civilization, and perhaps human nature.[1] Because the capabilities of such an intelligence may be difficult for a human to comprehend, the technological singularity is often seen as an occurrence (akin to agravitational singularity) beyond which the future course of human history is unpredictable or even unfathomable.”

What most people think of when they think of situations like The Singularity, many people think of movies or fiction books (Skynet, The Matrix, 1984, etc.). Each envision a world where “the machines” are smarter than us and think on their own, without regard for the human condition, well-being. Famous entrepreneur and investor Peter Thiel, has  a particularly interesting take on all of this, much of which I agree with. To save you the time of watching the link, he says “all we [humanity] needs is The Singularity.” The reason I agree with the fundamental point of his message is that technology “usually” makes our lives easier, more efficient. More importantly, a new advancement in artificial intelligence would create new jobs where humans control the “smart machines”. Think of it as when machinery was first introduced to factories during the Industrial Revolution. The advent of machines in factories lowered the barrier to entry to the industry and encouraged new competition. For example, it took less “man-power” to produce thousands of garments in a day. Curating and maintaining a machine’s artificial intelligence will be the “factory job” of the future. This may sound odd, but that may be because artificial intelligence is commonly misunderstood.

By working at a startup that gets looped into the “artificial intelligence” realm/discussions, I’m well aware of its recent resurgence, popularity. And what’s comical/frustrating is the public’s view of what artificial intelligence is. We’ve made it a point in sales meetings to explain the different “flavors” of artificial intelligence. So let me set the record straight, artificial intelligence by and large can be: 1.) self-learning (machine-learning), 2.) mimick current human behavior, or 3.)  deep-learning. [Head over to the Narrative Science blog for more interesting pieces on this discussion.]

My larger point about point about all three types of AI is that, despite what you may think, all of these take human interaction and intervention. A computer has no sense of what is right and what is wrong, unless verified by a human. Computers can find interesting things in data (machine-learning), but only a human can verify that correlation equals causation. For example, a computer might find that the number of kiwis harvested increases fairly linearly with the number of deer killed each season in Wisconsin. This is useless, spurious correlation that we wouldn’t want computers to identify as significant.

Sure, there are ways to program and help a computer dictate with metadata what could be true/false. But don’t believe that these machines are learning all on their own, they need validation, which usually happens “off-line”, aka by humans (including Watson and every other piece of AI). That’s where jobs are created by artificial intelligence, as opposed to consuming the very jobs that people are concerned they’d be replacing.

Becoming “The Terminator”

The Terminator is a piece of American movie history that mystified us and continued to stretch our imagination. But it’s funny how what movie makers dream up, often become reality some years later.

And wearable technology, specifically Google GLASS could make The Terminator very close to our every day life. A cool, but slightly creepy (and possibly unethical) view of what it could be like is shown in the video below. As small, wearable technology becomes more powerful and accessible, this augmented reality may not just be a thing of the science fiction filmmaker.

Is what you saw ethical? From a current perspective, I would say absolutely not, and girls, get your pepper spray! But what if you opted into facial recognition? Say only certain pieces of software were licensed to grab pictures from your Facebook profile and you get to decide if the software can scour for your face? Then it doesn’t make it as unethical. I for one think the latter would happen and that this would really allow big data come to life for us on a personal scale.

Another aspect of robots and machines is that they can work/operate 24/7/365 (in theory). A Kickstarter campaign by a startup called NeuroOn is getting us humans closer to that reality. Watch the video, but if you’re too lazy, they’ve invented a sleeping mask that promotes strategic sleep, or in their words, polyphasic sleep (the practice of sleeping multiple times in a 24-hour period). Some of the greatest people in history practiced polyphasic sleep, for example: Napoleon, Churchill, de Vinci, and the list surprisingly goes on and on. So what this mask helps you do is switch from monophasic (what we do today) to polyphasic, using lots of sensors and artificial intelligence to optimize your switch and make it smooth, effective transition for you.

All of this then leading to you becoming the guy who works 20 hours a day! Not much research has been done on the health effects of polyphasic sleep, whether people who follow it get sicker less or more often, etc. etc.

Between augmented reality and being awake and effective for 20+ hours a day, you will soon be able to become The Terminator.

My Latest Stock Picks

Following up yesterday’s article on where I think the market is headed. Here are my current positions, followed by positions changed as of late.

Current Holdings:

– YHOO (@18.94/share on 11/28/2012) – Jumped on the Marissa Meyer bandwagon early – Price as of Friday 11/15 – $35.47

– HTGC (@10.58/share on 11/28/2012) – which has an +8% dividend yield – Price as of Friday 11/15 – $16.85

– TCPC (@14.95/share on 11/28/2012) – which has an +8% dividend yield – Price as of Friday 11/15 – $17.30

– DDD (@48.45/share on 8/23/2013) – Price as of Friday 11/15 – $80.17 – more on this one late

– JCI (@37.30/share on 5/17/2013) – Price as of Friday 11/15 – $49.45

– V (@182.00/share on 5/17/2013) – Price as of Friday 11/15 – $202.00

– GDXJ (@33.75/share on 6/27/2013) – Price as of Friday 11/15 – $35.98

– DTYS (@31.30/share on 5/17/2013) – Price as of Friday 11/15 – $29.41

Moves over the last few months

– Sold YUM on 10/10 for a 9% loss, and since then it is back up to my original purchase price of $74

– Sold LUV for a loss on 9/17, but up 28% since then (DOH!, but put that to work in DDD, which as been far more lucrative)

– Sold FB at $25 in June, now it’s at $50. Good news is I took the proceeds from that sale and put it in FB options, which I made 10x my money on. So this sounds like a poor sale, but if you’re bullish short-term, not long-term, buy options

– Sold ADT at $41.47, slight loss in June, and has hovered around $43 as of late

Biggest Industry I’m Bullish on 3D Printers. Here’s why:

Wall Street doesn’t fully understand this industry. And when they don’t understand and see the opportunity, that’s a huge opportunity for you as an investor. I think the message on Wall Street was “3D printers will never be able to replace manufacturers.” This is a true statement for the foreseeable future. But the opportunities that the industry is capitalizing on aren’t the mass production industries. They are things like organ regeneration using stem cells or easily replacing household items (focusing on having a 3D printer in every home, as evidenced by Windows 8.1 3D Builder). I think this is a long-term buy, with DDD, SSYS, and there are few health care focused companies as well. Health care is a focus of DDD, but not their only focus.