"If horses could have voted, there never would have been cars," said my friend, Tom Friedman, a columnist at the New York Times.
Toronto, Canada - RBC, a leading global financial institution, has released its highly anticipated Global Insight 2025 Outlook report, providing a comprehensive analysis of the economic, financial, and geopolitical trends that are expected to shape the world in the coming years. The report highlights the profound impact of artificial intelligence (AI) across various sectors, emphasizing the need for investors and businesses to adapt to this rapidly evolving landscape.
AI: The Defining Technology of Our Time
RBC's report identifies AI as the most transformative technology of the 21st century, with the potential to revolutionize industries, redefine business models, and reshape the global economy. The report emphasizes that AI is no longer a futuristic concept, but a present-day reality that is already impacting our lives in numerous ways.
"AI is not just a technological advancement; it's a fundamental shift that is reshaping the world as we know it," says Helen Zhang, Head of Global Insight at RBC. "Its impact will be felt across all sectors, from healthcare and finance to manufacturing and transportation. Businesses and investors who fail to grasp the implications of AI risk being left behind."
AI's Impact on the Global Economy
RBC's report predicts that AI will be a key driver of economic growth in the coming years, boosting productivity, creating new jobs, and unlocking new opportunities. The report estimates that AI could contribute up to $15.7 trillion to the global economy by 2030.
However, the report also acknowledges the potential challenges associated with AI, including job displacement, ethical concerns, and the risk of widening inequality. RBC stresses the importance of responsible AI development and deployment, ensuring that its benefits are shared broadly and its risks are mitigated.
AI and the Future of Work
The report delves into the impact of AI on the workforce, acknowledging that while AI will create new jobs, it will also displace existing ones. RBC emphasizes the need for workers to adapt to this changing landscape by acquiring new skills and embracing lifelong learning.
"The future of work will be shaped by AI, and those who are prepared to adapt will thrive," says Zhang. "We need to invest in education and training programs that equip workers with the skills they need to succeed in an AI-powered world."
AI in Key Sectors
RBC's report provides a detailed analysis of AI's impact on various sectors, including:
- Healthcare: AI is transforming healthcare by enabling earlier disease detection, personalized treatments, and more efficient drug discovery.
- Finance: AI is being used to automate tasks, detect fraud, and provide personalized financial advice.
- Manufacturing: AI is optimizing production processes, improving quality control, and enabling predictive maintenance.
- Transportation: AI is powering autonomous vehicles, optimizing logistics, and improving traffic flow.
Investing in the Age of AI
RBC's report provides guidance for investors on how to navigate the AI landscape, highlighting the opportunities and risks associated with this transformative technology. The report identifies key investment themes, including:
- AI infrastructure: Companies that provide the hardware and software necessary for AI development and deployment.
- AI applications: Companies that develop and apply AI solutions across various industries.
- AI enablers: Companies that provide services and technologies that support AI development and adoption.
RBC's Commitment to AI
RBC is committed to harnessing the power of AI to enhance its products and services, improve its operations, and create value for its clients. The bank has made significant investments in AI research and development, and is actively exploring new ways to leverage AI across its business.
"We believe that AI has the potential to transform the financial industry, and we are committed to being at the forefront of this transformation," says Zhang. "We are investing in AI to provide our clients with more personalized and innovative solutions, and to make our operations more efficient and secure."
Conclusion
RBC's Global Insight 2025 Outlook provides a comprehensive and insightful analysis of the trends that will shape the world in the coming years. The report highlights the transformative potential of AI, while also acknowledging the challenges and risks associated with this technology. RBC's commitment to responsible AI development and deployment, coupled with its investments in AI research and development, position the bank as a leader in the AI revolution.
Mad Hedge Technology Letter
December 23, 2024
Fiat Lux
Featured Trade:
(THE FUTURE IS HERE)
(NO CODE)
The future is here.
No code or low code will bring a raft of new innovative tech companies to market, and we are in the early innings of this transformative development.
What is no code?
No-code is an approach to designing and using applications that requires zero coding or knowledge of programming languages.
This type of software hits us at a perfect time when the home office is beginning to become ubiquitous.
The self-service movement that empowers business users will support the creation, manipulation, and employment of data-driven applications.
If we turn back the pages of history, companies need an army of software programmers to develop even the measliest application.
That was then, and this is now.
Fast forward to today, and automated technology doesn’t only include cutting-edge industries like automotive cars, but also software on laptops that can be rejigged by individual entrepreneurs.
That’s right, one person with no coding experience will be able to design, develop, and offer a real-life application with meaningful business value without the help of expert programmers.
The research data backs up my thesis with research firms projecting a 23% increase for the global market for this type of technology.
