AI working for the people or against the people

AI and technology can be used for good or bad. Currently some AI use cases involve monitoring the population and invading privacy. For example, look at this glimpse into China’s social credit system, an Orwellian nightmare:

Another big use case is addicting people to their devices through design to sell more advertising and capture their valuable attention (what Albert Wenger calls the new scarcity). We’ve posted links to podcasts by Tristan Harris before talking about the arms race in technology to capture your attention. This slide from the Internet Trends presentation shows how people are using their devices more and more:

screen-shot-2018-05-31-at-10-09-37
Source: Mary Meeker, Internet Trends

Here are some interesting video/links on flipping AI and technology on its head to serve the interests of the people. Why not monitor the government for corruption, in service of individuals? Why not create an AI sidekick or bot for individuals that monitors their weaknesses and does tasks like purchase the cheapest possible item. These seem like much better projects than some of the current ones…..

https://www.wired.com/story/artificial-intelligence-yuval-noah-harari-tristan-harris/
https://video.wired.com/watch/yuval-harari-tristan-harris-humans-get-hacked
“We can use the technology in many different ways. I mean for example we now are using AI mainly in order to surveil individuals in the service of corporations and governments. But it can be flipped to the opposite direction. We can use the same surveillance systems to control the government in the service of individuals, to monitor, for example, government officials that they are not corrupt. The technology is willing to do that. The question is whether we’re willing to develop the necessary tools to do it.”

“YNH: The system in itself can do amazing things for us. We just need to turn it around, that it serves our interests, whatever that is and not the interests of the corporation or the government. OK, now that we realize that our brains can be hacked, we need an antivirus for the brain, just as we have one for the computer. And it can work on the basis of the same technology. Let’s say you have an AI sidekick who monitors you all the time, 24 hours a day. What do you write? What do you see? Everything. But this AI is serving you as this fiduciary responsibility. And it gets to know your weaknesses, and by knowing your weaknesses it can protect you against other agents trying to hack you and to exploit your weaknesses.”

“So we think about this is like the whole framework of humane technology is we think this is the thing: We have to hold up the mirror to ourselves to understand our vulnerabilities first. And you design starting from a view of what we’re vulnerable to. I think from a practical perspective I totally agree with this idea of an AI sidekick but if we’re imagining like we live in the reality, the scary reality that we’re talking about right now. It’s not like this is some sci-fi future. This is the actual state. So we’re actually thinking about how do we navigate to an actual state of affairs that we want, we probably don’t want an AI sidekick to be this kind of optional thing that some people who are rich can afford and other people who don’t can’t, we probably want it to be baked into the way technology works in the first place, so that it does have a fiduciary responsibility to our best, subtle, compassionate, vulnerable interests.

NT: So we will have government sponsored AI sidekicks? We will have corporations that sell us AI sidekicks but subsidize them, so it’s not just the affluent that have really good AI sidekicks?”

https://www.wired.com/story/artificial-intelligence-yuval-noah-harari-tristan-harris/

World After Capital By Albert Wenger – bots to serve the people

AI odds and ends:

https://hbr.org/2018/09/a-blueprint-for-a-better-digital-society
“But there is an alternative: an emerging class of business models in which internet users are also the customers and the sellers. Data creators directly trade on the value of their data in an information-centric future economy. Direct buying and selling of information-based value between primary parties could replace the selling of surveillance and persuasion to third parties. Platforms would not shrivel in this economy; rather, they would thrive and grow dramatically, although their profit margins would likely fall as more value was returned to data creators. Most important, a market for data would restore dignity to data creators, who would become central to a dignified information economy.”

Syllabus for Glen Weyl’s very interesting course:
https://www.dropbox.com/s/fjzbpaoiq545s55/Syllabus.pdf?dl=0

AI winter update: I’ve posted quite a few optimistic videos about autonomous driving so i’ll even it out with this reality check. Some great links in this piece.
https://blog.piekniewski.info/2018/10/29/ai-winter-update/

“While on the self-driving car subject, one of the main criticisms of my original AI winter post was that I omitted Waymo from my discussion, them being the unquestionable leader in autonomy. This criticism was a bit unjustified in that I did include and discussed Waymo extensively in my other posts [1], but in these circumstances it appears prudent to mention what is going on there. Luckily a recent very good piece of investigative journalism shines some light on the matter. Apparently Waymo cars tested in Phoenix area had trouble with the most basic driving situations such as merging onto a freeway or making a left turn, [1]. The piece worth citing from the article:

‘There are times when it seems “autonomy is around the corner,” and the vehicle can go for a day without a human driver intervening, said a person familiar with Waymo. Other days reality sets in because “the edge cases are endless.”’

