“Low volatility and boring. That’s the mode that investors should get used to,” said Bill Gross, Managing Director at bond giant, PIMCO.
Artificial intelligence (AI) is one of the most transformative technologies of our time. It has the potential to revolutionize every industry, from healthcare to education, from finance to entertainment, from agriculture to defense. AI is already changing the world in many ways, and it will continue to do so in the next decade and beyond.
However, AI is not a cheap technology. It requires huge amounts of computing power and data-crunching to perform tasks that normally require human intelligence, such as reasoning, learning, decision making, perception, and natural language processing. To meet the growing demand for AI services and applications, Microsoft, the leading global cloud provider and AI innovator, has been investing billions of dollars in building and expanding its cloud capacity.
However, Microsoft faces two major challenges in its AI endeavors. The first challenge is the dependence on Nvidia, the dominant supplier of GPUs, which are the main hardware components used for AI training and inference. Nvidia has been unable to meet the high demand for GPUs, resulting in a shortage in supply and a surge in prices. This has increased the cost and reduced the profitability of Microsoft’s AI ventures.
The second challenge is the competition from other cloud and AI players, such as Amazon, Google, Alibaba, and Tencent, who have been developing their own custom AI chips to reduce their reliance on Nvidia and to gain an edge in the AI market. These companies have been offering their own AI platforms and services, which are powered by their own AI chips, to their cloud customers. These platforms and services provide state-of-the-art AI capabilities, such as machine learning, deep learning, natural language processing, computer vision, speech recognition, and generative AI.
To overcome these challenges, Microsoft has been developing its own AI chip solution, code named Maia, which is expected to be unveiled at its annual developer conference, Ignite 2024, in November. Maia is a custom-designed AI chip that will be used in Microsoft’s data center servers and also to power AI capabilities across its productivity apps, such as Office, Teams, and Dynamics. Maia will also be available as a service to Microsoft’s cloud customers, who will be able to use it to develop and deploy their own AI applications.
Maia is designed to be more affordable, efficient, and scalable than Nvidia’s GPUs, as well as more versatile and adaptable than other custom AI chips. Maia will be able to handle various types of AI workloads, such as image and video analysis, natural language processing, conversational interfaces, text-to-speech, speech-to-text, machine translation, and machine learning. Maia will also be able to support various AI frameworks and tools, such as TensorFlow, PyTorch, ONNX, and Azure Machine Learning.
Maia will leverage various techniques and technologies, such as:
- Heterogeneous computing: Maia will consist of multiple types of cores, such as CPU, GPU, and TPU, which will work together to optimize the performance and efficiency of different AI tasks.
- Neuromorphic computing: Maia will mimic the structure and function of the human brain, using artificial neurons and synapses, which will enable it to learn and adapt from data and feedback.
- Quantum computing: Maia will integrate quantum bits (qubits), which can exist in superposition of two states, which will enable it to perform parallel and probabilistic computations, which are essential for AI.
- Edge computing: Maia will be able to run AI tasks at the edge of the network, closer to the source of data and the user, which will reduce latency, bandwidth, and power consumption.
Maia will be a game-changer for Microsoft and its cloud customers, as it will enable them to leverage AI for creating value and gaining competitive advantage. Maia will also be a catalyst for AI innovation and democratization, as it will make AI more accessible and affordable to a wider range of users and developers. Maia will also be a driver for AI ethics and governance, as it will provide transparency and accountability for the decisions and actions of AI systems and solutions, as well as enable human understanding and trust of AI.
When John identifies a strategic exit point, he will send you an alert with specific trade information as to what security to sell, when to sell it, and at what price. Most often, it will be to TAKE PROFITS, but, on rare occasions, it will be to exercise a STOP LOSS at a predetermined price to adhere to strict risk management discipline. Read more
Mad Hedge Technology Letter
November 15, 2023
Fiat Lux
Featured Trade:
(CONSIDERING AT INVESTMENT IN FISKER THEN READ THIS)
(FSR), (TSLA)
Removing the Chief Accounting Officer and delaying earnings on the day of earnings is a massive red flag for EV start-up Fisker (FSR).
Fisker said in a filing that it “determined that it has material weaknesses in the company’s internal control over financial reporting.”
Hiring the wrong person for one of the most important jobs at the company only to realize on the day of an earnings report is more than bad optics, and it certainly means there is probably a lot worse going on under the hood.
The blood bath in FSR shares continues today with the stock cratering over 2% which is on the heels of a 21% drop on Tuesday.
Fisker CFO Geeta Gupta-Fisker said the company is cutting its 2023 production guidance to a range of 13,000-17,000 units to enable the company’s “global delivery and logistics platform to scale” and not sit on inventory. Fisker’s challenges with delivery resulted in 4,725 vehicles produced, but only 1,097 delivered.
FSR has continued to over-promise and deliver which creates a toxic recipe for lower stock prices.
After peaking at over $28 per share in the summer of 2021, the stock has done nothing but slide into the abyss.
CEO Henrik Fisker said customers were waiting a long time for their vehicles and were getting “annoyed.”
Fisker’s production forecast stood at 20,000-23,000 units, which itself was reduced from a prior forecast of 32,000-36,000 in May, and again from 42,400 earlier this year.
It’s only time until the EV company starts reducing its forecasts even more and this constant expectation of changing expectations is due to bad management.
FSR lost $91 million in the past quarter and only has a tick above half a billion in cash.
