The Sunday Drive - 02/25/2024 Edition [#99]
Musings and Meanderings of a Financial Provocateur
👋🏼 Hello friends,
Let's enjoy a leisurely Sunday Drive around the internet.
🎶 Vibin'
Animal spirits were quite evident this past week, as the equity market continued to grind higher, especially in response to this week’s earnings report from AI semiconductor maker, Nvidia. So this week, I’m vibin’ to the Steve Miller Band’s Fly Like an Eagle, the title track from the 1976 album of the same name. Enjoy.
💭 Quote of the Week
“Every great dream begins with a dreamer. Always remember, you have within you the strength, the patience, and the passion to reach for the stars to change the world.”
– Hariett Tubman
📈 Chart of the Week
In last week’s Sunday Drive, I think I finally stumbled upon a somewhat cogent way of discussing a theme that had previously been fairly disjointed, but which I view as very important.
I am referring to the role of Artificial Intelligence (AI) in an aging society. For lack of a better term, let’s call it, uhmm…. GrAy-I. 🙄
This week’s Chart shows that the U.S. population will have over four million people turning 65 for at least the next six years. That number will remain elevated for quite a number of years beyond that.
How we as a society utilize AI to keep our aging populace healthy, productive, and able to lead meaningful lives will be critical, in my view. It will have dramatic effects on our economy, on financial markets, and on our ability to remain the most innovative country in the world.
I think this theme is worthy of future discussion, so expect more Gray-I topics and articles. If you have any thoughts, suggestions, feedback, or other ideas, please email me.
🚙 Interesting Drive-By's
This week we have articles on optimism, 65, AI tutors, non-bank finance, and ChatGPT:
📈 Is a Future-Optimist Vibe Shift Happening? - from James Pethokoukis
Let’s talk about vibe shifts. The “shift” being talked about here is, in the most simple of terms, a shift from societal can’t do pessimism to can-do optimism, or at least the beginning of one.
“Pessimism,” or what I call Down Wing thinking: favoring caution over innovation; emphasizing safety and stability against the disruption of progress; skepticism towards technologies like AI, GMOs, nuclear power, and autonomous vehicles, driven by fears of unforeseen impacts and job losses; viewing progress through a zero-sum lens with a preference for the status quo over the potential benefits of exploratory change; deep-seated cynicism towards tech progress as a problem-solving tool, as well as toward entrepreneurial market capitalism. Better safe than sorry.
“Optimism,” or Up Wing thinking: a forward-looking approach, deeply rooted in the conviction that technology and innovation are still key to humanity's continued progress; embracing risk to surpass existing limits while aiming for a future marked by abundance and rapid growth; enthusiasm about the upside potential of disruptive technologies such as AI, CRISPR, and the space economy; confidence in entrepreneurial capitalism to solve global challenges and drive greater wealth and opportunity; a relentless pursuit of progress that expands human capabilities to create a better world of greater possibility. Never take a risk is the biggest risk of all.
What’s s the evidence of an emerging vibe shift in an Up Wing direction? So far it seems more impressionistic than empirical, which is maybe understandable given we're talking “vibes” here, after all. But I’ve certainly noticed what seems to be a substantial increase in Up Wing content on social media, including news about tech progress, memes, AI-generated future-optimist images, and fact-checking of doomer and degrowthers claims. (No, life was not better in medieval times.) Great, refreshing stuff. [link]
🤔 Peak 65: The Shift to an Older Society Begins - from Brian Clark
When I did a guided personal development exercise to discover the one word that defined me, it ended up being further. For me, the saying “Happiness is a way of travel, not a destination” seemed apt, but I still thought I was weird.
It was the process of writing the early version of Further that helped me understand that having a growth mindset and a strong need for self determination was why I’m the way I am, and it’s not a bad thing.
Later, I discovered the U-Shaped Happiness Curve that helped explain the discontent of my 40s despite being at the height of success. It’s no coincidence that I sold my company shortly after I turned 50, because I realized that I simply wanted something different out of life.
That led to reading The Longevity Economy by Joseph Coughlin in 2018, which prompted me to change the focus of Further to issues related specifically to midlife. Retirement became a natural focus, especially when people constantly asked if I was going to retire after the acquisitions. [link]
💡 Personalized AI Tutors for Every Student - from Peter Diamandis
Imagine a future where every student has their own personalized AI that is customized for them and looks out for them.
Are you a visual learner? Do you learn best through listening? Are you dyslexic?
Imagine an AI that is using an iPad’s forward-looking camera to study a student’s facial expressions as a lesson is being delivered. If the student looks confused or bored, the AI can change tack, adjusting the lesson accordingly from a different point of view, or at a different level of complexity.
Imagine a future where a teacher’s AI copilot adapts to each student’s learning style and pace, offering personalized education, incorporating a student’s favorite sports stars or movie stars into the curriculum. It can track a given student’s progress, identify trouble areas, and optimize on the fly.
Beyond AI alone, the combination of AI and VR together promises to make learning “experiential” and “immersive,” delivering lessons that are literally unforgettable and hyper-personalized. [link]
💰 Non-Bank Finance in America - from Arnold Kling
Another term for direct lending is disintermediation. That is, instead of borrowers and lenders connecting via bank intermediaries, other lending institutions sprang up.
In my lifetime, much of this disintermediation was fostered by regulatory constraints on banks. In the 1970s and 1980s, when banks were tied down by ceilings on the interest rates that they could pay depositors, junk bonds took off. The Savings and Loan debacle of the 1980s was largely caused by regulatory distortions and was exacerbated by the S&Ls’ forays into junk bonds. In reaction, banking agencies imposed capital requirements that effectively penalized banks for making commercial loans—and instead pushed them into mortgage securities, which became the next crisis.
In most of the rest of the developed world, banks play a much larger role in finance. In Europe, Canada, and elsewhere, stock and bond markets account for a relatively smaller share of financial assets. [link]
💯 She’s Running a Business, Writing a Book, Getting a Ph.D. - With ChatGPT - from Dan Shipper
Anne-Laure Le Cunff might be the most productive person I’ve ever encountered.
She’s the founder of Ness Labs, a newsletter and learning community of almost 100,000 curious minds aspiring to achieve their goals and keep their mental health at the same time. She’s a Ph.D. candidate in psychology and neuroscience at King's College London. As if that’s not enough, she’s also writing a book with a major publisher on the intersection between curiosity and ambition.
It’s a mind-bending list of ambitious projects, and I was pleasantly surprised when she told me she can only do it all because of ChatGPT. It seemed almost too good to be true, but as we got deeper into the interview, I saw how much AI has seeped into every corner of her life.
It saves her time on the administrative tasks required to run her business. It helps her create better outlines so that she can write pieces more efficiently. It even breaks down complex research papers so that she can incorporate them into her Ph.D. work. [link]
👋🏼 Parting Thought
What a week…
If you have any cool articles or ideas that might be interesting for future Sunday Drive-by's, please send them along or tweet 'em (X ‘em?) at me.
Please note that the content in The Sunday Drive is intended for informational purposes only, and is in no way intended to be financial, legal, tax, marital, or even cooking advice. Consult your own professionals as needed.
I hope you have a relaxing weekend and a great week ahead. See you next Sunday...
Your faithful financial provocateur,
-Mike
If you enjoy the Sunday Drive, I'd be honored if you'd share it with others.
If this was forwarded to you, please subscribe and join the other geniuses who are reading this newsletter.