During the pandemic, low-code/no-code tools saw steady growth due to their effectiveness in addressing some of tech’s most complicated challenges.
The essential need to digitize workflows to enhance customer and employee experiences will be a boost to the efficiency of commercial and operational teams.
No-code platforms have evolved from just facilitating mundane tasks to making it possible for a broader range of business employees to truly own their automation and build new software applications with no coding while increasing organizational capacity.
A few risks that larger companies might consider is that even for remote developers building new applications, governance is paramount.
IT staff will need to install guardrails in place and have those built into low-code/no-code platforms to maintain consistent levels of security across the organization.
Cybersecurity solutions need to be integrated into this workflow by training every employee at the organization on security behavior and using compartmentalization and limited access to prevent opportunities for mistakes.
Hard landings are hard to recover from, and some can be crippling to the business model.
For no-code companies, harmonizing workflows is a key requirement for success.
In a low-code/no-code organization, departments should be able to work without silos and communicate freely across functions.
Elevated performance enabled by low-code/no-code tools will mean that the number of useful apps hurling towards the marketplace will be more and merrier than ever before.
Higher performance will no doubt usher in a new renaissance of efficiency and even better performance.
This also puts a 3 or even 4-day workweek squarely in play.
Many of the best tech minds in the world have supported the concept of working smarter instead of working harder.
A low code/no-code standard will allow for these achievements to take place.
The cratering of costs to start and run a tech firm is affected, too.
Deploying startup capital to pay for other expenses will make it easier for successful incubation.
This will ultimately mean that this new type of tech company will need to embrace the fusion of IT and business staff, empowering them with composable applications to speed up the time to market for new solutions.
Low-code/no-code APIs and other tools are enabling companies to integrate new applications into their existing tech stack in a more seamless manner with a lift-and-shift approach vs a rip-and-replace.
At the entrepreneur level, individuals will be able to harness the technology to build $100 million companies with a snap of the fingers when it wasn’t possible to do it before.
This is finally a chance for the little guy to recapture their moxie in the vast and sometimes overwhelming business world.
“If you're not stubborn, you'll give up on experiments too soon.” – Said Founder of Amazon Jeff Bezos
(SENSIBLE INVESTING TIPS BY BUFFETT TO START THE NEW YEAR)
December 23, 2024
Hello everyone,
While I am taking a break, you will receive past Posts, which you may or may not have read.
Enjoy the festive season.
*************************************************************************************
I want to sink into your psyche today some investing advice by Buffett. You would do well to write these on a piece of paper and stick that on the wall above your computer or your desk and read it every day.
We might know the hard and fast rules of investing, but life has a habit of tipping the scales sometimes, where we temporarily lose our balance and are not thinking clearly, and these are the times we sometimes slip up in our ability to stick to the plan and the rules.
So, let’s jump into those tips.
1. Design a broad portfolio. The goal of the non-professional investor is not to pick winners – but rather own a cross-section of businesses that, in the aggregate, are bound to do well. This is why Buffett always advises investors to invest in a low-cost S&P 500 index fund, which will achieve this goal. He suggests checking out Vanguard. Interestingly, Buffett revealed 10 years ago that he would direct 10% of the cash to go into short-term government bonds and 90% to a low-cost S&P500 index fund.
2. Steer clear of the financial salesperson. Professional money managers and advisors (on Wall Street or indeed anywhere) are incentivized to recommend various securities. The fact is that they rarely beat the market. Buffett’s words here: “You just have to recognize you’re dealing with an industry where it pays to be a great salesperson…There’s a lot more money in selling than in managing…if you look to the essence of investment management.” (I learned this lesson the hard way and am now very wary). And please note that more than 95% of financial newsletters are rubbish, written by people with no investing experience.
3. You don’t need to be a Math genius. Buffett says you don’t need to excel at technical analysis or mathematical calculations to find great stocks. Buffett comments that “if you need to use a computer or a calculator to make the calculation, you shouldn’t buy it” (the stock).
4. When you buy a stock, you own part of the business. Buffett only buys something when he grasps the intrinsic value of an asset or the discounted value today of the cash that a business generates in the future.
5. Market action is largely driven by emotions. Fear and greed should guide investors on when to buy and sell. Buy when there is fear and sell when there is greed. Simple as that. (For long-term investors, just average in and stick the investment in the bottom compartment of your cupboard). Buffett reminds us of the fact that math and a high IQ don’t necessarily help. So, leave the ego boxed up if you topped your class in Math – it may get in the way here... Buffett’s words: “Higher mathematics may be dangerous, and it will lead you down pathways that are better left untrod.” He goes on to remind us that “we do not sit with spreadsheets…we just see something that obviously is better than anything else around, that we understand. And then we act.”
