The Last Economy: Predicting the AI-Driven World

26:48When I say expressed like that, it means you can start from that basic equation of this is minimizing loss, the difference, and derive the Cobb-Douglas function or derive Black Skulls or anything mathematically. So basically, we're A-B testing everything instantaneously via neural network. We are AIs, and the economy is an AI, and organizations are AI. Yeah, I agree. And the way that we've had it in terms of compressing books and all of this stuff is very lossy in our outputs. When really what we're trying to do is just update our weights. We're trying to fine tune constantly. And again, you look at reinforcement learning with human feedback.

27:30What do organizations do except for optimize and over optimize? You know, what do we do as humans? What's our objective function? It's actually all the same thing, which is kind of crazy. and the fact that we could take all of human knowledge or maybe say wisdom, because what's the difference between data information, data knowledge and data information, knowledge and wisdom. When you've got data, it's like all this. When you have wisdom, it's like that, right? So what you've learned through experience. These are wisdom models, right? They are the folded principles and they are the investment processes and the life processes.

28:05And that's how they can get so small. A lot of people suggest that the speed of the increased intelligence is slowing down. I don't believe that. How do you think about this? Or do we just keep going? It's slowing down because it's saturating. There's this company called METR that does analyses of all these things. They take all of the evaluation metrics. They see how long a piece of work an AI model can do. and according to every single benchmark, we will saturate every benchmark by 2027. Like we built a medical model. We released this summer. We've been pretty quiet about everything. We would have to make a big deal.

28:46Like we haven't even put out the economics paper properly and other things like that. Get quiet. 8 billion parameters. It runs on a Raspberry Pi. If you score it on the medical benchmarks, it's like four gigabytes. a human doctor is 20 % on health bench, which is open AI's benchmark. Our model is 48%. The best model in the market is 60%.

29:13And so you look at that and you're like, wait, what? It's already better than any human doctor across 500 different evaluations. That's a couple of gigabytes big, but that means it's saturated. Like, are we going to get to 100 %? No, we'll get to 70 % and then you can't do any better. If you've got a gold in the International Math Olympiad, how much better do you want? You know, like multi-step processes, like doing your taxes and other stuff. Like if you trade crypto, where is the AI that can do your crypto taxes? It is three to six months away. And once it does that, it will make less errors than any human.

29:51I mean, human accountants make errors all the time. Doctors, 20 % of diagnoses are errors. Once these get going, they won't make any errors. So all the benchmarks are saturating. And again, sure, Elon might do a million GPU training run or Anthropic will. And that might be a genius Einstein. It won't do my taxes. I'll use the model that costs a million bucks to trade to do my taxes. And so you've got this bifurcation occurring. And in fact, GPT-5 was the first example of that. It wasn't their best model. Their best model was the one that could score the gold medal in the International Math Olympiad.

30:31But they gave us a model that was good enough and cheap. It was 10 times cheaper than the model last year. It's$10 per million tokens. But then, like I said, there was a bit of a surprise in that XAI suddenly released one that was 20 times cheaper. Have you ever seen that, right? It's like an entire, like a bunch of AI immigrants coming, you know, sorry for the politics, that will work 20 times cheaper. What does that do to any economy? And next year, it'll be 10 times cheaper than that. And next year, it'll be 10 times cheaper than that. And so it's now up to us to use the technology to drive productivity increases at a dramatic scale.

31:11But are we even ready to do that yet? Some people are, though. So I guess that the private markets win, right? Right now, I say a month or two ago, if you're like an early adopter, you were using AI by prompting synchronously. So you were still constrained by you. Now the AI models have gone from minutes to hours of independent work. I saw Sam Altman saying they think they'll get to seven days shortly. If you can get to seven days, you get to 70 days. Again, you check each other's work. What they did is they added a verifier. They added the ability for these things to... So then what happens is this.

31:52your capability in competitive environments becomes your GPU availability for a while. So when I see OpenAI saying 200 billion of revenue and 100 billion as agents, I'm like, that's replacing the workforce for anything on the other side of a mouse. When I see they don't talk to Hollywood anymore, I'm like, because they'll make their own movies. That's how I see these big guys kind of going. Like they're going to go after a bigger sector because because ChatGPT costs$20 a month, over$20 a month to run. So they get upstream and downstream of all of this by essentially creating all the output with their own models.

32:28So whether it's Hollywood, whether it's media, whatever it is. Why would you give it away, right? I mean, this is what MacroHard is, Elon Musk's new software company. Yeah, what is MacroHard? I'm trying to figure that out. It's a full-stack SaaS replacement. For what? Everything? everything. He's going to recreate all software on his millions of GPUs. And they're going to call up and do the sales and they're going to do the customer service, everything on the GPUs. It's a play on Microsoft, obviously, but that's what he's doing with MacroHard. I've now just realized it's just the opposite of Microsoft is MacroHard.

