Business

  • GPT-3: Boom or Bust?

    GPT-3 was released by OpenAI in 2020 – and was considered by many a huge jump in natural language processing. 

    GPT stands for Generative Pre-trained Transformer. It uses deep learning to generate text responses based on an input text. Even more simply, it's a bot that creates a quality of text so high that it can be difficult to tell whether it's written by a human or an AI.

    GPT-3 is 100x bigger than any previous language AI model and comes pre-trained on 45TB of training text (499 billion words). It cost at least 4.6 million US dollars (some estimated as high as $12 million) to train on GPUs. The resulting model has 175 billion parameters. On top of that, it can be tuned to your specific use after the fact. 

    1_C-KNWQC_wXh-Q2wc6VPK1gvia Towards Data Science

    Here are some interesting GPT-3 based tools: 

    • Frase – AI-Curated SEO Content 
    • Emerson – AI Chatbot
    • Viable – Customer Feedback Analytics Platform
    • Sapling– Customer Service

    Practically, GPT-3 was a huge milestone. It represents a huge jump in NLP's capabilities and a massive increase in scale. That being said, there was a frenzy in the community that may not match the results. To the general public, it felt like a discontinuity; like a big jump toward general intelligence.  

    To me, and to others I know in the space, GPT-3 represents a preview of what's to come. It's a reminder that Artificial General Intelligence (AGI) is coming and that we need to be thinking about the rules of engagement and ethics of AI before we get there. 

    Especially with Musk unveiling his intention to build 'friendly' robots this week. 

    On the scale of AI's potential, GPT-3 was a relatively small step. It's profoundly intelligent in many ways – but it's also inconsistent and not cognitively concrete enough.

    Take it from me, the fact that an algorithm can do something amazing isn't surprising to me anymore … but neither is the fact that an amazing algorithm can do stupid things more often than you'd suspect.  It is all part of the promise and the peril of exponential technologies.

    It's hard to measure the intelligence of tools like this because metrics like IQ don't work.  Really it comes down to utility.  Does it help you do things more efficiently, more effectively, or with more certainty? 

    For the most part, these tools are early. They show great promise, and they do a small subset set of things surprisingly well. If I think about them simply as a tool, a backstop, or a catalyst to get me moving when I'm stuck … the current set of tools is exciting.  On the other hand, if you compare current tools to your fantasy of artificial general intelligence, there are a lot of things to be improved upon. 

    Clearly, we are making progress. Soon, GPT-4 will take us further. In the meantime, enjoy the progress and imagine what you will do with the capabilities, prototypes, products, and platforms you predict will exist for you soon.

    Onwards. 

  • Camp Kotok 2021

    Each year I look forward to Camp Kotok, or as I like to call it Economists in Nature. It's basically 5 days of canoeing, fishing, and dining with economists, wealth managers, traders, investors and more. 

    One of few chances for people from these backgrounds to come together and talk about the world, big trends, investing, economics, politics, and more … in an open and safe forum. The event goes by the Chatham House Rule – which basically means you can share the information you receive, but not who said it. 

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    This year we talked about everything from China, digital currencies, the pandemic, and the state of markets. 

    Interestingly, for all the takeaways I could focus on, the main takeaway was uncertainty. 

    For all the intelligent and "in-the-know" people in the room, very few people had clear opinions of what was going to happen. There were too many variables at play, and while they posited a lot of potential paths, it feels like the general census was we're at a crossroads with many potential futures in front of us. 

    Despite the general uncertainty in the room, it wasn't fear-laden. The general mood was optimistic, and for the most part, everyone sees paths toward economic success post-COVID.

    With that said, when and what "post-COVID" means is another issue.

    One of the other key discussions that came up often was the new generation of workers and their changing relationship with work. It's plain to see the rate of quitting is higher, that wages are rising, and it's getting hard to fill minimum wage jobs. It's hard to get employees back in an office space, and many are willing to take pay cuts or switch to other companies to stay at home. 

    The long-term impact on our economy (and our culture) is yet to be seen.

    We live in interesting times. 

    As a bonus, here's an interview I shot at Camp Kotok in 2018 with Bob Eisenbeis,  Cumberland Advisors' Vice Chairman & Chief Monetary Economist.  Check it out.  

     

    Cumberland Advisors via YouTube

  • What Technologies Are Going To Most Impact The Next 5-10 Years?

    At a mastermind meeting last week, Landon Downs from 1Qbit spoke on the state of technology.  Landon and I agree on a lot of things – and one of those things he emphasized heavily.  AI is in a period of massive innovation. It's a renaissance, or springtime, or whatever euphemism you want to use. But it's only springtime for AI if you can take advantage of it.

