james22 Posted February 29 Share Posted February 29 22 minutes ago, Jaygo said: The working man better get ready to stand around and watch robots, maybe cigarettes will make a comeback just out of boredom. We could be in the midst of the first fear-based investment bubble in American history, with the masses buying in not out of avarice, but from a mentality of abject terror. Robots, software and automation, owned by Capital, are notching new victories over Labor at an ever accelerating rate. It’s gone parabolic in recent years – every industry, every region of the country, and all over the world. It’s thrilling to be a part of if you’re an owner of the robots, the software and the automation. If you’re a part of the capital side of that equation. If you’re on the other side, however – the losing side – it’s a horror movie in slow motion. The only way out? Invest in your own destruction. In this context, the FANG stocks are not a gimmick or a fad, they’re a f***ing life raft. Market commentators rhetorically ask aloud what multiple should investors pay to own the technology giants. That’s the wrong question when people feel like they’re drowning. What multiple would you pay to survive? Grab a raft. https://thereformedbroker.com/2017/10/16/just-own-the-damn-robots/ Link to comment Share on other sites More sharing options...
Jaygo Posted February 29 Share Posted February 29 10 minutes ago, james22 said: If you’re on the other side, however – the losing side – it’s a horror movie in slow motion. The only way out? Invest in your own destruction. In this context, the FANG stocks are not a gimmick or a fad, they’re a f***ing life raft. Market commentators rhetorically ask aloud what multiple should investors pay to own the technology giants. That’s the wrong question when people feel like they’re drowning. What multiple would you pay to survive? Grab a raft. https://thereformedbroker.com/2017/10/16/just-own-the-damn-robots/ This is basically Canadians and our housing market too. How many bought just to try and keep up. If your job is shit you have to find some other way to make money. Tough times Link to comment Share on other sites More sharing options...
Luke Posted February 29 Share Posted February 29 9 hours ago, james22 said: We could be in the midst of the first fear-based investment bubble in American history, with the masses buying in not out of avarice, but from a mentality of abject terror. Robots, software and automation, owned by Capital, are notching new victories over Labor at an ever accelerating rate. It’s gone parabolic in recent years – every industry, every region of the country, and all over the world. It’s thrilling to be a part of if you’re an owner of the robots, the software and the automation. If you’re a part of the capital side of that equation. If you’re on the other side, however – the losing side – it’s a horror movie in slow motion. The only way out? Invest in your own destruction. In this context, the FANG stocks are not a gimmick or a fad, they’re a f***ing life raft. Market commentators rhetorically ask aloud what multiple should investors pay to own the technology giants. That’s the wrong question when people feel like they’re drowning. What multiple would you pay to survive? Grab a raft. https://thereformedbroker.com/2017/10/16/just-own-the-damn-robots/ Why would only the FANG stocks be a fing life raft? Why should only "technology" thrive in a world of increased automatization? The technology has to be built with matter, steel etc. If the robots hypercharge GDP worldwide then 4x earnings miners will do well and probably even better than 35x technology companies. Link to comment Share on other sites More sharing options...