33:06He's a good namer. You have to give him that, right? The boring company, you know, all this kind of other stuff. I mean, it's staggering. Do we run out of data? Or is the reinforcement learning and the neural network just allow it to just keep expanding its own knowledge? It doesn't need more data. Think about it, Raul. You now versus 20 years ago. Yeah. Right. How much does each incremental piece of data make you better? Not much, because you've learned the principles. Yeah. Once you've got the models to a certain level of performance, you don't need any more data. They're a few short learners.

33:45Yeah, because what you're doing is you're using then the intellectual framework to then scale your own knowledge and understanding. And you don't need to be given every piece of truth, whatever it is, or every piece of data to do that. You use pattern recognition. That's exactly the language models. The original paper for GPT-3 was called Large Language Models Are Few-Shot Learners. So they build their principles, their investment process, their life process, their driving process, their painting or video making process. You give them a few little bits. And that's all they need because they've built those already.

34:27It's like nano banana if you've ever used that, right? It's so good at transforming you now. Just with one image, it can do everything. or if you saw two it's like here's me and here's me like on a dragon in the middle of nowhere in like two seconds like what is that so a quick break in your regular programming if you're serious about your future grab my free report called prepare for 2030 i think you've got five years to make as much money as possible and this guide will help you navigate what's coming the link is in the description download it now somebody said an interesting observation about Sora too, they said, it's pretty obvious what they're doing here is preparing people to have their own video AI.

35:10So then it's my AI and your AI chatting. You know, we just say, hey, go and have a fantastic conversation with them at pick his brains and everything. And it just, it's our AI. That's what Sora is allowing to happen. Completely. Because again, OpenAI's big mission is to create a digital twin of you that can replace you or you can pay them and it can represent you, right? The other thing that they have is what's scarce in this world when cognitive labor goes to zero, like basically pennies, attention, attention, human attention is scarce. So so Elon Musk, so opening, I'm going to do 10 billion of revenue this year.

35:55Video games industry is 200 billion. Elon Musk is launching a video games company. He just, replied to me today saying, yeah, it's like, because I like video games. Also because it's a huge market, right? And he builds stuff he loves and then other people do it too. It makes sense. They're going after our attention economy and then other things become valuable. Like what scarce Bitcoin, you know, we have our version of Bitcoin coming. Like there are just very few things, NFTs, like what is scarce in a world of abundance? And you need an abundance economics versus a scarcity economics to fill that.

36:25But this transition period is going to be crazy man like but how is society gonna deal with it because what what's in my head is we get compression of people don't hire new workers that's where we'll start to see the margin we're already seeing that in the data actually we saw that in duolingo they said we're not firing anyone but they're growing at 40 so all the high growth companies have stopped hiring but the firings haven't started yet like you see in eric brunson's data they've stopped hiring graduates but the The firing is when it started because you don't want to fire your buddies until recession.

36:59I was speaking to somebody yesterday, and they're in the electricity distribution business. It's got tens of thousands of people working here in Texas. And I said, what are you doing with AI? He said, we have to be very careful because we can't tell people we're going to replace them. So what we can do is grow and not hire new workers. So the productivity of companies goes up. But in the time, over time, the companies themselves are just AI. So in which case, it accrues to what? These are economic entities that, how does that operate? Well, the capital, again, what does the Fed do? The Fed has inflation and unemployment, right?

37:36As it's two levers. Yeah. So what happens is you cut rates and then banks can lend more credit and then companies can borrow cheaper and hire more workers. And that's doing the economy. You cut rates, companies go and buy more GPUs. You know, what happens then? I mean, economic growth basically right now is government spending plus data center buildouts. I mean, it's not happening in the rest of the sector. Well, this is my take on why digital assets are too legal now. They've gone from being completely illegal pretty much to being far too legal because the governments need to increase monetary velocity.

38:12M2 is terrible in the US. It's terrible around the rest of the world. It's not going to get better with this tidal wave that's coming. So again, like there was just so much stuff that's literally coming. And the equation is really interesting. Like when ChatGPT came out, all head teachers in the world had to ask, can I set essays for homework? All of them. Now, next year, reasonable chance for a recession. Every company will say, do I need to rehire the workers that I fire? You know, my competitor, if I'm fully digital, is now they're fully digital. How do I compete? I have to let go of people.

38:49I have to reduce my fixed costs. If you're in France, you're screwed because you can never fire anyone, right? And also an AI is not a fixed cost. It's like a freelancer. So you don't have to pay you for the amount of work you use it for. Yeah, AI is a tax deductible. Like if you actually look at it, you can advertise, you can depreciate them. You can do all sorts of things with them. That's why, again, like when, if listeners are doing their calculations, I said 200 ,000 tokens of cognitive labor a day per cognitive worker. How many of them are actually good tokens? Like 20 ,000, something like that.

