Artificial Intelligence Post Number 32

I haven’t posted for a while because it seems like we are all just watching AI being implemented in many different areas. As expected, the initial areas of implementation have been narrowly focused, but their impacts are already being felt. For example, Tesla Motors has been incorporating their autonomous drive system very rapidly, such that they feel that they can already see substantial gains. To quote their CEO, Elon Musk:

“The probability of having an accident is 50% lower if you have Autopilot on. Even with our first version. So we can see basically what’s the average number of kilometers to an accident – accident defined by airbag deployment. Even with this early version, it’s almost twice as good as a person . . . I think it’s going to be important in terms of satisfying regulators and the public to show statistically with a large amount of data – with billions of kilometers of driving – to say that the safety level is definitively better, by a meaningful margin, if it’s autonomous versus non-autonomous.”

It will be a while before Tesla can log billions of miles of data, but already Tesla drivers have recorded 47 million miles in Autopilot mode.  I recently rode in a Tesla with Autopilot, and it truly is remarkable. It not only had automatic braking in case of an obstacle ahead, but had lane maintenance ability. It was easy to see how a human driver, especially if they look away for a second or so, would be slower to respond to an issue in front or next to their car. (Note that I am one of the 400,000 people who put a $1,000 deposit on the Tesla Model 3 that will not be out for over a year.  So I may be biased.)

As I have noted in earlier posts, Elon Musk is afraid that AI could be a real risk for mankind as AI gets more and more advanced and powerful. Not everyone agrees. Zuckerberg of Facebook believes that mankind will easily be able to control AI, and he is clear that Facebook will be pushing AI to its limit, including using face recognition systems.

I have been spending some time trying to understand where AI’s strengths and weaknesses will be. AI will certainly surpass man’s ability to use existing data. Thus areas like medicine, accounting, law, investing, and teaching are at risk. And in many areas the strength of AI will come in its growing ability to do calculated guessing. A lot of the gains on vision systems used for autonomous driving come from improvements in software and chip design that enable the computer to make judgments on limited data, much as our brain does.

But AI still requires understanding, measurement, and data. Many of the unknown areas mankind is pursuing may not be enhanced by AI. For example, quantum entanglement, which can include instant communication across long distances and which Einstein called spooky, is still not understood by anyone. Even areas we thought we understood, like our universe starting with the Big Bang has been muddied by including expansion (which had to go faster than the speed of light), and the question whether the expansion happened before or after the Big Bang. Or even the size and age of our universe given all the questions related to red shift that is used in so many measurements. Is our universe expanding (at an ever increasing rate) or contracting? What is dark matter and dark energy?

Even evolution has issues related to Darwin believing everything was gradual whereas some fossils and some tests show that some evolutionary changes are apparently sudden. We are not as smart as we think we are, and in these areas AI may not be any smarter!

As promised, here is an update on Elliot Wave’s prediction that the S&P 500 will drop 41.6% this year from 1880 to 1100. I said that I didn’t believe it! The current S&P is 2065, up almost 10% since EW’s prediction early this year. Are you fans of EW still holding in there?


5 Responses to “Artificial Intelligence Post Number 32”

  1. Bob Says:

    ” Are you fans of EW still holding in there?” Personally I don’t care about Elliot Wave. What I do care about is whether we are in a bull market or bear market. When I say bull/bear, I mean a market that will be trending lower/higher over the next few years. I would say there is about an 80+ % chance we are in a bear market. Where that bear market leads is another question. I have two IRA accounts I manage, as well as 4 brokerage accounts. I realize some people are passive investors, and that is fine. Personally I would rather lock in some of the gains from the last several years, and be overweight bonds/cash for the next few years. To each their own.

  2. Bob Says:–sector.html

  3. Bob Kaufmsn Says:

    I recommend checking out and a conversation with dr. Gary Marcus . It makes a case that the computer inside our head is extra special and that in combination with our bodies makes us really special. This does not mean that AI is not going to advance but it might be different than most think. Marcus is afraid that expectations and interest levels are so high that that interest may wane if advances are slow in trying to get to the type of intelligence humans possess. He also thinks that AI might help use further understand our brains and in so doing speed the journey to general and strong artificial intelligence. Interesting!

  4. Albert Says:


    Why did we just see the retailer’s earning fall flat? Macy’s, Nordstrom and Kohls have disappointed. Is it because Amazon has shifted shopping patterns to online? What does your data about current American’s debt show?

    Why do you think Middle class Americans aren’t buying or can’t buy? Are we seeing a demographic change in baby boomers buying less and millineals being less materialistic that the prior generations. With the recent headlines about retailers….it may the canary in the coal mine, What do you think?

  5. wbrussee Says:

    Albert says, “Macy’s, Nordstrom and Kohls have disappointed. Is it because Amazon has shifted shopping patterns to online?”

    Amazon sales:
    2011 $48B
    2012 $61B
    2013 $74B
    2014 $89B
    2015 $107B
    And first quarter 2016 is up 28% over first quarter 2015.

    New car/truck sales are up 6 years in a row, with first quarter 2016 up 6% over 2015.

    So, consumers are still buying.

    The world is changing, and it would be very surprising if the way we shop or what we shop for did not also change. The U.S. seems to be very poised to benefit from this. The risk is if we elect a President that throws all this to the wind through stupidity and ego.

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