Some independent observations appear to confirm this assessment. As much as I agree that Waymo is probably the most advanced in this game, this does not mean they are anywhere near to actually deploying anything seriously, and even further away from making such deployment economically feasible (contrary to what is suggested in occasional puff pieces such as this one). Aside from a periodic PR nonsense, Waymo does not seem to be revealing much, though recently some baffling reports of past shenanigans in google chauffeur (which later became Waymo) surfaced, involving Anthony Levandowski who is responsible for the whole Uber-Waymo fiasco. To add some comical aspect to the Waymo-Uber story, apparently an unrelated engineer managed to invalidate the patent that Uber got sued over, spending altogether 6000 dollars in fees. This is probably how much Uber payed their patent attorneys for a minute of their work…

Speaking of Uber they substantially slowed their self-driving program, practically killed their self driving truck program (same one that delivered a few crates of beer in Colorado in 2016 with great fanfares, a demo that later on turned out to be completely staged), and recent rumors indicate they might be even looking to sell the unit.

‘Generally the other self driving car projects are facing increasing headwinds, with some projects already getting shut down by the government agencies, and others going more low-key with respect to public announcements. Particularly interesting news came recently out of Cruise, the second in the race right after Waymo (at least according to California disengagement data). Some noteworthy bits from the Reuters article:

Those expectations are now hitting speed bumps, according to interviews with eight current and former GM and Cruise employees and executives, along with nine autonomous vehicle technology experts familiar with Cruise. These sources say that some unexpected technical challenges – including the difficulty that Cruise cars have identifying whether objects are in motion – mean putting GM’s driverless cars on the road in a large scale way in 2019 is looking highly unlikely.

“Nothing is on schedule,” said one GM source, referring to certain mileage targets and other milestones the company has already missed.”

“Now I could not care less about results in game domains, since as I stated multiple times on this blog [1, 2], the only problem really worth solving in AI is the Moravec’s paradox, which is exactly the opposite of what DeepMind or OpenAI are doing, but I nevertheless found this media misfire hilarious.”

Data should be seen as labor rather than capital (Glen Weyl):

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Economic Links – Oct 2018

Its been a crazy volatile week in the markets, thought i’d post some relevant articles and videos.

A few notes first:

-US monetary policy is tightening while US fiscal policy is stimulative. US is running the largest fiscal deficit at the peak of the business cycle, which has never been done before.

-US Leading indicator is still above zero, although is declining. The World LEI is declining and below zero.
2018-06-08_1239

Source: Recessionalert.com

-Inflation is a big wildcard. The subject of a future post. Deflation first and then inflation? or vice versa…

 

 

Videos and Links: 

Alex Chausovsky recently delivered ITR’s most up-to-date economic outlook at the @MeasControl event. Check out some of the highlights!

-ITR’s long term outlook: “The real problems with debt won’t come until interest rates go significantly higher, as in the late 1970s and early 1980s. Until that happens, worries about business debt levels are overstated. While the problem is forming now, the consequences will come about 10 years from now. Higher interest rates on ascending debt levels play quite well into our forecast of a Great Depression beginning around 2030 (the details of which are in our book, Prosperity in the Age of Decline).”

Hedgeye: How to survive the quad 4 hurricane. Check out their growth/inflation quadrant work!

https://app.hedgeye.com/e/7A’/a6*)9k/market-edges-week-of-9-23-2018

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Fat-pitch weekly: http://fat-pitch.blogspot.com/2018/10/weekly-market-summary_28.html
“Summary: US equities are down 10% from their all-time highs just 5 weeks ago. The trend in equities has turned bearish, and that is not something that should be taken lightly. The evidence pointing to a major top being formed has further increased. But the set up for higher prices, at least before a significantly lower low, appears to be very strong. This is not a certainty, but it is a high probability.”