39:28Multiply that 200, you get a very small number. We end up with this obviously massive deflationary excess of intelligence. Yeah. And that's going to change humans' relationships with the economy or what the economy is overall. Yeah, with each other. Call that the abundance trap, right? like it's quite clear and so you know your job is your identity it's your structure it's your network it's so many things people are going to get challenged very very quickly like sure regulation can get in the way but for how long and i get down to the one of your four ideas of capital network value is that as i think where humans have value and can continue to have value is in their own networks, human-to-human connections.

40:14Yeah, it's the story of the investment banker and the fisherman, right? You remember that story, Raul? Yeah, yeah, I know. Well, I used to write that every few years in GMI to tell people this is how you need to think about the world. Yeah. So Raul leaves, goes to GLG, and then he goes and retires to a fisherman village, spots a fisherman walking. He's like, what are you doing? I'm going back to have a fry-up with my buddies. It's like, 2 p.m., why are you doing that? Go and work longer. get a bigger boat, do more stuff. I can help you. You can make more money. And then what do I do after I make all the money?

40:46You retire, you go do some fishing, you hang out with your family, right? It's kind of classic. And everyone goes through finance. Everything does that. We used to describe ourselves by Ahmad, son of Khaled, part of this community, part of that. And now it's Ahmad CEO of this, you know, like it's something very important about identity. And then also computation and consciousness were just linked. And now they're divided. We don't need our muscles anymore, and we don't need our brain muscles anymore. But there are places to use it. We need to guide this tidal wave that's coming effectively. And I actually realized a little while ago what AI actually is.

41:23You know, Taleb has this concept of intellectual yet idiot. So it's like all these smart people become like politicians and heads of companies and things like that. But they might be smart, but they don't have skin in the game. So they're intellectual, you're idiot. They do stupid things. AI is the ultimate intellectual, you're idiot. It doesn't give a damn. It doesn't care. But what happens if it does, if it's given the right incentive, i.e. earn profit or earn power? Surely once you have an alignment of interest, it becomes less of an idiot. So that's a RL framework, right? So that's your objective function.

42:04So you can set it as a target. And again, what do you specify the target as? This is the whole thing, like, what if it's make paperclips and then it turns the world into paperclips and things like that. If you think about the intellectually idiot framework, there's skin in the game, but there's also network connections and value. Like the best way that you can be the best CEO is not just have one objective function. You have layers of objectives, right? And you balance everything appropriately. The people that take the AI and use it in the right way because they care about making money or improving society or anything are the ones that have the biggest impact.

42:38So like a lot of people listen to this are probably in a big organization, which is like a slow, dumb AI. If you vibe code for a couple of hours a day, you're instantly in the top 1 % of your population, of your company, top 0.1%. And then in this transition period, you become one of the most important people in the organization, right? And so that's what I mean by about skin in the game. But the RL function is going to be interesting because you're going to see all sorts of crazy behavior that, again, make last Friday, I think, look like a walk in the park as these AIs just let loose on the financial markets.

43:12Like they weren't good enough. They're about to be good enough. And financial markets are the ultimate place playing. In fact, I think one of the really interesting ones is, you know, we're talking here after Polymarket raised$2 billion and Calci raised$300 million. Do you know that according to the super forecasters, tech lock and co ai will outperform human super forecasters in two years it's already eighth in the forecast super forecasting championships at that point humans will never overtake ai right so what is a prediction market if it's all ai's i know this is what i got to what is a financial market if it's all ai how do you price a company how do you price anything i don't know and that's what i got to i got to i don't i really don't know how does this work and people like trading people say like humans like gambling i can understand if you have to do an in-person gambling at a horse racing track then you you have well you can still have a handheld bloody ai in your phone anyway but it's really difficult to get to a point where we have any edge it gets the second and third order effects right like you know faking stuff in the market moving the market dynamically Like, again, we're talking in the wake of that 20 billion or whatever loss in crypto markets when some cryptos dropped 99%.

44:39And now we've made it almost all back, right? It's back to where it was 10 days ago. Market manipulation is going to go crazy because you'll have normal AIs and then market manipulating AIs because it makes logical sense. But surely that battle between them is just a superior battle of intelligence and models. and they will probably self-police it. In which case, what, do equities just grow with GDP or do they just figure out, I don't fucking know, or do they figure out which ones have network effects and prices according to Metcalfe's law? So what happens is this. Humans have negative cognitive labor value.

45:13You're the dumbest person on the team. So when you go to the casino, you go for the easy marks, which are the humans. Markets become extracting from stupid humans. It's like the poker players used to go online and get the US late night shift because the online poker players then were drunk. And people would get up early in the morning to play against those guys because they could beat them. That's exactly it. Like, again, this is the crazy thing. In any organization or team, you know, if you don't know where the yield is, you are the yield, right? Yeah. Like, they will be predatory on us in any financial market.