    Adding to that, he explained that a current constraint might become a big short-term limitation to how widespread AI can grow. The constraint is that there is a global chip shortage (and it could be an issue until 2023).

    The chip shortage is probably a bigger problem than you imagine because microchips are in everything from refrigerators to toothbrushes – not just high-tech computers. This has the potential to be a massive disruptor, especially in the tech industry. 

    Pink and Purple Sporty Gradient Fitness YouTube Thumbnail (1)

    Building and running smart AI systems takes a lot of computing power, and as more competitors enter the scene, not only will the cost to play increase, but so will the potential you get turned away at the door. 

    To a certain extent, the AI arms race becomes a chip arms race. 

    As I thought about the chip shortage, and its impact on the next few years, it also made me brainstorm what else I thought would be the most influential shifts that would influence me and my business (and potentially the world). 

    Here's my top 5, and I'd love to hear yours. 

    1. Compute Power is going to increase, and the ability to brute force problems will create new possibilities. Quantum computing will become more important and likely available for commercial use. 
    2. New and better AI platforms will transition AI from a tool for specialists to a commodity for everyday people – it won't just be Artificial Intelligence, it will be Amplified Intelligence (helping people make better decisions, take smarter actions, and continually measure and improve performance). 
    3. Blockchain and authenticated provenance are going to become more important as the world becomes increasingly digital. Trust and transparency will be important as indelible logs are needed for finance, medical, armies, etc.
    4. IoT will become more pervasive, enabling near digital omniscience as everything becomes a sensor that transmits data up the chain. 
    5. Mass customization will become the norm instead of simple mass production as hardware, data, and AI continues to improve products, medicine, custom supplements, and just about everything else. 

     

    What do you think?  I'd love to hear your list.

  • Elon Musk and His Self Driving Cars

    While self-driving cars seem like a relatively new invention, the reality is that the earliest autonomous self-driving cars existed in the early 1980s (non-autonomous versions and semi-workable experiments have existed since the 1920s). 

    Luckily, the standards and approach have gotten much better since then, and we continue to make massive strides. Recently, Elon Musk stated that he was confident that level 5 self-driving cars would exist by the end of this year. That would mean the need for a steering wheel or a driver's seat would be next to 0 – a luxury even. 

     

    Autonomous-self-driving-cars-vs-human-drivers-chart

    via Stein Law

    According to many AI experts, this is exciting because level 5 autonomy is not just difficult – it's near impossible. 

    Think of it from a human perspective. When we're driving, many minute decisions happen instantaneously and without much trouble. But some of those decisions are "subjective" and seemingly novel. We know the answer because we intuit the answer – not because it's following any specific rule. 

    For a car to reach level 5 autonomy, it would have to be pre-trained for essentially every possible situation they could encounter – no matter how rare. 

    Elon Musk is famous for his potentially antagonizing beliefs and predilection for extreme statements … but will Tesla somehow solve these problems?

    Is AI about to pass another hurdle already?

    It's exciting stuff! As someone that hates long drives, I'm certainly ready for it. I can also envision a future where the norm is autonomous driving, and individuals that want the right to drive their cars themselves will have to pass extra tests, pay extra fees, and warn the autonomous cars that it's a human at the wheel. 

  • The History of Innovation Cycles

    In today's environment of rapid change, innovation is a topic worthy of increased thought, action, and discussion

    Here are some articles worth a look to get started:

    Too often, people view Innovation through the lens of today (meaning, they evaluate where things are in relation to their hype cycle or adoption model. While helpful, these methods focus on shorter-term trends.  Sometimes, a longer view helps too. 

    Let's look at the pace of innovation, and how the long waves of innovation are truncating faster. 

     

    Innovation_Cycles-2via Visual Capitalist

    The theory behind these long waves of innovation is based on creative destruction. To summarize a complex theory, as markets are disrupted, a few key clusters of industries have a major effect on the economy and the future structure of society.

    An easy-to-understand example is that as railways proliferated, urban growth happened around stations. To a lesser extent, it happened with aviation as well.

    The most recent example would be the transition of businesses online. I think it's likely that the COVID pandemic moved forward the timeline for the 6th wave considerably, as individuals get used to a new normal. 

    Despite the pain and challenges of new technologies, each of these waves brought economic growth and improved living standards. 

    ESG and green tech are becoming more important (and, perhaps, a driver of the 6th wave).  Nonetheless, I think the major movers will be AI and the decreasing divide between digital and physical.

    In many respects, I believe AI will terraform the world similarly to how electricity (or the Internet) did – but in much less time. 

    What do you think? 

  • Speaking At The 13th Annual Rocky Mountain Economic Summit

    The Rocky Mountain Economic Summit is one of my favorite events to attend each year.  It is hosted by the Global Interdependence Center and the Bronze Buffalo Club just outside Jackson Hole, Wyoming. 