6. After a loss, move on. Look forward. No extra detail is needed here.
7. Steer clear of declining businesses. When Buffett started on his investing journey, he used to buy cheap, failing businesses that he called “cigar butts.” But that strategy is not beneficial in the long run. Real money is going to be made by being in growing businesses, and that’s where the focus should be. Buffett is now known for seeking out wonderful businesses that he could buy at fair prices. He transformed Berkshire Hathaway from a small, failing textile mill into a near-$800 billion multifaceted juggernaut.
Cheers,
Jacquie
Global Market Comments
December 23, 2024
Fiat Lux
Featured Trade:
(A BUY WRITE PRIMER)
(AAPL)
(MSFT), (NVDA), (UBER), (AMD), (INTC), (QCOM), (TSM), (GOOGL)
I have always been a sucker for the small fish that big sharks circle around, especially when those sharks have names like NVIDIA (NVDA) and Uber (UBER). Believe me, after all these decades swimming in the turbulent waters of the hedge fund world, you learn to pay attention to who sidles up to whom.
So when NVIDIA, which controls roughly 80% of the AI chip market and has sent record revenue zinging through its data center division, and Uber, the swaggering king of ride-sharing with a solid 76% market share, both take a shine to a tiny AI startup, I start sniffing around. And I mean really sniffing around.
It’s like looking at a painting’s back corners instead of just the center – that’s where you find the real brushstrokes and hidden signatures. Remember, NVIDIA and Uber aren’t the sort of outfits that drop their change in a random tip jar.
They’re placing bets on a startup that’s fiddling with real-time edge computing. Think rapid-fire data processing right where the action is, no waiting for some distant server to give a nod.
They’re doing it now, quietly, and if that doesn’t catch your attention, nothing will.
Look, I can almost hear you muttering: “Why care about the kid in the corner when you’ve got NVIDIA’s big top show dominating the AI scene?” Remember, Microsoft (MSFT) purchased a staggering 485,000 of NVIDIA’s Hopper AI chips in 2024 alone.
That’s more than double what other US and Chinese competitors managed to grab. If that doesn’t underline NVIDIA’s chokehold on supply, what does?
Uber, which has pumped over $1 billion since 2015 into making cars steer themselves and optimize logistics, clearly plans for a future when autonomous everything is as common as a traffic jam in Manhattan. Linking up with this under-the-radar AI whiz kid might give Uber more finely tuned algorithms, more efficient fleets, and a fatter bottom line.
Still, there’s a lot of chatter right now. Everyone’s yapping about AI as if it’s the cure for every market hangover.
So let’s sink our teeth into something more satisfying: the numbers. The AI chip market, valued at about $53.7 billion in 2023, is expected to top $71 billion in 2024.
Meanwhile, the global autonomous vehicle market, already a hulking $1,500.3 billion in 2022, is forecast to explode to $13,632.4 billion by 2030. That’s a compound annual growth rate of 32.3%.
The direction is screamingly obvious. Everyone, including NVIDIA and Uber, wants a piece.
Their quiet investment in this tiny startup is a subtle tip-off that something big is percolating just beneath the surface.
I’m no stranger to turning over stones others ignore. Over the years, I’ve watched AMD (AMD) and Intel (INTC) spar behind the scenes.
AMD holds an 11% share of the data center AI chip market—tiny next to NVIDIA, yet not negligible. Intel, with a 22% chunk, tries to catch a train that’s already leaving the station.
Qualcomm (QCOM) works the edges with mobile processors and real-time capabilities but doesn’t challenge NVIDIA’s core dominance. TSMC (TSM) quietly churns out the silicon that keeps everyone’s ambitions alive.
Alphabet (GOOGL) and Microsoft, meanwhile, drive demand through software and R&D, pushing everyone toward more powerful chips. All that said, none of these players truly compare to NVIDIA’s entrenched position.
That’s what makes this move with Uber so telling. No one said the race would be tidy.
Companies bump elbows and occasionally whisper sweet nothings into a promising startup’s ear. NVIDIA wouldn’t bother unless it foresaw future profits.
Uber wouldn’t team up unless it sensed this tech could improve its bottom line.
I’ve seen this before. Early believers in a small disruptor can reap big rewards while skeptics mutter into their coffee.
This could be another one of those moments. For those who like to keep their fingers on the pulse, NVIDIA's position is so dominant that I'd still call it a buy.
AMD is worth picking up too, considering it's stubbornly carving out territory. Intel might need to show us more before getting a seat at the table.