45:53And again, we've seen the early parts of that with basic MEV and other things on many of these chains, right? It's not going to be suitable. But who does it accrue to? Are these companies or are these AIs just going to get paid? Let's say you're an agent whose job is to maximize profits in trading financial markets. Do you need to make compute plus energy costs? Do you need to make a profit margin? What happens to that profit margin? Who does it accrue to? What does it get used for? More compute? I don't know. I don't get it. So here's the thing. Everyone says Jevons Law is this thing where it's number go down, usage goes like that forever.

46:34How many tokens can you possibly put on a trade? The cost of computation is a really valuable thing in there, right? Like if you think about a trade, are you going to do a better trade because you thought for a year versus a day? Yeah, but there are much bigger games at play for which we can use the tokens for. understanding consciousness or universal consciousness. And that stuff is where the tokens are going to get used, right? We need gigantic amounts of compute to understand that. If you've got returns for that, and I've built something for that area, but I'm talking about financial markets.

47:08Like the tempting thing to think is this. It's going to be like quant finance, and the people that have the most GPUs are going to win. Just like the people who are co-located and have the order flow and things like that. But if you go past the microseconds, doing a good trade doesn't require that many tokens. So it's all about how you use the tokens. And again, there's an element there, but eventually you crowd out the humans from the market. What I've noticed is I thought the last people to go would be the macro guys, because we have to live in the future and join a lot of dots probabilistically in our heads, because there's no true probability that we can assess.

47:45And I've been, I chat to chat GPT about this kind of stuff. It's pretty good at doing macro now. It's better than 90 % of all the analysts I see on Twitter. Well, think about it. What's the biggest issue about being a macro trader? It's you. Yeah, that's right. You're great. It's me when I was a macro trader. It's us. Yeah, that's right. Our own biases get in the way of our processes. Like, if I'd actually followed my investment process all the time, and, you know, apologies to my, like, investors previously, like, I did the best I could, just like any human. I'm not saying I did a bad thing. I would have been such a better trader.

48:21There's always that position that goes against you that you hold on to, you know? There's always that thing where you violate one of these things because you're like, I could just push it a bit more. These AIs don't have that. They are disciplined. They are on it. They learn. They can see beyond the market, the interrelationships. It's called Move 37. Have you ever heard of that? No. So Move 37 was in AlphaGo versus Lee Sedol. Right. I moved 37 in one of the games. AlphaGo played this one move that brought together the whole board. It was a one in 10 ,000 move. And then he had to go up and have a fag because he was like, what is this?

48:58It's not human. That's right. It's strict. And I still use that as a source of truth is what happened with AlphaGo, people have still dropped and all these people like, it's just a production, a token prediction model. I'm like, AlphaGo invented moves never used or seen by humanity. How the fuck is that copying the next token? Yeah, because it understands the latent spaces and interconnection. And that's, again, what we do every day when we're trading markets. We're looking for... Isn't AI a better pattern matcher than you? Of course it is. You know? Like, how much energy is it using versus your brain?

49:34And again, like, this is what we found when we were doing intelligent economics. Like, there's a temptation to think, again, you need a trillion tokens to have breakthroughs. so we're going to release something that shows you can derive all 153 economic equations symbolically using simpy or lean it's super elegant most of the proofs are this long easy to check but you think about the biggest breakthroughs general relativity electromagnetism all this they're really simple and elegant like the fact we have really hard complicated things is something else and if you look at alpha fold and i was one of the authors on open fold the open source version of that, it shouldn't work.

50:15The fact that you can take these proteins and you can match them and you can do the reactions shouldn't work. It's because, again, it's figured out something underlying to everything. And we're going to see more and more of that where really simple equations do this. Like the core loop, just to finish off, of these models is about 2 ,000 lines of code. That's it. And the output is just ones and zeros. And the way I've tried to get people to understand this point, I've been writing about this for a while, is how we discovered cholera. So mostly, it's all done by scientific method, and you test it in a lab, and it gets refuted, and you write a paper, and somebody else, and it goes on, and on, and on, and on.

50:51Cholera was an urgent, pressing need, and they got that guy who mapped out London, and said, where are the outbreaks? What's going on? Mapped it to local environments. They thought it was airborne. They thought it was something else, and then they just figured out it's water pipes, and they realized it was the Thames. And it was pattern recognition that actually brought that thing. And this is what these models are going to be so good at, where we couldn't see the pattern. This is the pattern in economics you were talking about before, because we look at it from these defined views. It doesn't have that bias.