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    Major media outlets like Bloomberg, Forbes, and Reuters cover the event live.

    This year, some of the key speakers included Paul Ryan, Megan Greene, David Kotok, John Silvia, and Paul McCulley. 

    I had the pleasure of speaking during their session on Cybersecurity and AI. The Global Interdependence Center also recorded our session, so I'm thankful to share it with you here. Let me know what you think. 

     

    The mood was pretty optimistic and bullish. As you might expect, there was a growing interest in crypto and blockchain … and a growing sense of “us versus them” directed at China and Russia. We live in interesting times!

    If you want to download my presentation slides, you can do that here. 

  • Tracking Ransomware Attacks

    At the beginning of July, a ransomware attack on IT management company Kaseya's VSA systems by REvil, became big news after influencing over 1500 companies and millions of devices. 

    It took 19 days before they had a solution that they received from a "trusted third party." It's believed that Kaseya got the decryptor either from paying the ransom or from the US or Russian governments. 

    Unfortunately, ransomware attacks are becoming more common. To see more data on various known attacks, Information is Beautiful put together a great interactive visualization. 

    Screen Shot 2021-07-25 at 3.06.21 PMvia Information Is Beautiful

    It's impossible to protect yourself completely, but there are a lot of simple things you can likely be doing better. 

    • Use better passwords… Even better, don't even know them.  You can't disclose what you don't know.  Consequently, I recommend a password manager like LastPass or 1Password who can also suggest complex passwords for you. 
    • Keep all of your software up to date (to avoid extra vulnerabilities)
    • Don't use public wifi if you can help it (and use a VPN if you can't)
    • Have a firewall on your computer and a backup of all your important data
    • Never share your personal information on an e-mail or a call that you did not initiate – if they legitimately need your information, you can call them back
    • Don't trust strangers on the internet (no, a Nigerian Prince does not want to send you money)
    • Hire a third-party security company like eSentire or Pegasus Technology Solutions to help monitor and protect your corporate systems

    How many cybersecurity measures you take comes down to two simple questions … First, how much pain and hassle are you willing to deal with to protect your data? And, second, how much pain is a hacker willing to go through to get to your data?

  • World Happiness Levels in 2021

    Happiness is a complex concept comprised of positive emotions, lack of negative emotions, comfort, freedom, wealth, and more. 

    Regardless of how hard it is to quantify … humans strive for it.

    Likewise, it is hard to imagine a well-balanced and objective "Happiness Report" because so much of the data required to compile it seems subjective and requires self-reporting. 

    Nonetheless, the World Happiness Report does a good job with its annual look at quantifiable factors (like health, wealth, GDP, and life expectancy) and more intangible factors (like social support, generosity, emotions, and perceptions of local government and businesses).  Click the image below to view the Report.

    V2Screen Shot 2021-07-23 at 2.48.08 PMvia World Health Report

    In their 2021 report, there was a significant focus on the effect of COVID-19 on happiness levels and mental health. 

    As you might expect, the pandemic caused a significant increase in negative emotions reported. Specifically, there was a significant increase in reports of worry and sadness across the ninety-five countries surveyed. Moreover, the decline in mental health was higher in groups that already had mental health problems – women, young people, and poorer people. 

    What's interesting about this is the resilience and bounce-back seen within the data. Considering the amount of disruption to households this past year, it's remarkable how stable the averages for countries have been. 

    Ultimately, globally, humans persevered in the face of economic insecurity, anxiety, and challenges to mental and physical health. 

    Despite the changes in emotions in 2020, overall life satisfaction rebounded quickly after March of 2020. 

    Global-Happiness-Levels-2021-Main-Graphicvia Visual Capitalist

    While there was a decrease in overall happiness, the relative balance in the face of such adversity may point towards the existence of a hedonic treadmill – or set point of happiness. I'm always impressed by what people can get used to, and how you can find pockets of joy in even the hardest times … or how people with everything they could ever ask for can still feel profound unhappiness. 

    It's oddly beautiful and a great reminder that happiness comes from within. Obviously, our environment and circumstances play a part. It's easier to be content with a roof over your head and a stable job. But, after a certain point, it's on us to create our realities. 

    Onwards!

  • What Comes Next With Sébastien Toutant

    The opening ceremonies for the Tokyo Olympics started on Friday. 

    While the Olympics are more controversial this year than normal, I think most of us can appreciate watching the best athletes performing at their peak. We can also laugh at the cardboard "anti-sex" beds they put in the Olympic Village.

    With that, I thought I'd bring back a video I shot with Sébastien Toutant who won a gold medal at the most recent winter Olympics. I met Sébastien while leaving an F1 race in Montréal. I had a chance to talk to him about what makes him tick and where he sees his future.

