MICRO-DOSE, MACRO PROFITS
(CMPS), (MNMD), (ATAI), (GOOGL), (MSFT), (AI), (NVDA), (ADBE)
As we celebrate our nation's independence this week, I've stumbled upon a fusion that's more explosive than my Aunt Mildred's famous five-alarm chili.
I’m talking about microdosing and artificial intelligence – two fields that, at first glance, have about as much in common as a Wall Street trader and a Woodstock attendee. Now, I've seen more market trends than I've had hot dogs at July 4th barbecues, but this one's got me intrigued.
Microdosing, for the uninitiated, is like giving your brain a soft reboot – not the full "turn it off and on again" that most of us need on Monday mornings. It's taking tiny doses of psychedelics, presumably to boost creativity. However, if you ask me, nothing boosts creativity quite like staring at a sea of red in your portfolio.
But here's where it gets as wild as my hair after a flight in my old Cessna: The big brains in Silicon Valley are thinking that AI could benefit from a little "microdosing," too.
They're suggesting that AI "hallucinations" - those quirky outputs that usually make about as much sense as congressional budgets - might actually be the secret recipe behind machine creativity. Even OpenAI's Sam Altman is hopping on this bandwagon.
The numbers are enough to make you feel like you've accidentally doubled your microdose. The psychedelic market is projected to hit $10.75 billion by 2027, while the AI market could reach a brain-melting $1.59 trillion by 2030. That's more zeros than I see in my brokerage account, even on a good day. And get this: the AI market is expected to grow faster than a teenager's shoe size, with a CAGR of 37.3% from 2023 to 2030.
So, who's leading this parade? We've got Compass Pathways (CMPS), MindMed (MNMD), and ATAI Life Sciences (ATAI) in the psychedelic corner, their stock charts looking like they've been drawn by someone on an actual trip.
On the AI side, there's Nvidia (NVDA), whose chips are hotter than the grill at your cookout this week. Their Q2 2024 revenue jumped 101% year-over-year – needles to say, that's growth that'll make your sparklers look dim.
Meanwhile, Alphabet (GOOGL) and Microsoft (MSFT) have been throwing more money at AI than a drunken sailor at his first rodeo.
Google's parent company invested a whopping $31.5 billion in AI R&D in 2023 alone. As for Microsoft, it’s not just twiddling its thumbs. Their Intelligent Cloud segment, which includes Azure AI, raked in $67.6 billion in 2023.
Let's also not forget the little firecrackers like C3.ai (AI) and Adobe (ADBE). C3.ai lit up the scene with a 38% revenue increase in fiscal year 2023, hitting $308 million. Adobe's cooking up a storm too, with $17.61 billion in revenue for fiscal year 2023.
Now, before you start throwing money at these stocks, remember: this is riskier than trying to steal a hot dog from a hungry bear. For one, the regulatory landscape is murky. You know how the fun police always show up just when the party's getting good? Well, guess what? As AI gets smarter than a whip and starts cranking out creative content like a patriotic anthem factory, the regulators are gonna come knocking faster than neighbors complaining about loud fireworks.
Then, there’s the possibility that these AI "hallucinations" could be more unpredictable than my Cousin Vinny after his third martini. There's a chance these digital daydreams could cook up content more misleading than a politician's campaign promise.
The bottom line is this: investing in AI is like planting a tree – you won't be enjoying the shade tomorrow. But this cocktail of AI and microdosing? It could be the Boston Tea Party of investments – risky, revolutionary, and with the potential for immense rewards. Or, it could fizzle out like a misfired bottle rocket.
Either way, it's shaping up to be one hell of a spectacle. I say we add these companies to our watchlist and wait for more updates. We wouldn't want to miss out on the main event, would we?