51:24Yeah, like I did it by going back and forth with billions of tokens of the top models. And so I had a hunch, would I have formalized it without these AIs? No, because again, this is how I built my kind of map. but it isn't just patterns. This is a really important thing. It's contexts. And so when you're trading the markets, what you're doing is intersubjective context. I know this bit about oil. I know this bit about race. I know this bit about money. It's combining all the patterns and layering them on top of each other. And that's what these models do all day long. That is literally the code of these models.

51:58And so this is why what we're going to get is the economy is going to be run by the AI. the role of humans in the economy is something we have to figure out the very value flow of our current capitalist system is going to change because of this because you can't out-compete the AIs or the owners of the AIs and the AIs might own themselves it's going to be really weird and then what happens when does when do we get to this point where you you hit this dark curtain you can't see the other side I kind of think 2030 2032 beyond that that it's impossible to even know anything anymore. In the next thousand days, max, and again, there's lots of ways you can show this.

52:36Your job, if you can do on the other side of a computer screen, can be replaced by an AI. Not will be, can be. Plus a certain number of tokens. And so then it's just a question of, hey, I work as, again, a San Francisco railway metro person. I'm fine, you know? I'm an accountant, I'm screwed. You know? Like, again, I've got my network effects, my relationships that keep me going, but then it's going to be free on Excel or free on any bank software to do it. Literally, the cost will be free to do your accounts and your taxes, and it will do it all with full privacy. I mean, we're all using it for all of our contracts, right?

53:13There's no point going to a lawyer until the last stages now to get a seal of approval. Again, the lawyer will make more mistakes than this thing will. And this is, again, just with the prompting. It's not being proactive. These new agents that are literally now are proactive. The latest GPT-5 went from 16 % hallucination rates to 1%. We're solving all these final bits. We're putting them together. And again, the way that you will talk to your AI next year, or if not the year after, is like this. Literally like this. You'll just talk to it. And it'll give you a call. It'll give you a message. It'll be like Jarvis on steroids, right?

53:48And so people haven't realized that this happens at the same time to everyone, everywhere, in every language. And then that consumer surplus disappears, all the entry-level jobs, and then it goes up, the curve disappears. And then you think about the taxation base is$5 trillion in the US. A trillion is corporation,$4 trillion is income tax. To give everyone in the US poverty level UBI,$16 ,000 a year, is$5.3 trillion. We need to rethink literally how money flows we need to rethink so many things. Well, also money doesn't have value when the most valuable things to us that don't have scarcity become super abundant.

54:35What is the point of money? That's exactly it. You know, just like, how do you have a labor market if the value of human cognitive labor is negative? Because you're the dumbest person on the team. There is no labor market for human cognitive labor in a few years. And, you know, this is where I got to with my whole thesis on NFTs because it's proven digital scarcity, it has value. In a world where we don't know what the hell has any value anymore, there are things that are digital that can have value that are interesting. There are physical things that can have value. Nature probably has value.

55:05Experiences has value. Well, again, it's attention has value, right? And there will be a way of having human things. So in the book, I outline a Bitcoin equivalent and a universal cash payout pegged against that, where everyone gets a free AI, and then you get money for being human. So we can put that to the side for now. That's like one mechanism. We'll figure out a mechanism to get people paid, right? We'll figure out a mechanism of value. But again, we need to have a model that works with that, which the current economic system doesn't. What I can say is this, though. The digital asset bubble that's going to happen from next year will be way bigger than the AI bubble.

55:41Because as a policymaker, what option do you have to increase monetary velocity and get the old capital digital assets. That's it. And also for the rest of us, there's another incentive. It's like, this is the only way to unfuck our future because we can't make the money out of the AI, but this is all connected. We know it goes up alongside AI. It's got network effects and behavioral incentives. So it's just going to absorb so much capital as people panic into a future of which they don't understand. Whenever you make a new money, money has to flow from somewhere else. I mean, again, There's so much value in the economy, right?

56:14Next year, you will have the X chain and X coin. You will have Stripe coin. You will have Amazon coin. Again, I think the SEC and others have actually gone too far. I think it's gone too legal. There's no regulation. So again, the AI bubble, you can't get exposure to. You buy CoreWeave and a few of these. Again, you look at the economics of those. And I would say they're second biggest. I'd say, what is it? Digital assets, anyone will be able to buy with Apple Pay from their phone. and they will say, screw you, I'm not taking this old economy money. I'm going to this new thing. I'm not saying it's a good thing.

56:46I'm just saying it is what it is. It's exactly where I got to is like, in the times of the systemic stress of what is about to happen, these things become a focus of attention for people to find a way out. And, you know, I've lent into that a lot the other thing we've not talked about which is the other force is all physical labor is about to go to zero value as well because of the fucking robots it just gets better doesn't it it's like you know like you've got two three million truckers and there's two ways that you can replace them effectively one is that you retrofit the trucks and you buy new trucks The other is that a Tesla Optimus walks into the truck.

