The “thinking machine” will change everything… How to profit as this mega trend plays out… In the mailbag: “The American dream is still here”…
Yesterday, we showed you why the “thinking machine” – aka artificial intelligence (AI) – is the most disruptive technology of our age.
Over the next decade or so, advances in AI will bring such fundamental changes to our lives they’ll dwarf all the technological progress we’ve seen in our lifetimes.
And in today’s dispatch, we’ll reveal how you can profit in your portfolio as the AI mega trend plays out.
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So, as AIs get more and more powerful, we’ll see a quantum leap in technological progress unlike anything we’ve seen before.
AIs excel at crunching through vast amounts of data to figure out patterns that predict certain outcomes. This gives them a superhuman ability to solve the problems humans struggle with.
For instance, an AI could help us figure out how to create nuclear fusion. This would give us an unlimited zero-carbon, non-combustion energy source… and radically transform the energy industry.
An AI could also help us feed the world’s growing population. From detecting pests on crops… to figuring out what crops will deliver the best yields… to predicting the exact moment of ripeness for fruits and vegetables… AI algorithms are also going to change farming for good.
AIs will also be able to help improve schooling. For instance, they’ll be able to do the tedious task of grading, freeing up human teachers to spend more time with students.
And they’ll help with individualized learning, too. Not everyone learns in the same way… or at the same pace. AI “teachers” will be able to customize lessons to suit individual students’ needs.
These days, corporate executives and other wealthy individuals have human personal assistants who manage their daily schedules… arrange their travel… and keep track of expenses.
But in the near future, an AI assistant will do those tasks. And it won’t just be for the elites. Everyday consumers will have access to an AI assistant… just like we have access to more basic digital assistants such as Apple’s Siri or Amazon’s Alexa today.
Here’s Jeff Brown, our tech expert here at Legacy Research, with more…
I imagine a world where we can use a chat window on our phone, laptop, or desktop to talk to a seemingly “real” person at the other end of the line – but with a near-limitless ability to help answer questions and assist with daily tasks.
I can’t wait for this. All of the tasks that consume so much of our time – making an appointment, disputing a health insurance claim, finding a receipt, replying to an e-mail, ordering groceries, looking up a schedule – will all be at our fingertips with the help of a personalized digital assistant: an AI.
We’re just at the beginning of this trend toward AI digital assistants. But if you have young kids… or grandkids… they’ll likely one day ask you how you ever got by without your AI assistant organizing your life and doing the tasks you’d prefer not to do.
(Think how younger folks today marvel at how older people ever managed without having a smartphone always at hand.)
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But they can do a pretty good job, as this demonstration of Google’s AI personal assistant – called Duplex – shows.
Duplex, Google’s rival to Amazon’s Alexa, was able to book a simple hair appointment over the phone. (Make sure you watch the short video clip at the link above to see how eerily human Duplex is.)
But Duplex still can’t pass for a human if the conversation covers a wide range of topics. So if the person on the other end of the line had broken down in tears and started talking about her dying mother, the Google AI wouldn’t have fared so well.
But Jeff isn’t interested in the world as it is today. He’s interested in what the near future will be like based on tech trends that are already in motion.
And he says that, by 2026, talking with an AI assistant will be indistinguishable from talking with another human.
As regular readers know, Jeff is one of the most knowledgeable guys on tech in the world today. For my money, he’s also one of the world’s best tech communicators.
I’ve learned a ton about the self-driving revolution from reading Jeff’s research reports. I’ve also learned about the rollout of 5G… and the disease-curing potential of genetic editing technology.
It’s why Jeff is also in demand as a tech advisor and consultant.
He was recently in D.C. to talk to a group of U.S. senators about blockchains – the cryptographic technology behind Bitcoin and other cryptos. The group wanted to know how blockchains can be used to give the U.S. a competitive advantage over its economic rivals.
And when I spoke with Jeff earlier this week, he’d just returned from a U.S.-certified trade mission to Israel. He spent three full days in meetings in Jerusalem and Tel Aviv… with policy makers, diplomats, established tech projects, and early-stage companies.
The head of the Central Bank of Israel was also in the meetings. And Jeff even got an invite to dine with the U.S. ambassador to Israel at his residence outside of Tel Aviv, on a property overlooking the Mediterranean.
And what he said about the rate of growth in this sector blew me away. Jeff again…
I had an epiphany about AI at an obscure technology conference a couple of years back. I was in the room in a session with about 200 techies who were all working on AI. The presenter was talking about how much promise the technology had. But he said it was frustrating work because the technology was moving forward so slowly.
He said AI algorithms were improving at a rate of “only” 5% to 7% a month. The other folks in the room were thinking about how slow, incremental, and painstaking their work was. But I had only one thought in my head – exponential growth.
Exponential growth works like compounding does in the investing world. If an AI is improving at a rate of 5% a month, where will it be 12 months from now? Answer: 79% better than a year ago. What about two years from now? Answer: 222% better. And in three years, it will be 479% better.