mattee2264 Posted February 29 Share Posted February 29 I can't imagine the average low skill white collar worker has much money to buy Mag7 stocks especially with the cost of living squeeze ongoing and wage increases nowhere near sufficient to compensate for all the post pandemic inflation and even less likely now that companies are planning to automate work and reduce headcount. And if a lot of low skills do lose their jobs they will probably end up liquidating their portfolio of Mag7 stocks they bought with their stimmy checks. Same way most people aren't buying BTC because of considered concerns about the explosion of the money supply post GFC and unsustainable path of US government debt. When inflation was in the double digits everyone was dumping bitcoin. To the extent people are buying perceived AI beneficiaries and bitcoin it is because people like to chase what is hot and going up. And this is especially true of retail investors who do not have the patience to hold something like Berkshire that will get you rich slowly compounding 10% a year like clockwork. The main fear that drives investors in a bull market is FOMO. And that is helping to drive up multiples. Case in point there is apparently a huge increase in custodial accounts being set up with brokerages that allow teenagers to buy stocks because they don't want to miss out on the action. But yeah there is a broader point here that capitalism is a bit broken when it is difficult to get ahead doing honest work with wages barely increasing in real terms prior to COVID and post COVID probably falling in real terms (who's had 20-30% wage increases over the past few years?) while anyone with a stock portfolio has been making double digit real returns over the last 15 years and anyone owning real estate has been building huge amounts of equity given their interest payments were next to nothing for much of the GFC period. Putting whatever meagre savings low skill workers have into Mag7 stocks which they will probably have to sell to feed their families when their jobs get automated and they become redundant isn't the solution. What we really need is to find a better way of taxing corporations and HNW individuals who will milk it if AI fulfils its promise so some of the wealth created can get redistributed via a universal basic income or at least generous benefits until a way can be found to repurpose low skill workers. Of course tech optimists talk about agriculture and industrialisation and de-industrialisation and say that new jobs will be created. But that ignores the issue of structural unemployment. Think about all the mining towns and factory towns that decades after de-industrialisation still have high unemployment rates? Link to comment Share on other sites More sharing options...
mattee2264 Posted February 29 Share Posted February 29 Luca is also right. If AI results in a productivity miracle it is going to be the users who benefit. The technology really isn't that proprietary. Lots of companies are coming out with LLMs including start ups no one has ever heard of. For now Nvidia has a technological lead in GPUs but it may not last and you are already paying a high price on the assumption it will. And while Big Tech have deep pockets that doesn't guarantee success and in recent years they've become better at monetization than ground breaking developments and the woke bureaucracy in these organizations is undermining trust and getting in the way of product development. Link to comment Share on other sites More sharing options...
Luke Posted February 29 Share Posted February 29 8 minutes ago, mattee2264 said: Luca is also right. If AI results in a productivity miracle it is going to be the users who benefit. The technology really isn't that proprietary. Lots of companies are coming out with LLMs including start ups no one has ever heard of. For now Nvidia has a technological lead in GPUs but it may not last and you are already paying a high price on the assumption it will. And while Big Tech have deep pockets that doesn't guarantee success and in recent years they've become better at monetization than ground breaking developments and the woke bureaucracy in these organizations is undermining trust and getting in the way of product development. If Ai results in a productivity miracle and a significant increase in automatization, the economy will need consumers who are able to buy the surplus of produced goods and services funneled by that growth. If the consumer is jobless and without money, nobody will buy the surplus and AI will not be implemented as much as the market hopes. So its a key question of how we can increase the consumers wealth while he is losing his job, higher taxation as @mattee2264 pointed out is the only way i see out of this scenario. In the end everybody would win in that case, we will have way more time, work less, have more products than we could imagine etc. But what are good assets to own in that case? With that turbocharge of growth we will likely also see a huge increase in competition in markets because monopolies wont help with growth, id not like to own the fabless chip producers for a 10 year period, i really cant say if the game will be the same as it is today. I think things like micron, tsmc, asml, railroads, amazon/ high capex infrastructure businesses will do very well in that case. Commodities might also do surprisingly well, who knows how less the cycles will there be if AI gets really implemented in business planning...especially considering the underinvestment and the following increase in demand...maybe with automatization and AI the economy will start to grow a lot more predictable with automatization. In any case, one would want to be an owner of high quality wide moat businesses most likely at reasonable prices, nothing changes here IMO Link to comment Share on other sites More sharing options...
Luke Posted February 29 Share Posted February 29 (edited) I wouldnt want to underestimate businesses that look like high margin businesses today could easily become low margin commodity businesses 15 years down in the future due to AI Real estate like ST.JOE could turn out super well in that case, luxury goods... Edited February 29 by Luca Link to comment Share on other sites More sharing options...
james22 Posted February 29 Share Posted February 29 1 hour ago, mattee2264 said: I can't imagine the average low skill white collar worker ... How about the "symbolic analysts"? The jobs that are coming under attack first are the jobs that up to now have resisted technological replacement. https://instapundit.substack.com/p/the-coming-symbolic-analyst-meltdown?sd=pf Link to comment Share on other sites More sharing options...