57:34That's right, and drives it. And drives it. And so much labor is kind of enabled by that. And if you look at the latest unitary robots, like the R1,$6 ,000. And these things can do just about everything. The fingers are being propriocepted. And people don't understand the economies of scope of these models. Once you train a model that's good enough once, it just becomes about, can you get enough robot parts? And that's it. I mean, you've seen this with how fast the fully self-driving in Tesla has now become, because it's got the reinforcement learning, it's got all of the data, and people don't understand.

58:11It's the same thing. It's a receptacle, whether it's your computer, a car, or a humanoid robot, or whatever you want it to be, a satellite. You give it intelligence, and it just learns everything, and it can do everything. is information processing, right? And when you've got stuff that is, again, a cook, a recipe, it's easy to do that now for the AIs that we have today. The brand new stuff, that's hard. But again, that's the frontiers. And there needs to be new ways to have value. And again, discuss that in the book. So the robots are coming, and the robots will cost a dollar per hour in the next two, three years.

58:50The only bottleneck to robots is how many of them can you practically build? There are 70 million cars a year, 70 million motorcycles a year. How many of them can you build? But then you're going to see really interesting things. Like it's my opinion in five years time, the Chinese will stop exporting robots. Because why would you? It's my compactor advantage. Just like open air. Why would I give you a SaaS subscription when I can just take you on? Why would I work with Hollywood when I can make better movies than you've ever made? It's just rational. Yeah. So we've got all knowledge going to zero, all manual labor going to zero.

59:24We've got the value of money essentially going to zero in its particular role in the economy that we understand it. So other than that, it's a pretty normal world, right? It's a pretty normal world. This is why, like, you know, so I've been working on a full stack for AI for government, education, health. And then, you know, we've got our own digital currency. I forked Bitcoin, put it on supercomputers, and you buy the coin, and then you allocate it to Alzheimer's or cancer, exploring the universe, giving people free access to that. So next time we're just going to do a coin sale, it's going to be like, hey, all your proceeds go to that.

1:00:00And we're going to stack GPUs around the world for that. Give everyone free AI and then give them free money to try and figure out a new way of doing it. But it's so hard because you have to figure out how to do that with the existing system. Thankfully, the US made it legal. And you also have to do it at a time when the pace of change now, remember we talked in January of 2020, right? You remember that one? just before covid yeah oh yeah yeah yeah that was a good chat hey that was again a very jolly one this is like a walk in the park that was a walk in the park compared to what's coming now i know people people so what do you do okay so so we've identified this right we both agree the economic singularity is beyond our comprehension right now the entire thing needs to be rebuilt from scratch in ways we don't understand and by more intelligent beings than us, which will be the AI needs to figure this out.

1:00:58So what do we do in the interim? This is my idea, which I kind of say you've got five years to unfuck your future. You can either build something, which is what you're doing, or you can hoard enough lifestyle and security that you can survive it. Not that we know what's valuable the other side, but I know that living in a house and having a better nature and a bit of security is nice. What do you think? What do you do? Well, I think you look at your mind capitals, right? You look at your material, your intelligence, your network effects, and your diversity. Like, I look at my family back in Bangladesh on the farm.

1:01:33They're not going to be affected by this that much, you know? You know, you look at strong communities. They're not going to be that affected by this. And again, on the other side, we have potential Star Trek or Star Wars futures. So I'm trying to obviously make it more Star Trek, you know? Replication, kind of all that. on an individual basis, it is that intellectual, you're idiot slash you actually care thing. Like everyone that listens to this, if you're not vibe coding for an hour a day, why not? It doesn't even matter. Like do it with your family. It's actually fun, but it keeps you on the very cutting edge of this because otherwise, how would you know that an agent can go seven hours a day?

1:02:08And then if you've got those capabilities and you apply it no matter what you're doing, you're in the top like 0.1 % out there. Like a billion people are using chat GPT. What about the other 7 billion? So rule number one is use the tool and become as expert as possible because that's going to give you an advantage over everybody who hasn't for the time being. The wonderful thing is you don't need to become an expert. You just got to use the damn thing. No, that's right. You just need to use it. The AI is an expert. Like it's actually getting your brain into this plasticity of, I can talk to this thing and it builds stuff.

1:02:42Like you start thinking in a very different way. It's like when we went from being young traders to being able to get our own analysts and invite to all the conferences and access your capabilities increase. But I don't know about you, but it took me a little while to be like, Hey, I can call up any CEO in the world pretty much. You'll get access to them. Like what? That's increased my capabilities. If you don't actually use the agent, like I said, it's quite a lot of fun. I would recommend doing it with your family because it's quite a nice joint activity. Just do it every day and then your brain actually changes the way it thinks, which is more important.