Doing some basic math, it means that FSR will burn through their existing cash in 5 quarters if they lose around the same amount of cash each quarter moving forward. If this happens, they will need to tap the corporate debt market and pay extortionate rates of something between 17% and 20% considering they have a high chance of filing for bankruptcy.
Readers should keep in mind that FSR doesn’t sell a cheap car.
It’s quite expensive which will make it even harder to scale.
That’s bad news for a start-up that only delivers about 1,000 cars per quarter.
Performance and management seem like they aren’t up to snuff and on paper, the company isn’t hitting the metrics it needs to be taken seriously by investors.
From a pricing point of view, Fisker made pricing adjustments for its lone Ocean SUV, cutting its top trim Ocean Extreme by $7,500 to $61,499.
Ultimately, I see FSR’s competitive position, or lack thereof exacerbating as we move forward.
I don’t see how they catch up with the heavyweights as it relates to many critical factors in running a successful EV firm.
Low-interest rates or something similar to them will not be back for a long time and perhaps never.
This new rate environment doesn’t favor the start-ups the ones that already “made it” in a low-rate environment of the past.
FSR makes a good car, but not to the point where buyers will pass up other cheaper options.
If FSR is struggling to deliver more than 1,000 cars per quarter, it bodes ill for repeat purchases after so many buyers are waiting for cars that should have already been delivered.
Management not understanding the logistics of the situation is hard to fathom in 2023.
They might want to pick up the phone and call around to see what is going on.
If a buyer spends more than $70,000 for an EV from an untested brand like FSR, better get the car there on time.
There is a reason why Tesla (TSLA) just caught a bid and shares went up 18% and the stock has doubled this year and it’s not because they have trouble delivering 1,000 cars.
I’ll take a hard pass on FSR for right now.
“My goal was never to make Facebook cool. I am not a cool person.” – Said Co-Founder and CEO of Facebook Mark Zuckerberg
(THE WEARABLE AI IS HERE)
November 15, 2023
Hello everyone,
The Ai Pin is here. Anyone for a wearable AI this Christmas?
Start-Up Company Name: Humane
Price: $699 + $24 monthly data subscription to T-Mobile. Subscription includes a cell phone number, unlimited talk, text, and data.
When available: Orders can start from November 16.
Founders: Imran Chaudhri and Bethany Bongiorno (former Apple designers).
Design: Smartphone alternative, but it doesn’t have a screen.
Choice of three colors: eclipse (black), equinox (black and white), and lunar (white).
Two-piece design – main computer and a battery booster – magnetically connected and can be powered through clothing.
Features: make calls, send texts, access information through voice controls.
The Laser display can project information such as time and date onto the user’s palm.
Built-in speaker and camera. Double-tap on the device to take a photo or video. View them on Humane’s web app.
Can translate spoken English and Spanish conversations.
Collaboration: Humane has collaborated with companies such as Microsoft.
Launch statement: Open AI “gives the AI Pin access to some of the world’s most powerful AI models and platforms.”
ROBOTS TO THE RESCUE ON THE REEF
An Australian scientist is using the power of robots to regrow the threatened Great Barrier Reef, which is in a lot of trouble because of climate change.
50% of corals have been lost worldwide and the outlook appears grim. 70%-90% could be lost under climate change.
Dr. Taryn Foster, a marine biologist is cultivating coral from limestone, which is coral’s natural skeleton. Fragments of coral harvested from the ocean are glued onto plugs, which are then inserted into the limestone base. The whole skeleton is then planted in the ocean. Foster argues that this process bypasses several years of calcification to get to adult size by providing them with a premade skeleton.
Foster’s company Coral Maker has teamed up with AI business Autodesk. Robots will be doing the repetitive tasks. Foster’s goal is to mass-produce millions or tens of millions of corals every year to restore threatened reefs right across the world.
More coral bleaching is predicted in Australia this coming summer. Foster points out that more than 800,000 species are supported by coral reefs. Letting them disappear is not an option in Foster’s mind.
If you ever visit Australia, make sure the Great Barrier Reef is on your list of sights to see. The islands dotted off the coast of Australia in this area are truly stunning and deserve to be added to your travel schedule. The natural beauty of the landscape, the crystal-clear warm waters, the warm sunshine, and the welcoming locals are all a treat just waiting for you to enjoy.
Great Barrier Reef suffered the worst coral die-off on record in 2016.
Snorkeling on the Great Barrier Reef
Cheers,
Jacquie
Global Market Comments
November 15, 2023
Fiat Lux
Featured Trade:
(TESTIMONIAL),
(THE IRS LETTER YOU SHOULD DREAD),
(PANW), (CSCO), (FEYE),
(CYBR), (CHKP), (HACK), (SNE)
2023 is going to end extremely well, thanks to the help of JT!
The year started great with almost 15% gains in a few days in January. Then more profits along the way. When it was time to sit in cash, John strongly advised that and to go enjoy the outdoors.
During these past two weeks, he was back at it sending out alerts, all of which have worked out and provided a nice profit-taking day today. The (GOOGL) alert yesterday tops the recent list. It took just two market hours (plus the overnight hold) to make 80% of the maximum potential profit.
Last week, it was a real problem keeping up with him while skiing Breckenridge. It's a good problem to have, but I did manage to get into all the positions with my cell phone and enjoy the snow.
Trade well.
Bob from Colorado
“Your most unhappy customers are your greatest source of learning.” – Said American Health Expert Bill Gates