That’s the kind of mega trend that gushes profits for decades… If you know how to capture its potential.
Jeff’s favorite way to profit as AIs get exponentially more advanced is to buy shares in what he calls the workhorses of the AI revolution – the AI chipmakers.
Without getting too far into the weeds, AIs don’t run on the kind of central processing unit (CPU) that runs your PC, laptop, tablet, or smartphone.
They run more efficiently on more specialized hardware, such as the graphics processing units (GPUs) that typically run gaming consoles.
In fact, GPUs are central to the AI revolution. They can perform millions of operations, in parallel, at the same time, which is crucial for AIs.
Jeff again…
This unassuming piece of hardware will unlock the biggest technology trend of 2019… and possibly our lifetimes – pervasive artificial intelligence.
The market for AI software is set to hit $78 billion by 2025. That’s 28 times larger in just seven years. That’s impressive.
But the market for AI chipsets (semiconductors) is even more impressive. Just $1.6 billion in 2017, current forecasts are for $66 billion by 2025. This is more than 40 times higher than where we were in 2017. That implies even more accelerated growth than AI software during the same timeframe.
One of Jeff’s favorite ways to play this is with chipmaker Advanced Micro Devices (AMD).
AMD is focused on the high-performance computing markets. More important, it has become one of only two dominant suppliers of GPUs in the world. And since Jeff added it to the model portfolio at our Near Future Report advisory in November 2017, it’s up 150%.
The importance of its GPUs to the AI revolution is one of the reasons AMD has run up so much since Jeff recommended it.
At writing, AMD shares are above Jeff’s buy-up-to price of $25. So you should wait for a dip below that level to buy in.
In fact, he believes they could deliver gains of 1,000% or more in the coming years.
Jeff will be sharing details in a new video presentation he’s put together… along with a three-part strategy he calls “Brown’s Rule.”
Jeff uses this strategy to pinpoint the AI companies on the verge of exponential growth. And as you’ll see, it allows him to find these early-stage plays with a 95.3% success rate…
You can watch Jeff’s video – and learn how to access the three names he recommends – right here.
On Monday, in the ongoing debate over capitalism vs. socialism, reader Cesar L. said…
For far too long, our capitalism rewards those who are already rich and powerful. The rest of America survives on scraps…
Socialism makes sure that everybody benefits from the country’s wealth. That is why it is attractive to the young people who look at the horizon and see only a future that will not make them more progressive than their parents, but less.
A future that promises the best part of the American dream – owning your own home – will be out of reach for them until well into middle age. Or perhaps, never.
But not everyone agrees with Cesar…
First off, we aren’t living in a capitalist system. At best, it’s a crony-capitalist system. What we have is a mixed capitalist/socialist system. I think for those of us in smaller business, we are in a capitalist system, until we try to take on the bigger businesses. These businesses use their power and influence to keep us at a manageable size (crony-capitalism). Then, there are industries that are heavily subsidized (i.e., farming, wind, solar, etc.), that I see as almost socialist.
Socialism has failed every time it has been tried. Capitalism (not crony-capitalism) has brought us much prosperity and dragged more people out of poverty than any other system. I say more freedom is what we need, smaller government, less cronyism.
– Mike A.
I have to disagree with anyone who thinks the American dream (owning your own home) is out of reach, or a long way off. Those who cannot afford to buy a house at a younger age brought it on themselves by taking on so much debt earlier in their life and ruining their credit (student loans, nice car, credit card irresponsibility, etc.).
I am at the age of most college graduates, but I got a job instead of going to college and now, I am making more than most college grads, with no student debt. I bought my house three years ago. I own several vehicles and only pay on one. No one handed me these things. I worked to prove my value and negotiated my pay. I am not rich by any stretch. I made a budget and stuck to it. Lucky? No! Hard work!
Incorporating more socialism into society will only make it more difficult for me and others like me to survive. Socialism only makes more people need/want more socialism. If someone wants a better life, go out and make it better for yourself. Don’t expect the government or society to make it better for you.
The American dream is still here. I’m living it. You can earn it, too. There will be no American dream when people no longer have to work for what they get.
– Steve K.
What he refers to as capitalism is not capitalism in its original state and intentions. People like him want to give capitalism a bad rap because it has been distorted by the Fed and most other government interventions.
People like him seem to think that expanded government regulation is capitalism! Thomas Jefferson or Ronald Reagan would not call what we have become today capitalism. I do not think Cesar L. knows what “The government that governs least, governs best” means.
– Thomas M.
Can socialism help people reach the American dream, as Cesar L. says? Or do you agree with Thomas M. that the government that governs least, governs best? Write us at [email protected].
Until tomorrow…
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Chris Lowe
April 10, 2019
London, England
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Fair warning, this opportunity isn’t for everyone. If you can’t handle big price spikes overnight, maybe sit this one out. But if you’re prepared to take on some risk to potentially make a small fortune, watch this…