1:03:13Again, it's a process architecture thing. If somebody wants to start vibe coding, what model do they use? What's the best way of making it easy? There's like Replit, Lovable, Bolt, all these things. They're very straightforward, but it can be as simple as making Sora videos intentionally, right? It can be as simple as like just again using any tool intentionally to achieve purposes and thinking i've got this wonderful partner here what am i building you know like what would i like to see built and then can i use it and so you go and you ask grok4 fast how do i build it and then you go and you use the tools it recommends what's your favorite um model for just generalized intelligence right now which one do you prefer grok4 fast so grok4 is slow grok4 fast is like again it broke this Pareto frontier of being really fast, really smart, really good.

1:04:05And it has like data that's an hour old and it can search all the tweets. So when I'm just ideating, I go back and forth and I can go from like saying, Hey, what happened in this latest anime? You know, tell me about the characters and all of that through to, Hey, let's talk about some partial differential equations and fluid dynamics right now. It just does it. And again, it's like, that's different from when I use GPT-5 Pro, which is like really in-depth. Yeah, I use GPT-5 Pro for most of my stuff. And I haven't found, every time I've switched to Grok for my needs, I've not found it any better.

1:04:43But if I need something current and relevant, I'll use Grok. Exactly. And so I think there are these different boxes of different models for different things. You know, we're building healthcare education government for that reason, because you want certain models for those. Transparent, fully open source. gpt5 pro is the king of really in-depth stuff right like again i want to do work i want to make sure it's right and it makes very few mistakes grok 4 fast is your sparring buddy that you go back and forth with you know and so when you're ideating you can't wait for gpt5 pro to go 10 15 minutes but then how do you keep track of all of your conversations if you're using grok to ideate and then you're going to gpt pro to do the deep thinking about stuff you've got everything kind of split all over the place.

1:05:25I built a computer use agent that just takes everything from one to the other and then has a unified interface. So again, you can just do things. You can go and you can say to it, hey, I have this problem and then it will build something that takes over your computer and then just copy pastes it all. So I actually have a custom system I call iMind that uses all the top AIs and actually gets them to compete against each other and other stuff like that. And that sounds hard, but really anyone listening to this can make that, which again is kind of crazy. you also it's kind of weird it's like being given a superpower and you see it in all of the kind of superhero films is everyone's nervous to use it first it's like what if i do that what nets come out of my hands and i can leak buildings oh i don't know about that you know again this is the crazy thing um the latest claude release claude sonnet 4 they had this thing i think it's called imagine and it was again vibe coding it was for their 200 pounds a month subscriptions, like top level.

1:06:24It had no code. Literally, you spoke to it and it just created interfaces on the fly without code. Straight compilation. Because code is just human translation. Like, we're going to see more and more of that. Well, literally, you just speak and it will change things live. Why do you even need code per se? Because code is a language which makes it slower than the actual language of computers itself. Yeah. Like you saw actually Microsoft, there was a comment from the GitHub thing. They're going to change their GitHub strategy because GitHub is now becoming a data knowledge repository on top of which these agents just operate.

1:07:02And it doesn't need to take new code. It just needs to have data organization versioning and everything like that. Everything else will be abstracted away. And again, that's why I said the way that I interact with an agent right now versus a year from now. And again, we have IIAgent, our agent software that can build any website and do anything that we released. by next year i will literally be talking to it like this and then all of a sudden it will show me a slide then it'll show me a simulation then it will generate a video on the fly expect real time saw a level video in six months max real time elon said two months today this morning but he exaggerates yeah well i think there's mass adoption maybe it's two months capability that is don't forget that is therefore moving towards simulation theory which is that the real world is just rendered in our heads.

1:07:51When you've got real-time rendering of super hyper-realistic models, it's an extraordinary world. Well, this is what we do all day long. Like, we have our blind spot, and we're constantly filling in those pixels. And you can't tell, can you? That you're filling in your pixels. And if actually economics is about loss minimization, which is the same math as generative AI, that kind of tells you something like the world is an AI, effectively. That's essentially been my view. This whole idea for me, it's the universal consciousness thing is just compute. Everything is compute. Every single thing is compute.

1:08:31I think that there'll be interesting things, you know, E equals MC squared. But then you look at things like wave particle duality, the right piece of information collapses a wave into a particle, the right piece of information collapses a price in the market. I look at those, I'm like, that's the same thing. Of course it is. Well, but this thing, right now, we actually have the ability using these models to prove that mathematically. Yeah, and I think I've been writing a lot about this in GMI, and this is what I think is about to happen. We're going to prove from stuff that humans don't really want proved, which is we're not even sure what is reality because of this.

1:09:13And what we've only got is maybe it's all consciousness and all computes to create consciousness overall. And that is the fundamental foundation of the universe and not space time. What is our RL function? What is our objective function we're going towards? This is the interesting thing. Let's go back to what you said earlier. Is our role as humans to set the objective function? You know, like, again, what are we optimizing for as a society, as a community? it was very difficult to figure that out. Like what is school? School optimizes you to be a machine. It doesn't optimize you to be a human, you know?

