Alberto: I find your charts fascinating, but I have some questions. (consider that I am 83, an analog grandpa in a digital world.). You mention "right vs. wrong responses." My experience tells me that right and wrong are slippery terms. Some responses, like those in the "real world," are often hard to characterize one way or the other. I don't find all that many purely wrong AI bleats, but when I know something about the subject, I may find them incomplete.
I don't automatically get the distinction between reliability and accuracy.
I also see your distinction between the widespread and the power users. But I wonder whether AI needs many users who are just dabbling. Can it be successful as a technology if it only becomes valuable to "power users?" (One of my favorite movie analogies here is Interstellar, where the true believers had to hide the space program from the common citizenry. The true believers win out, but it is a bittersweet victory.)
Drilling down on that thought, it just occurred to me that military and national security uses may justify a huge amount of AI, whether the average citizen wants or likes it.
Thanks for your work. I had my eyes opened by your earlier piece on public opinion polls about AI. Luckily, I've always been a bit of a contrarian.
Stock prices are not economy-carrying, right? You could say only 10 companies are responsible for the entire stock valuation on SP500, but it's neither fair nor correct to state it's *economy carrying*. Stock market prices tell you only about corporate wealth and future expectations, it's not real economy (employment, production, etc)
Congratulations on discovering the obvious and on the pretty graphs.
I especially like the one that shows the oldest going model of artificial intelligence converging into a new one, complete with rights to free speech and, in some places, voting.
Strip out 10 names and the inflation-adjusted market is contracting, which reframes the index as a wrapper around a handful of balance sheets rather than a broad economy. What that framing leaves on the table is that the concentration isn't a distortion of the benchmark, it's the benchmark finally telling the truth, since a float-weighted replica run daily from 2018 shows return and risk-adjusted efficiency peaking hard around the top five to ten before decaying all the way down to the total market.
Bessembinder's finding that a sliver of firms accounts for essentially all equity wealth creation means the S&P490 you're subtracting was mostly dead weight on a risk-adjusted basis long before AI capex made it obvious.
Alberto: I find your charts fascinating, but I have some questions. (consider that I am 83, an analog grandpa in a digital world.). You mention "right vs. wrong responses." My experience tells me that right and wrong are slippery terms. Some responses, like those in the "real world," are often hard to characterize one way or the other. I don't find all that many purely wrong AI bleats, but when I know something about the subject, I may find them incomplete.
I don't automatically get the distinction between reliability and accuracy.
I also see your distinction between the widespread and the power users. But I wonder whether AI needs many users who are just dabbling. Can it be successful as a technology if it only becomes valuable to "power users?" (One of my favorite movie analogies here is Interstellar, where the true believers had to hide the space program from the common citizenry. The true believers win out, but it is a bittersweet victory.)
Drilling down on that thought, it just occurred to me that military and national security uses may justify a huge amount of AI, whether the average citizen wants or likes it.
Thanks for your work. I had my eyes opened by your earlier piece on public opinion polls about AI. Luckily, I've always been a bit of a contrarian.
Stock prices are not economy-carrying, right? You could say only 10 companies are responsible for the entire stock valuation on SP500, but it's neither fair nor correct to state it's *economy carrying*. Stock market prices tell you only about corporate wealth and future expectations, it's not real economy (employment, production, etc)
Yes, it's a simplification. This is intended for a general audience
Congratulations on discovering the obvious and on the pretty graphs.
I especially like the one that shows the oldest going model of artificial intelligence converging into a new one, complete with rights to free speech and, in some places, voting.
Chart one is most important.
Strip out 10 names and the inflation-adjusted market is contracting, which reframes the index as a wrapper around a handful of balance sheets rather than a broad economy. What that framing leaves on the table is that the concentration isn't a distortion of the benchmark, it's the benchmark finally telling the truth, since a float-weighted replica run daily from 2018 shows return and risk-adjusted efficiency peaking hard around the top five to ten before decaying all the way down to the total market.
Bessembinder's finding that a sliver of firms accounts for essentially all equity wealth creation means the S&P490 you're subtracting was mostly dead weight on a risk-adjusted basis long before AI capex made it obvious.