DEPT OF THE NEAR FUTURE
🔑 Are we on the verge of a new golden age? Wonderful interview with one of EV’s favourite economists, Carlota Perez, and her cyclical theory of innovation and growth.
🦅 John Mauldin on the fragmentation of American society and the end of work.
There is a new robotic machine called an Iron Roughneck that reduces the human labor required to connect pipe from a crew of 20 down to a crew of five. And those jobs were quite high-paying. Here’s a picture of this new robotic roughneck. Fifteen workers per site at well over $100,000 a year each? Does that machine look like it cost more than a few million? I bet it amortizes pretty quickly, and that’s why it is being rapidly adopted….. The amazing thing is that this transformation happened in two years; it didn’t take a generation or even half a generation.
As predicted by many forecasts, “nerds and nurses” are key contributors to American job growth, according to a ten-year forecast by the Bureau of Labor Statistics.
No occupation is projected to add more workers than personal-care aides, who perform non-medical duties for older Americans, such as bathing and cooking […] Clean-energy workers, […] mathematicians and statisticians round out the top-10 list.
Meanwhile, American coal miners are eschewing retraining, expecting Trump to make good on his commitment to bring coal jobs back. If (more precisely, when) that doesn't happen, caregiving is another industry that promises to offer increasingly more work.
🏢 Post-Coase? The slow death of the firm. Nick Tomaino argues that “Bitcoin is the first example of an organizational structure that has the beneficial characteristics of the firm” as well as decentralised ownership and governance.
⛓️ The open Web as we knew started dying in 2014, argues Andre Saltz. The new web, formed of the Trinet of Amazon, Facebook and Google will be more vivid but less free. (Also, fascinating to see how unpleasant internet access looks like in Portugal, which doesn’t enforce the doctrine of net neutrality.)
The evolving economics of bitcoin, gold and fiat currencies. Solid analysis from CME Group
Will bitcoin rally another 5,000% or more until the outstanding value of the digital currency equals the outstanding value of the world’s gold? The short answer is that we don’t know... [but] precious metals do hold a potential insight into one factor that might limit bitcoin’s future upside.
💯 Why AI is waiting for its ethics transplant.
We read all of the existing ethical codes that have been published in the last two years that specifically consider AI and algorithmic systems. Then we looked at the difference between the ideals and what was actually happening. What is most urgently needed now is that these ethical guidelines are accompanied by very strong accountability mechanisms.
DEPT OF THE BRAINS
There is a fascinating ballet happening between artificial intelligence and the human brain and its emergent properties. One helps us peer deeper into the other, which in turn throws light on the other.
Brain researcher, Christopher Koch argues that we’ll need high-tech brain enhancements to keep up in a world of relentlessly improving artificial intelligence. Education alone won’t be enough. (WSJ registration required.)
We need to enhance our cognitive capabilities by directly intervening in our nervous systems. [...] People could set their brains to keep their focus on a task for hours on end, or control the length and depth of their sleep at will.
Another exciting prospect is melding two or more brains into a single conscious mind by direct neuron-to-neuron links. This entity could call upon the memories and skills of its member brains, but would act as one “group” consciousness, with a single, integrated purpose to coordinate highly complex activities across many bodies.
Purdue researchers have paired up high-fidelity fMRI scans with deep learning networks to decode videos people are watching, from brain activity alone. This is approaching real-time mind-reading.
And in an n=34 study, Carnegie Mellon researchers were able to identify suicidal thoughts by looking at fMRI scans.
That’s one half of the AI/brain pairing. How AI is better helping us understand & possibly impact our brains is the other half.
🤔 Geoff Hinton, the “grandfather of deep learning”, has a new approach to image classification called capsule networks. I’ve not read the academic paper, but this helpful write-up by Debarko De suggests that the capsule networks depart from the traditional deep learning approach. That approach has been to engineer the networks with as little prior information or structure as possible, and just have them learn from data. This approach has yielded significant results since the explosion of digital data post the Web. But it also produces very brittle systems, that lend themselves to trivial adversarial attacks or an inability to work with a slight change of context or perspective.