Gregmal Posted February 29 Share Posted February 29 2 hours ago, mattee2264 said: When inflation was in the double digits everyone was dumping bitcoin. So Bitcoin is obviously proven to be a bad inflation hedge…. Link to comment Share on other sites More sharing options...
gfp Posted February 29 Share Posted February 29 Are we gonna be OK? Should I be panicking because super-core ticked higher? Is capitalism working? Link to comment Share on other sites More sharing options...
ValueArb Posted February 29 Share Posted February 29 15 hours ago, Jaygo said: I think we are in the very early days of this. Candle wick straitening may be tough because of dexterity but the amount of real world productivity improvements are pretty vast. The loom was not perfect at first and the luddites made a mockery of it until the French loom arrived and they realized its efficiency so they tried to burn them down to save their jobs. Take a super rudimentary thing like splitting firewood. The average guy could split a face cord and feel good about himself in one or two hrs with already cut up trees. A super simple and very inexpensive firewood processer can cut to exact length and split about 3 cords or 15 times that amount each hour. so spend 6 grand and 15x your speed safer with better quality. Sure this example is really off the beaten path but if our entire ecosystem sees productivity improvements we will have a major jump in freed labour. Ive been researching building supply companies and the housing industry is ripe for robotics in the supply and finishing side. With Fanuc robotics and the touches of a Florida tech company Builders First Source is providing entirely pre-cut house framing packages that are accurate within 1/8 of an inch using nothing but robotic saws and the architectural drawings. This project is in its infancy and only available in Florida but they discuss it in their investor day so i'm thinking its working. Another one. The roadway reflective cats eyes are now starting to be installed at roughly 18 miles per hr by an automated epoxy and robotic stamp on a truck. This process takes roughly 2-3 hours per mile today with the most widely used practice. Our current way of doing most things is changing fast and smart machines combined with AI will be truly revolutionary. Now i'm pretty sure that the spoils of this is going to fall to corporate America and Capital in general. He who owns the machines... The working man better get ready to stand around and watch robots, maybe cigarettes will make a comeback just out of boredom. I'm not anti-automation, eliminating jobs through automation has been going on for thousands of years and why global standards of living have increased exponentially. I'm just uber skeptical of those who think we are going to build flexible general purpose robots (like Tesla optimus) any time soon (within the next two decades) that are cost effective and productive. Robots have been and will be specialized tools for doing very narrowly defined work tasks. AI will help make them more useful. The chief beneficiaries will be everyone. The "working man" will be doing less manual labor and more robot configuration, herding, maintenance and repair, and get paid more for doing so. Just like it's been throughout history. An example is auto production, where we produce far more sophisticated cars with a fraction of the man-hours than a hundred years ago. Robots are a part of that, but also just specialized tools and better production systems. The auto workers today make a vastly higher income than they did a hundred years ago, but we need far fewer of them to make even more cars. That freed up a huge amount of the workforce for other work and other industries, that also pay vastly more today than auto manufacturers did a hundred years ago. Its ironic that people think AI and robotics are going to lead to massive unemployment, when the process is already well underway and unemployment is lower than ever. Link to comment Share on other sites More sharing options...
ValueArb Posted February 29 Share Posted February 29 1 hour ago, gfp said: Are we gonna be OK? Should I be panicking because super-core ticked higher? Is capitalism working? All I see is "spacer.png" and a blue box with a question mark inside it? This is not the first time, why am I not seeing images in a lot of posts on this site any more? Link to comment Share on other sites More sharing options...