Financial Sense Investment Strategy Conference 2018:
https://www.financialsense.com/isc2018
I especially liked their characterization of the market a few weeks ago as ‘Flash Crashes and Flash Bubbles’

GaveKal links:
GaveKal: Are we still in a bull market? via Jesse Felder

https://www.cmgwealth.com/ri/on-my-radar-august-17/

“What caught my eye this week? Louis updated his Four Quadrants Framework chart and said, “For the last 30 years the world has broadly been at the bottom of our four quadrants, oscillating between disinflationary busts and disinflationary booms. We are now at a strange moment: most of the world is moving from disinflationary boom to disinflationary bust; but the US is moving towards an inflationary boom. This divergence doesn’t make portfolio construction easy.” He concluded, “A similar situation more or less prevailed in 1998-2000 and did not end happily.”

Here is the updated chart:”
20181028unnamed
https://www.cmgwealth.com/ri/on-my-radar-mauldin-economics-2018-sic-part-4-louis-vincent-gave-chinas-game-changing-policy-shifts/
-GaveKal Update 2: Quarterly Outlook: https://blog.knowledgeleaderscapital.com/?p=14554

Daniel Lacalle on the Biggest Bubble of All

Ray Dalio on Debt Cycles

How the economic machine works – Ray Dalio

Update: 2018-10-29 Interesting debt rollover timing
DqSXHnDUUAE8zdy.jpg
Source: JP Morgan

rollover
Source: FinancialSense.com

Links for September 2018

The Coddling of the American Mind by Jonathan Haidt
https://www.hiddenforces.io/podcast/show/jonathan-haidt-trigger-warnings-safe-spaces

“This week, on Hidden Forces, Jonathan Haidt joins us for a conversation on trigger warnings, safe spaces, and how good intentions and bad ideas are setting up the iGeneration for failure. Jonathan and Greggory Lukianoff’s latest book, The Coddling of the American Mind, is now available in bookstores nationwide. ”

“Studies show that unstructured play time is crucial for the healthy development of a child. So, why have parents been forcing more and more structure onto their children? @JonHaidt @glukianoff discuss the science behind the need for more independence. http://bit.ly/2otS7Fz”

Also see his interview with Sam Harris: https://samharris.org/podcasts/137-safe-space/

“Bradley Campbell @CampbellSocProf Sep 6
The Three Great Untruths, from @JonHaidt and @glukianoff’s new book The Coddling of the American Mind: How Good Intentions and Bad Ideas Are Setting Up a Generation for Failure”
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D.A. Wallach: music, medicine, cancer screening, and disruptive technologies. Interesting conversation begins around 50min on music and continues into medicine. (EP.06) : https://overcast.fm/+NmiSHY5lU/1:13:33

Microtrends Squared

https://player.fm/series/inside-the-ice-house/episode-20-microtrends-squared-a-conversation-with-mark-penn

“Mark Penn, author of Microtrends Squared, The New Small Forces Driving the Big Disruptions Today, joins the podcast to breakdown the trends that are driving the modern world. Microtrends and countertrends often make up only one percent of the American public, but create massive social movements capable of changing the commercial, political and social landscapes.”

Thinking About Thinking: My Interview with Tyler Cowen — On this episode of The Knowledge Project, I chat with Tyler Cowen, economics professor, author, and creator of the wildly popular blog, Marginal Revolution. We tackle lots of interesting topics, including tech advances, the changing labor market, and upgrading your thinking process to accommodate the information age.

Exponential Energy trends:

Elon Musk:

Bineural beats (use stere headphones for full effect, good for meditation):

Most likely to succeed: Preview of a great documentary on education

A different take on the US housing bust, unlike the credit boom/bust narrative:
https://soundcloud.com/macro-musings/kevinerdmann

The FIRE/ERE movement gets some mainstream coverage:
https://www.nytimes.com/2018/09/01/style/fire-financial-independence-retire-early.html

Cullen Roche’s reaction:
https://www.pragcap.com/view-fire-movement/
“The FIRE movement – a good set of goals and aspirations that are probably unattainable or unrealistic for most of us.”