    It's a great case study in self-actualization after you've reached the top of your proverbial mountain top. 

    There are multiple factors at work in high performance and in keeping yourself passionate and motivated. 

    1. Find Your Unique Ability

    "Snowboarding is my passion. I was doing it every day … Over time, It's my job, but it's still my passion. Every time I strap in on my board, I love it. You have to balance it. You have to keep the fun alive." 

    Unique Ability is where there's superior skill and it gives you energy, instead of taking energy. When you have to grind every day to become the best, and it's taking energy away from you, you're not going to stick with it. 

    When it lights you up, there's no limit to the hours or years you can commit to it. 

    2. Maintain Good Habits and Build New Skills 

    "Keep Snowboarding. Keep Training. Keep Trying New Tricks.  The sport is moving so much, so you always have to improve your riding and invent new tricks. Push the sport to the next level." 

    Success is a war of attrition. You gain it every day through consistent habits and hard work. It's easy to talk the talk, but it's harder to set yourself up for success. Structure your life, and your environment in a way that makes success the default.

    3. Stay Focused on the Future

    "You have to make sacrifices to make it there. But it's worth it."

    At my office, we practice the idea of "Measure Backwards, Plan Forwards". 

    To us that means it's important to take time to appreciate how far you've come … yet, it's also important to stay focused on what you can still accomplish. 

    Your edge is decaying faster than ever before. Competition is growing not just from your competitors but from technology as well.  Stay focused on next. 

    By the way, there is one other lesson this encounter reminded me about – opportunity is all around you … waiting for you to notice and act!  It would have been easy for me to filter out the "kid" standing behind me in a line after an event.  Luck favors the prepared.  Stay focused on what you want and keep your eyes, ears, and mind open for ways to get it!

    Onwards!

  • Mindset Matters – When the Revolution Comes Knocking

    Last week, we talked about the future of AI and the potential for AI to start taking over some jobs (freeing humans to raise their chins and do something better and more meaningful).

    One of the key factors I talked about was "mindset." For example, consider whether you’re in a scarcity or abundance mindset? If you are in a scarcity mindset, that probably means you see life as a finite pie with only so many slices … and if someone else gets a big slice (or something new interrupts you getting your slice), you worry that you might not get what you deserve.  On the other hand, an abundance mindset recognizes that there’s plenty out there for everybody, and if there’s no more pie, we can always create new pies (or something better).

    I have a picture in my conference room that says energy might be the most important thing to measure.

    Energy Might Be The Most Important Thing To Measure_GapingVoid

    via GapingVoid

    Yes, it means what it sounds like – but, for us, it also means more. 

    We use A.I. to trade.  So, measuring performance is important.  But so are all sorts of production, efficiency, and effectiveness measures. 

    There are hundreds of important metrics we track day-to-day.  Energy impacts many of them (and absolutely affects your ability to respond to change). 

    Energy affects how you feel, what you do, and what you make things mean.  Consequently, energy is an effective way to measure your values too.

    We’ve seen numerous inflection points in the past with the introduction of electricity, and then the assembly line and the industrial revolution, with the internet, and now with AI.

    There’s always disruption, and there’s always pain, but your mindset and energy can radically change what that means to you … and what you choose to do.

    AI is coming.  Disruption is coming!  It's no longer simply possible; it's not even just probable; it is inevitable.   With that said, what you make it mean and how you respond is up to you.

    In a prior post, I shared a mindset scorecard I created at Genius Network.

    Normally, Genius Network is private, and these recordings are for internal use only; but I asked permission to share my impromptu session with you. 

    Check it out. In the first 5 minutes, I introduce the scorecard concept. For the next 10 minutes, you'll get an extra look at the resulting group discussion. 

     

    Think of each comparison as a spectrum. They're not necessarily "one-or-the-other," but they can help identify where you are on the scale of "what to avoid" versus "what you want."

    • Blaming <—–> Encouraging
    • Insistent <—–> Inspirational
    • Fearful <—–> Abundant
    • Steadfast <—–> Curious
    • Clogging <—–> Cleansing
    • Resentful <—–> Grateful
    • Zero-Sum <—–> Relational
    • Small-Minded <—–> Visionary

    These words mean something to me, but they may need tooling to work for you. Changing the names, the order of the comparisons, the number of comparisons, etc., can have a profound effect on the usefulness of this scorecard to you. 

    I encourage you to think about how you could use this scorecard and how you can bring attention to those people and actions that best embody the traits that are important to you or your business.

    Identifying the words you want to embody and the person you want to be can help make you responsive to change and a better version of yourself.

    Hope that helps.