Hektor Posted February 29 Share Posted February 29 15 minutes ago, ValueArb said: I'm just uber skeptical of those who think we are going to build flexible general purpose robots (like Tesla optimus) any time soon (within the next two decades) that are cost effective and productive. Robots have been and will be specialized tools for doing very narrowly defined work tasks. AI will help make them more useful. The chief beneficiaries will be everyone. The "working man" will be doing less manual labor and more robot configuration, herding, maintenance and repair, and get paid more for doing so. Just like it's been throughout history. An example is auto production, where we produce far more sophisticated cars with a fraction of the man-hours than a hundred years ago. Robots are a part of that, but also just specialized tools and better production systems. The auto workers today make a vastly higher income than they did a hundred years ago, but we need far fewer of them to make even more cars. That freed up a huge amount of the workforce for other work and other industries, that also pay vastly more today than auto manufacturers did a hundred years ago. Its ironic that people think AI and robotics are going to lead to massive unemployment, when the process is already well underway and unemployment is lower than ever. Link to comment Share on other sites More sharing options...
Jaygo Posted February 29 Share Posted February 29 4 minutes ago, ValueArb said: I'm not anti-automation, eliminating jobs through automation has been going on for thousands of years and why global standards of living have increased exponentially. I'm just uber skeptical of those who think we are going to build flexible general purpose robots (like Tesla optimus) any time soon (within the next two decades) that are cost effective and productive. Robots have been and will be specialized tools for doing very narrowly defined work tasks. AI will help make them more useful. The chief beneficiaries will be everyone. The "working man" will be doing less manual labor and more robot configuration, herding, maintenance and repair, and get paid more for doing so. Just like it's been throughout history. An example is auto production, where we produce far more sophisticated cars with a fraction of the man-hours than a hundred years ago. Robots are a part of that, but also just specialized tools and better production systems. The auto workers today make a vastly higher income than they did a hundred years ago, but we need far fewer of them to make even more cars. That freed up a huge amount of the workforce for other work and other industries, that also pay vastly more today than auto manufacturers did a hundred years ago. Its ironic that people think AI and robotics are going to lead to massive unemployment, when the process is already well underway and unemployment is lower than ever. I totally agree. I dont expect tons of unemployment just changes in employment, probably a lot more standing around. I do expect that Capital will do very well as the owners of the machines and tech. I think the working man will feel hard done by because there will be considerable shifts in labour and they may struggle to keep up. Long term we will all benefit and our living standards are likely to be improved but as you should well know we dont see our lives getting better or worse, what we do is compare what we have to our contemporaries. I am richer than Jacob the rich of the 15th century because of advancements I had no part in but i'm poorer than Jeff Bezos therefor i'm am relatively poor. This relative lifestyle vs the owners of Capital is likely to widen even if everyone's lifestyle actually improves. Link to comment Share on other sites More sharing options...
ValueArb Posted February 29 Share Posted February 29 2 minutes ago, Jaygo said: I think the working man will feel hard done by because there will be considerable shifts in labour and they may struggle to keep up. Long term we will all benefit and our living standards are likely to be improved but as you should well know we dont see our lives getting better or worse, what we do is compare what we have to our contemporaries. I am richer than Jacob the rich of the 15th century because of advancements I had no part in but i'm poorer than Jeff Bezos therefor i'm am relatively poor. This relative lifestyle vs the owners of Capital is likely to widen even if everyone's lifestyle actually improves. The inequitable distribution of wealth will only become acceptable when every working man can afford to buy their girlfriends a set of fake cans as big as Bezo's girlfriend has. Link to comment Share on other sites More sharing options...
Luke Posted February 29 Share Posted February 29 24 minutes ago, ValueArb said: That freed up a huge amount of the workforce for other work and other industries, that also pay vastly more today than auto manufacturers did a hundred years ago. Its ironic that people think AI and robotics are going to lead to massive unemployment, when the process is already well underway and unemployment is lower than ever. Id go so far and say that the average service worker joe is not better off today in terms of wealth than a factory worker 60 years ago, yes he will live longer, can use more technology etc but uber drivers are broke and dont make any money. On top comes that these companies try everything to pay them as little as they can, part of the business model. Wealth increases for qualified earners but those will become fewer with automatization, many more will drop into services and we can all see that the delivery drivers, nail salon polishers whatnot are not getting wealthier. Unemployment will increase if even service sector can use automatization (automated delivery drivers etc), i dont think its plausible to argue that increase of automatization and AI will NOT lead to less jobs in total. Link to comment Share on other sites More sharing options...
