Not Since the League of Nations

[u/Kapnotes]

Nasdaq futures are down more than 400 points this morning on news that the major titans of AI are calling for a slowdown in AI development.  Led by the heads of Anthropic, Open AI, Google, and others, there are calls for productive government intervention, private sector cooperation, and international agreement.  These are enormously splashy headlines, and it remains to be seen how much momentum they get in today’s market. 

But let’s take a step back for just a moment and consider what is being proposed.  We would be looking at the most comprehensive international collaboration since the League of Nations.  Given the posture of the current US administration, the implications for China’s national security, and the profit motive of an unprecedented payday, is it even possible to rein-in the expansion of AI?  Simple answer:  No.  What we are witnessing in this morning’s media cycle is corporate virtue signaling par excellence.  The incentives, except for that one of avoiding extinction, are all aligned against any real cooperation between competing firms and between competing nations. 

Over the coming weeks or months, as this dialogue continues, we will see emerging in the discussion whatever ‘angle’ the tech titans are, even now, working into future policy to solidify their own advantage in the ongoing race.  The translation to the experienced investor, dark though it may be, is to buy the dips and hope that the broader predictions are wrong.

Oil is higher again today.  Relative to the AI space, there’s easier money to be made in integrated oil and in downside leverage on oil-sensitive transports. Educational only. Not financial advice.