I was recently on the MTA train coming back home from NYC & a young teenager got mixed up with his train. Me and the folks next to me helped him navigate to the right train & the conductor didn’t charge him for the mix-up. This moment gave me hope in humanity as a whole.
The lesson here, is when you realize you are on the wrong train, get off of it as soon as possible and get back to where you belong. This is easier said than done sometimes and can be applied to almost anything in life.
“The longer you stay on the wrong train the more expensive it is to get home.”
Tying this back into investing, some of the best portfolio managers I met during my time in research recognized when they were in the wrong investment. They knew how to take accountability, acknowledge it, and pivot. The longer they stayed in the wrong investment the more expensive it typically was.
The same goes for really any investor or investment. We must always ask ourselves WHY a company is growing or WHY it is shrinking. We also need to recognize when the masks of corporate America are misleading us.
So how do we teach young investors the art of healthy skepticism?
Encourage ALL questions - no question is ever too silly
Explore Fact Checking - Fact-checking games can help
Use Real Life Examples - Discuss situations where misinformation might be present
In the world of AI, this becomes even more challenging. While we see the market love for technology names like Nvidia, & Microsoft. We also have seen events where false statements from A.I. drive the stock market down.
In 2023: An image of black smoke billowing from what appeared to be a government building near the Pentagon set off investor fears, sending stocks tumbling.
Luckily, experts quickly dismissed the picture as a fake, and the stock market swiftly recovered. This further illustrates the importance of healthy skepticism.
The moral of the story here is we must always challenge what a company is actually doing and if it is in fact, actually possible. Here are some skeptical questions I often ask myself around AI:
AI will lead to large gains in Productivity & Growth: How long will this transition take? For example: Electric motors were invented in the late 1800s but didn’t transform factory production until about fifty years later!
Where are people using AI today & when will it become more reliable?
How energy efficient do the chips need to be to reach a power equilibrium? - For Context: Nvidia’s Blackwell chip is 25x more energy efficient than it’s previous chip the Hopper. Think of “Performance per watt”!
Our power is limited: Will our grid be able to scale in time to support the increasing importance & demand AI Titans expect to achieve?
What power mix is the most efficient & timely for AI demands? - Nuclear, Battery Storage, Oil/Gas, Solar???
Happy Turkey Day Stock Explorers!
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Open AI SORA has been leaked
Big Tech Transitions are slow…..
Google’s Gemini chatbot now has memory
Apple is developing a conversational Siri
Girl Boss: Meta hires Salesforce’s CEO of AI, Clara Shih, to lead new business AI group