Hektor Posted February 29 Share Posted February 29 11 minutes ago, Jaygo said: I think the working man will feel hard done by because there will be considerable shifts in labour and they may struggle to keep up. AI could displace the white collar/knowledge worker too. Probably more than the working man. I guess most of these are not imminent and are a long way off. Link to comment Share on other sites More sharing options...
Jaygo Posted February 29 Share Posted February 29 ^^^ Ah yes, the true measure of wealth. Link to comment Share on other sites More sharing options...
Luke Posted February 29 Share Posted February 29 11 minutes ago, Jaygo said: Long term we will all benefit and our living standards are likely to be improved but as you should well know we dont see our lives getting better or worse, what we do is compare what we have to our contemporaries. I am richer than Jacob the rich of the 15th century because of advancements I had no part in but i'm poorer than Jeff Bezos therefor i'm am relatively poor. This relative lifestyle vs the owners of Capital is likely to widen even if everyone's lifestyle actually improves. Bottom 50% percentile wages have not risen at all for 15 years+, not "everyone" is getting richer. Considering inflation its more like more than half is not seeing more wealth but less, hence the political instability worldwide. Link to comment Share on other sites More sharing options...
Luke Posted February 29 Share Posted February 29 Just now, Jaygo said: ^^^ Ah yes, the true measure of wealth. Of course it depends on what your definition of wealth is, if you look at asset ownership many people can not afford homes and lifestyles their parents were able to afford. Link to comment Share on other sites More sharing options...
Jaygo Posted February 29 Share Posted February 29 Just now, Luca said: Of course it depends on what your definition of wealth is, if you look at asset ownership many people can not afford homes and lifestyles their parents were able to afford. I was replying to ValueArbs comment of Bezos girlfriend. I referring to breast size of wives or girlfriends as the true measure of wealth but i'm immature, sorry. 1 Link to comment Share on other sites More sharing options...
Cigarbutt Posted February 29 Share Posted February 29 1 hour ago, gfp said: Are we gonna be OK? Should I be panicking because super-core ticked higher? Is capitalism working? To the question "Is capitalism working?" who knows. i'd say it'll be fine. (may have some bumps along the way?) Similar picture: The 'market' had it right? Too early can be seen as wrong though? ----- As far as the forces outside of capitalism, forces trying to modulate it (for better or for worse), there has got to be a link with recent excess money creation at large, accepting the possibility of lag events, confusing what transitory means? Link to comment Share on other sites More sharing options...
gfp Posted February 29 Share Posted February 29 @Cigarbutt In the middle charts, "money growth and inflation," what are they plotting as "money growth?" It looks like the red line is "inflation." How are they defining "money growth?" Link to comment Share on other sites More sharing options...
Castanza Posted February 29 Share Posted February 29 Lots of red tape around AI implementation in "knowledge" industries. Example: ASTM currently prohibits all use of AI in any capacity. So anyone who creates reports, or utilizes these standards also cannot utilize AI. I imagine other industry standards are similar (accounting, law, medicine, etc.) but not sure. Artificial Intelligence Policy: ASTM International prohibits the entry of ASTM standards and related ASTM intellectual property (“ASTM IP”) into any form of Artificial Intelligence (AI) tools, such as ChatGPT. Additionally, creating derivatives of ASTM IP using AI is also prohibited without express written permission from ASTM’s President. In the case of such use, ASTM will suspend a licensee’s access to ASTM IP, and further legal action will be considered. Link to comment Share on other sites More sharing options...
Cigarbutt Posted February 29 Share Posted February 29 19 minutes ago, gfp said: @Cigarbutt In the middle charts, "money growth and inflation," what are they plotting as "money growth?" It looks like the red line is "inflation." How are they defining "money growth?" First apologies. These 'money' questions are incredibly interesting but is it worthwhile to discuss? For entertainment value only then The ivory tower experts define excess money growth as excess broad money measures growth over GDP growth. Similar to: Link to comment Share on other sites More sharing options...
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