Capsule networks involve the use of capsules, which seem to encapsulate what grizzled-machine vision folk would have called feature engineering, and are essentially a mechanism for bootstrapping the learning process by giving the network some priors. Gary Marcus’ comment in the Wired piece is worth reading.
🌠 Jurgen Schmidhuber, the forgotten uncle of deep learning, writes with a lofty vision, eyes gazing firmly at the stars. His paean to long short-term memory (LSTM, a type of neural network) and its place in human progress, is worth pondering:
Humans won't play a significant role in the spreading of intelligence across the cosmos. But that's OK. Don’t think of humans as the crown of creation. Instead view human civilization as part of a much grander scheme, an important step (but not the last one) on the path of the universe towards higher complexity. Now it seems ready to take its next step, a step comparable to the invention of life itself over 3.5 billion years ago.
This is more than just another industrial revolution. This is something new that transcends humankind and even biology. It is a privilege to witness its beginnings, and contribute something to it.
DEPT OF INFO WARFARE
The truth of Russian meddling in global politics through social media platforms is starting to emerge. It isn’t just, as we humourously suggested in EV#86 a group of bored, but digital savvy teenagers in Veles, Macedonia.
No, it’s becoming clear that it is much more widely orchestrated, not just by Russia and their agents but by social networks (Facebook, and punching above its weight, Twitter) abetting them.
I used to run PeerIndex, which analysed 316m users on Twitter in real-time, predicting behaviours and scoring their trustworthiness and resonance in a highly granular fashion. My experience is that flagging, tracking and identifying bots or implementing mechanisms to audit who is buying ads is a pain, but is far from technically insurmountable.
This boils down to business decisions, the sorts of things Mustafa Suleyman alluded to in last week’s EV:
We also need to rethink the standard metrics our industry uses to measure progress - investment round valuations, “active users”... and revenues are the crudest of proxies for company success, and largely ignore externalities…
In any case, Facebook has admitted as much. Taking steps to mitigate abuse will hurt its profitability. In their recent earnings announcement, Zuckerberg says the company was shifting its focus to "time well spent". Tristan Harris, the promulgator of the 'time well spent' movement doubts Facebook's intention. (See EV#33 for a discussion on Tristan Harris and time well spent.)
My friends at The Economist pull no punches:
Facebook, Google and Twitter were supposed to save politics as good information drove out prejudice and falsehood. Something has gone very wrong and… [the] stakes for liberal democracy could hardly be higher.
SHORT MORSELS TO MAKE YOU SMART AT DINNER PARTIES
✍️ Why complex writing matters, particularly in the age of Twitter and emoji
The kids are alright. UK teens are drinking and drugging less than ever before. 🙌
💳 Contactless payments are 91% of transactions in Australia, 45% in Britain, and 5% in the US.
Electric cars emit less CO2 in their lifetime than diesels, even when powered by dirtiest electricity.
Fay Alberti: the microbiome and its relationship to gender and health.
💰 The richest families in Florence from 1427 are still the richest families in Florence. (2016 article)
Orchid Labs creates blockchain-based protocol to defeat censorship and surveillance.
Scientists discover mysterious chambers inside the pyramid of Giza using muon-detecting sensors—drones might be sent in to investigate further in the future.
🇫🇷 1800's Parisians grew mushrooms underneath their city.
Amazon grew its employee base 77% from June to September.
We have a new sponsor: Android handset maker, OnePlus. I wanted to thank long-time Exponential View reader, Carl Pei. Carl is the co-founder of OnePlus. He and I had a fascinating lunch earlier this year and I'm delighted he has agreed to support us.
On another note, I realise this issue is quite long. The weather has turned distinctly autumnal in the UK. I figured there might be call for sitting on a couch, having a coffee, and discussing these issues of the day. For those of you south of the Tropic of Cancer, enjoying equatorial climes or the early southern hemisphere summer, please find a cool verandah and some friends to enjoy this week's edition.
P.S. ❤️ If you liked this issue, please share it via Twitter & forward to your colleagues.