Coverage of ‘Bullshit Jobs’ and the connection to increasingly intangible work:
https://twitter.com/bygeorgist/status/1021043349338324992, https://twitter.com/bygeorgist/status/1021043623071232001

Its getting better

Linkfest August 2018

The Rise of AI
https://www.bloomberg.com/news/videos/2018-05-23/hello-world-canada-the-rise-of-ai-video

Ray Dalio’s Principles:

What the future of medicine could look like. A fascinating and wide ranging interview that looks at the role of technology, new tests, and much more: https://overcast.fm/+NmiSHY5lU/1:13:33

Data should be seen as labor rather than capital (Glen Weyl):

Next generation interfaces:
View story at Medium.com
“Forget what you’ve heard about brain implants — that’s too invasive and, frankly, pretty scary. The future of brain-machine interfaces is non-invasive. Instead of surgical implants, CTRL-labs uses state-of-the-art signal detection and machine learning to read your neurons from outside the body. The first step will be technology precisely picking up the signals from inside your body to control devices outside of it with little more than natural gestures. The next step — and we are already closer than most people realize — will be reading the intention directly from your brain.”

Got Privacy?

Privacy and algorithmic governance

Andrew Yang on Universal Basic Income:


https://ideas.ted.com/humanity-is-more-important-than-money-its-time-for-capitalism-to-get-an-upgrade/
https://samharris.org/podcasts/130-universal-basic-income/

Interesting series on trade:
05/25/2018 – This Is How the World Ends, Part V

Banks have a monopoly on credit creation, and use that monopoly power to invest mainly in the purchasing of existing assets (land,etc) rather than new tangible capital formation.

Past Kaggle (Data Science) Competition Solutions:
http://ndres.me/kaggle-past-solutions/
https://www.kaggle.com/sudalairajkumar/winning-solutions-of-kaggle-competitions
http://www.chioka.in/kaggle-competition-solutions/

R Finance Past Presentations:
http://www.rinfinance.com/RinFinance2018/
http://blog.revolutionanalytics.com/2017/05/watch-rfinance-2017.html
http://www.cvent.com/events/2018-r-finance-conference/custom-35-66f251bca58b4149a9fcc3aca1867dd7.aspx

Andrew Scott on “The 100-Year Life: Living and Working in an Age of Longevity”
“Jim welcomes Professor Andrew Scott, Professor of Economics at the London Business School, and co-author of The 100-Year Life. Professor Scott notes that with every new decade, lifespan is now increasing by 2-3 years, and a child born in 2007 has a 50% chance of living to 104 years old. They discuss how the traditional Three Stage Life (education, work, and retirement) is ending, and we may soon be looking at a 50-70 year working career. There are many risks ahead as well, as the emergence of Big Data and Artificial Intelligence will threaten millions of jobs in the future. There will also be tremendous challenges for society and especially government, as greater longevity will put even greater strains on the government to care for those unable to support themselves in extreme old age. Professor Scott emphasized the importance of people in their 60’s and beyond developing the ability to deal with change and adapt to new ideas.”

I’ve watched the FIRE (Financial Independence and Retire Early) / ERE (Early Retirement Extreme) movements for the last year. I think given long lifespans, the whole system will have to be re-thought. Returns from investments will probably be lower than most people except and some DB pensions will come under pressure in the future. However, I do like the idea of focusing what you can control (high savings rate) and also diversifying your income streams for increased resilience.
I also enjoyed Michael Kitces diagram on different approaches to retirement:

graphics_3

Stream Radiohead and DMB

I saw Radiohead and Dave Matthews Band live in Toronto in the last few weeks, they were great shows!