TSMC is the machine that keeps the AI train rolling, making it a buy for anyone with a penchant for stable back-end players. Alphabet and Microsoft, both deeply committed to AI research and application, look like buys as well.
Uber, for all its ambition, stays at hold. I love the swagger, but let's see if it can turn these investments into real profits.
I’ve seen this story before. Early believers in small disruptors can reap big rewards while skeptics mutter into their coffee.
Sometimes the tastiest morsels come from watching which small fish the giants eye for dinner. And this little AI startup? It just might be the plankton that feeds the whales.
Mad Hedge Technology Letter
December 20, 2024
Fiat Lux
Featured Trade:
(BUYER BEWARE)
(TIKTOK)
Sometimes, the best way to become successful at investing in technology stocks is to avoid the black swan or the big disaster.
I hate to say it, but investment risk has never been higher as we migrate our lives to the internet to extract what we need from personal to business affairs.
One question that keeps getting rehashed that I thought I might take time to address is the rise of the TikTok influencer-adviser.
According to a brief Google search, TikTok, known in China as Douyin, is a video-sharing social networking service owned by Chinese company ByteDance.
The social media platform is used to make a variety of short-form videos from genres like dance, comedy, and education that have a duration from three seconds to one minute.
Unfortunately, for serious retail investors lately, content has migrated into high-stakes themes like financial education and financial advising, giving rise to content that is produced by video creators to get a piece of the financial industry.
Naturally, this has brought down the quality of the financial content on the internet to historic lows simply because most of the content is marginal at best.
These promulgators often preach about their status as “trading gurus” and often leverage the hype of digital currencies to claim they are fully invested in “crypto assets” and urge anyone reading to become one of their new “cult followers.”
They are also usually paid to market a “bulletproof” financial app or certain crypto asset to avid followers without properly disclosing that they are being paid for the advertisement.
This behavior is being encouraged by the TikTok algorithms, who order this type of misleading content at the top of searches simply because it gets more hits being a click-bait type of content.
The more outlandish the videos become, gloating about get-rich-quick schemes and 1,000% daily returns, the higher up in the search queries they usually populate when filtered through TikTok algorithms.
These accounts are known as financial “influencers” and post 100s of such videos every month featuring fraudulent success or minimizing the difficulty of profiting through trading and a mix or mash of everything in between.
Even some proclaim to have unlocked the holy grail of trading and “guarantee” 100% returns or your money back.
Another speaking point they like to touch on is how video watchers can “also” afford wealthy lifestyles without having to work, at least in the traditional way.
To dumb down the travails of investing and trading to something easier than pouring a glass of water is a lie.
Many of these novice investors are duped into paying for exorbitant services that are nothing more than promotional buzz offering hyped-up marketing language as specific trading advice.
Unfortunately, US regulators have turned a blind eye to what is happening on this nefarious Chinese platform, and imitators are spawned daily and are certainly incentivized to do so.
While I must admit that regulating this type of behavior on TikTok is incredibly messy, to leave this unchecked will result in massive fraud for the little guy that I try to help.
I will say the main reason for ignoring these TikTok “influencers” is because there is even worse cybercrime taking place out there, and the content these influencers are peddling is straddling the gray areas of the law.
The digital migration during Covid has created a tsunami of fresh cybercrime that is really making the TikTok gurus look like choir boys.
Here are some statistics to stew over, according to Gartner research.
- 88% of organizations worldwide experienced spear-phishing attempts in 2023.
- 68% of business leaders feel their cybersecurity risks are increasing in 2023.
- On average, only 5% of companies’ folders are properly protected in 2023.
- Data breaches exposed 36 billion records in the first half of 2023.
- 86% of breaches were financially motivated, and 10% were motivated by espionage in 2023.
- 45% of breaches featured hacking, 17% involved malware, and 22% involved phishing in 2023.
When digital professionals went remote, this also increased the risk of cybercriminals wreaking havoc by isolating their targets.
In the grand scheme of the internet, the TikTok trading “gurus” are small fish to fry when hackers are attempting to topple state of federal governments and Fortune 500 companies, yet that doesn’t make it okay.
The Financial Conduct Authority (FCA) is already looking into trading scams and considering ramping up its capacity to monitor those TikTok creators and others who are flogging trading signals, managed investment services, or other fraudulent services.
But it’s not enough, and readers need to understand the heightened risks of diving feet-first into these TikTok polar vortexes where you just get whipped around unknowingly.
Pre-emptively protect your portfolio by avoiding these TikTok trading gurus is the order of the day.
Stay vigilant and happy trading, and just know there is no holy grail of trading.
It’s hard work earning your crust of bread.
BUYER BEWARE