An Impact of AI You Might Not Like
Plus...XT, bitcoin and Ethereum ETFs: Ric answers a listener question
Ric Edelman: It's Tuesday, September 24th. Yesterday, I told you about some pretty cool progress in the world of AI. Today, I want to tell you about some pretty uncool threats about AI.
UPS has announced that they're cutting 12,000 office jobs because AI is now performing their tasks. BlackRock is laying off 600 people. Google fired its entire ad sales staff because AI is now doing the work. And IBM decided not to hire 7,800 people because AI can do the work instead. All told, Goldman Sachs says AI will automate the equivalent of 300 million full time jobs around the world by the end of this decade. So is it any surprise that in SEC filings, 56% of the Fortune 500, more than half of them, say AI is a risk to their businesses.
And it's not just more than half in some industries, it's a lot more than that in certain ones. In the media and entertainment industry, 90% of the Fortune 500 in those industries say that AI is a risk. 86% of software and technology companies. And of the 108 companies that specifically discussed AI in SEC filings, only 33 of them called AI an opportunity.
Yeah, they all say they can enjoy cost efficiencies and operational benefits and faster innovation, but they all say they're more worried that AI will simply put them out of business as consumers and customers find better, easier, and cheaper solutions elsewhere. Netflix says that competitors could gain an advantage over it by deploying AI, which would affect "our ability to compete effectively, and our results of operations could be adversely impacted”. Motorola said, “AI may not always operate as intended, and data sets may be insufficient or contain illegal, biased, harmful, or offensive information, which could negatively impact earnings and our reputation”.
Salesforce said its profit margins could be affected by uncertainty around emerging AI applications. Disney said AI could impact how it creates entertainment products, and the drug company Viagra said that AI could lead to the public disclosure of confidential information, either about the company's financials or the privacy of patients and their medical issues.
So yeah, yesterday AI is pretty cool. Today, AI is pretty concerning. You're going to have to decide which of the two outweighs the other.
Ric Edelman: I got a question from Robert. He's in Michigan, and here's what he asked.
Robert: I liked your strategy when you created the iShares Exponential Technologies ETF back in 2015. What's next?
Ric Edelman: Well, Robert, what's next is crypto. This is why I've been talking about crypto for the past several years. And in fact, my book, The Truth About Your Future, which was all about exponential technologies, and explained my story of creating the iShares exponential technologies ETF, symbol XT, which was at the time, the second most successful ETF launch in history and today remains one of the most successful ETFs in this sector of the marketplace.
It was all about the emerging technologies, which we now refer to as exponential technologies, and meaning exponential in their growth and development and, impact on not only the financial markets but virtually every aspect of life on the planet. That was in 2017 when I wrote the book, as you noted, the XT ETF, we launched back in 2015 and I wrote all about it in The Truth About Your Future two years later. It was all about AI robotics, big data, 3-D printing, bioinformatics, bionics, neuroscience, ag tech, ed tech, fin tech.
And there was one small chapter in that book on crypto back in 2017. Crypto was still far newer than it is today. And that led to my writing, my most recent book, The Truth About Crypto, which we released in 2021. So, what's next is crypto. Interestingly, crypto is one of the subsets of the broader category of exponential technologies and many of them are really ramping up.
You're hearing about these more and more in so many areas, most notably, recently, is Artificial Intelligence. That's really all the rage these days. What I have noted on this podcast is that AI and crypto are blending in many ways because the bitcoin mining operation, which consumes electricity, is comparable to the AI data centers, which also consume electricity. And the two together are becoming like chocolate and peanut butter, you know, two great things that work great together. So, what's next you already know…it's simply a matter of you acting on it the way you could have back in 2015 when I worked with BlackRock and Morningstar to launch the iShares exponential technologies ETF. You now have that opportunity with the new Bitcoin ETF and the Ethereum ETF. So that's not only what's next, it's frankly, what's already here.
You can send me your question as well, just send it to AskRic@The TruthAYF.com. The link is in the show notes.
Ric Edelman: Hey, be sure to join me tomorrow at 1:00pm EDT, for our webinar: Unlocking Alpha in Crypto-Equities and Beyond - Going beyond bitcoin and investing in publicly traded stocks of companies that are active in the crypto space. Chris Rhine, the Portfolio Manager and Head of Liquid Active Strategies at Galaxy Digital will be joining me for this fascinating conversation. We're going to talk about investing in crypto, not by buying Bitcoin but investing in the picks and shovels route, meaning buying stocks of companies that are in the crypto space, bitcoin miners, semiconductors, financial services firms, and a whole lot more. Really interesting investment opportunities and strategies for you to consider.
Check it out. It's tomorrow at 1:00pm EDT. You can get one CE credit if you're a financial advisor, the link is in the show notes. See you then.
I'm glad you're with me here on The Truth About Your Future. If you like what you're hearing, be sure to follow and subscribe to the show, wherever you get your podcasts, Apple, Spotify, YouTube, and remember leave a review on Apple podcasts. I read them all. Never miss an episode of The Truth About Your Future. Follow and subscribe on your favorite podcast app.
I'll see you tomorrow.
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Links from today’s show:
Ric’s bestseller - The Truth About Your Future: https://www.amazon.com/Truth-About-Your-Future-Money/dp/1501163817/
Ric’s bestseller - The Truth About Crypto: https://a.co/d/7PuAkTk
iShares exponential technologies ETF symbol XT: https://www.ishares.com/us/products/272532/ishares-exponential-technologies-etf
9/25 Webinar - Unlocking Alpha in Crypto-Equities and Beyond: https://dacfp.com/events/unlocking-alpha-in-crypto-equities-and-beyond
9/20 Webinar Replay - Q4 Crypto Outlook: What You Need to Know Now: https://dacfp.com/events/q4-crypto-outlook-what-you-need-to-know-now
9/11 Webinar Replay – Rates are Poised to Drop, Now What?: https://www.thetayf.com/pages/rates-poised-to-drop-now-what
Become Certified in Blockchain and Digital Assets: https://dacfp.com/certification/
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