You don’t have to go to the show to enjoy live music.
If you join DMB’s mailing list, they will often announce live streams and have announce live streams for Friday’s in July.
https://twitter.com/dmblive

Radiohead often has live streams via Periscope or other platforms. You can check out the following twitter feed for announcements:
https://twitter.com/radioheadlive

Here is the setlist from the concert I went to in Toronto:
https://www.setlist.fm/setlist/radiohead/2018/scotiabank-arena-toronto-on-canada-3bebf8a8.html

And some high-def videos from the Toronto shows (and others):
https://www.youtube.com/user/allbearsrule/videos
https://www.youtube.com/user/nastysurprise/videos
https://www.youtube.com/playlist?index=1&list=PLKoI26-azcEev45cI3RyHcDx_54FaILox&playnext=1

Good luck

The Ontario election is looming, and it does not look like there are any good choices. Perhaps the best choice is a minority government.
ont-elxn-first-debate-20180507

It looks like there is a high and growing probably of an Ontario recession next year due to a housing led weakness in ontario, and mid cycle slowdowns in US and China, our trading partners, along with growing trade uncertainty. We will explore this in a further post. Given this backdrop, perhaps counter cyclical government spending is a good idea if the private sector is retrenching.

https://platform.twitter.com/widgets.js

Further relevant reading: Is Canada at risk of a balance sheet recession, or see my deleveraging page
koo-fig5-1024x633
Source: Is Canada at risk of a balance sheet recession?

In listening to each party’s taking points, it seems as though we are far from creating real solutions that society will need in the future. Solutions will require the best of what the left and right have to offer.
-Instead of talking about how many nurses are going to get fired, or how privatization is bad, why not look to examples like Singapore Health system, which only spends 4% of GDP with similar outcomes: “But Singapore isn’t a free market utopia. Quite the opposite, really. It’s a largely state-run health care system where the government designed the insurance products with a healthy appreciation for free market principles — the kind of policy Milton Friedman might have crafted if he’d been a socialist.”
-Use public spending to enhance infrastructure and fund long term projects with patient capital instead of creating bullshit jobs
-Roll out an unconditional basic income for everyone as a safety net (hint: we should have funded a sovereign wealth fund with oil/resource tax revenue that would pay this out)
-A speculation tax on housing? Potentially, how about a land value tax, or shifting the tax burden off of labour and income onto economic rents. Target unproductive investment and economic rent instead of just the wealthy for redistribution.
doofjl1x0aic9ep
-Re-evaluate as as society the role of money and banking, and the monopoly power and privileged that commercial banks have to create credit. Minimize the use of credit for speculation on securities and bidding up the price of scarce land
-Eliminate monopolies and oligopolies, learn how we can win again
-Cut the waste, but restore the Commons
-Work towards establishing better Governance and Transparency: “A recent report by Transparency International ranked Canada and South Korea the lowest in the G20 for financial transparency. Since committing to increase transparency in 2014, Canada has not improved its regulatory framework, the report said.”

I know this all spans multiple levels of government, but just a few thoughts….

20180606_190854

Update 2018/06/20:

Peter Zeihan on Canada: 06/20/2018 – I Think They Get It Now, Part Seven/Sept: Canada

“Canada has something other Bretton Woods members do not: leverage. Canada is directly adjacent to the United States. That means the Americans traded with the Canadians not only before Bretton Woods, but before the industrial revolution hit the North American continent. NAFTA is the only active trade deal the Americans have that was not a strategic swap of the Bretton Woods model.

That provides Canada a unique opening. Broadscale chaos in the global system will not overly harm the domestic American experience, but mild chaos in North America would. Unlike Japan or France or Italy or Germany or the United Kingdom, the Canadians have their claws into the American economy’s guts, giving Canada the option of hitting America where it hurts. When the Canadians talk reciprocal tariffs, it matters.

And the Canadians know what to do with that leverage, because Canada has something else the other Bretton Woods allies lack: insight. ”

“…But something most Canadians miss is that while their proximity to and close relationship with the United States does indeed grant them security and leverage and insight, that’s only an advantage if the Americans are distracted.

End America’s position as the global leader. Take most of those irons out of the fire. Contract America’s already small international economic footprint. Washington’s to-do list shrinks immeasurably. Purely by circumstance, Canada moves up. Way up.

Canada faces very real danger of national fracture without American attention. But if the American population or presidency perceives – rightly or wrongly – that Canada is part of the problem rather than part of the solution, then the full power of the American system can be brought to bear on its politically, economically and strategically fragile neighbor. ”

Potential U.S. Auto Tariffs: Canadian Scenario Analysis

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How the economic machine works by Ray Dalio