November 15, 2024 | Read Online

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"I do not fear computers. I fear the lack of them."

— Isaac Asimov

Friday accelerating charts

The Trump trade stalled this week as the animal spirits unleashed by his election seemed to abate, perhaps because the futuristic vision of acceleration and techno-optimistimism gave way to the mucky reality of political appointments.

Nevertheless, evidence that we're already accelerating abounded.

The CEO of Anthropic predicted this week that we'll have artificial general intelligence (AGI) by 2026 or 2027, with chatbots becoming "smarter than a Nobel Prize winner in every relevant discipline."

Among other marvels, this could compress 100 years of medical advancements into a single decade, he says.

Not to be outdone, Sam Altman predicted we'll reach AGI in 2025, but believes it will have "surprisingly little impact" on society — a happy middle ground between accelerationists and doomers that might represent a best-possible scenario for investors.

The outgoing Biden administration got into the acceleration game as well this week, unveiling a plan to triple nuclear power by 2050 — which, weirdly, is only 25 years away.

(If that's not good enough for you, we made significant progress on fusion energy this week, as well.)

Finally, and perhaps most consequentially, Google DeepMind abruptly open-sourced its AlphaFold model, an AI that predicts protein structures that represents "a game-changer for drug discovery and molecular research," as the accelerationist blogger Packy McCormick described it.

Google likely spent $10s of billions developing AlphaFold and now, incredibly, it's free for academic use.

This should make you feel good about all the Google searches you made and all the YouTube videos you watched over the past decade or so — the data and profits we've provided to Google are being put to good use.

(It maybe should make you feel good about the societal effects of tech monopolies, too.)

What's it mean for investors?

The economist Ed Yardeni said this week that he expects the US to experience a "productivity/growth boom — and probably one of the best ones ever" that will send the S&P 500 to 10,000 by the end of the decade.

10,000!

McCormick is even more bullish, arguing that the US is entering a "meta-bubble" of productivity and acceleration "that could spawn inflection bubbles for decades to come."

He means that in a good way: "The American Millennium starts now," he concludes.

Let's check the charts.

The American millennium so far:

US equities are up 2,100% since 1995 vs. just 411% for global equities (ex-US). Most of that outperformance has come in the last 15 years. It usually takes a bubble bursting, like the Nifty Fifty or the dotcoms, for that trend to reverse.

Even better:

The asset of the millennium thus far is gold, but mostly because the turn of the millennium happened to coincide with the peak of the dotcom boom. (Digital gold is not shown because it started in 2009 and it would break the chart, anyway.)

It's not just US mega tech:

This chart from John Authers debunks the notion that the US is outperforming only because the biggest tech companies happen to be domiciled there. Non-tech US equities are outperforming, too — a trend that accelerated after election day.

Still no landing in sight:

The Atlanta Fed's GDP Now model sees Q4 US GDP growth at 2.5%, still a long way from the recession that stubbornly refuses to occur. Ed Yardeni thinks we won't be landing anytime this decade even: "I don't think we're going to get a bear market [before 2030] simply because I don't think we'll have a recession," he told CNBC this week.

Re-accelerating:

US retail sales were better than expected in October, up 2.8% year-on-year. September's data was also revised upward. Stocks and bonds sold off on the news, suggesting good news is bad news again.

What changed?

A lot of people changed their mind about the economy on Nov. 6 — a reminder that you shouldn't listen to a lot of people about the economy.

As good as it gets?

Per the economist and perma-bear Albert Edwards, US companies have never been as profitable as they are right now. Edwards thinks this shows companies are benefiting at the cost of consumers. I think it shows companies are making things we want.

We want uncrustables:

Prediction markets aren't only for elections. They're also for telling us when to stock up on essential items before they get banned, like pre-made peanut butter and jelly sandwiches (with no crusts).

What a time to be alive.

Have a great weekend, accelerating readers.

— Byron Gilliam

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Maxfield on Banks @MaxfieldOnBanks

Why did Silvergate Bank fail?

I took a look into the failure of Silvergate Bank after coming across a line of argument, primarily in the cryptocurrency community, that Silvergate was forced into voluntary liquidation on March 8, 2023.

That Silvergate was forced into liquidation… x.com/i/web/status/1…

5:19 AM • Nov 13, 2024

287 Likes 53 Retweets

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