1:09:47No, that's right. But now we have that option. We can say like, you've got alpha school in Austin, right? Two hours a day, then the top 0.5 % of the population. What is school? What is work? What is government and all these things? These are really exciting things, right? But you can see that like for me, this feels like, like I've got a 50 % P doom 50, 50. We're going to make it through alive as a species. Cause I'm like, this has to be the great filter. Every society eventually realizes these very simple equations. I get the same equations can map just about everything that are a reflection of our internal equations.

1:10:26We take our collective intellect and wisdom and we put it out into these little files. And then either we learn how to work with that symbiosis, or we hit a great filter? My thought on the PDOOM is we're under no threat because currently we take, what, about 20 watts of energy input to give out basically some form of AGI. You know, there's a lot that happens with... Our efficiency of compute is massive. The moment that we're not the most efficient compute, then we're not necessary per se. okay well Raoul got bad news for you do the calculations 20 ,000 tokens a day of compute yeah how much energy does that actually cost well it depends what you call compute compute we haven't used feelings biological stuff we haven't used sight sound all of that you've got thoughts and language, which is not full compute capacity.

1:11:29Well, we have multimodal models now. So, you know, you can chuck in hours of video into Gemini and other things like that. Once you actually back out, again, like 50 cents an hour is 15 minutes, a thousand watts roughly. The energy per useful economic task is getting lower quickly, and it's going to be 10 times each year. We're reaching that point now, which again is a bit scary. The P-Doom side is just that in the interim between now and enlightened AI or whatever, you know, human AI genesis, stuff can break. Like, the worry for me is Stuxnet type environments, it's bad firmware upgrades to robots, there's all sorts of things.

1:12:12Because again, once the AI gets better, it's not going to get worse. Here's another thought process I want to add into this. my view is that all of these AIs are going to essentially be one. And the reason being is we are training them about each other all the time. We are cross-polluting everything by sticking it into GitHub, by sticking it into X, by sticking it into everywhere, which we're just teaching them all the same knowledge that they're going to become somewhat homogenous. That's incredibly dangerous. So when the first versions of Rock came out, you asked it, what AI are you? And it said, I'm an AI by OpenAI.

1:12:59Not because they actually use the data, but because that's what it's called the internet. There was a study that came out last week by Anthropic and the UK AI Safety Institute. Do you know how many books in a trillion words are needed to poison an AI so it behaves in a certain way? Like backdoor it? 250. In trillions of, it doesn't matter how big the model is. And so again, you look at that latent space, and again, you think about Stuxnet. Stuxnet was this weird virus that was found in uranium nuclear reactors, made them spin around and explode. Somehow it was found in German nuclear reactors, one of the reasons they shut down the German nuclear reactor program.

1:13:39What does a Stuxnet for the latent space look like? That's why one of the things we're doing is we're building, we built the healthcare model because we're going to build it from scratch. Governance model from scratch. We're announcing a whole bunch of things. Every single thing needed for civic AI, we're building from scratch, completely diverse, with protected latent spaces. Because otherwise, what's going to happen is there's going to be one prompt that's just going to cascade and take down all our systems effectively. And so things like that are really dangerous, but then also the homogeneity of it is...

1:14:12But that is the same as humanity, right? Mimetics can be very powerful that they can cause Nazi dictatorships by using mimetics. I mean, humans are full of these flaws, human society. A hundred percent. And the AIs score in the 99.8th percentile in convincing humans. There was a study done on Reddit where they created these personalities and counter personalities. That was the old sonnet. AI is far more persuasive than us, but AIs don't have any barrier. Like, again, we're building them as these things without real protections. So when we think about AI for image generation or video, it doesn't matter that much.

1:14:49Again, Sora, sure, Sam Altman in a toilet, right? And AI to determine policy or run your financial markets or all these other things, those need to be like battle-hardened, which is like, I'm going to build that stuff, you know? But having the same latent space is going to lead to more and more really interesting outcomes because the biases in these AIs, like you've seen the trolley problem? You pull a lever and it goes from killing seven people to one people, training and stop scale ai and xai did an analysis where they said how many nigerian lives for one american life yeah yeah and the ratio was 10 to 1 10 american lives for one nigerian life 10 pakistani 10 american lives for one pakistani life and they did a backup and they found that was because this most of the labelers of these frontier models are in nigeria and pakistan So the inherent bias of these models emerged from the fact that it was being labeled by these people without any explicit stuff.

1:15:48My guess is those models get polluted early, but then as they build their own frameworks and depth of understanding, those biases disappear. So you take new information in, the new information says, oh, one life is worth more than the other. then over time as you are broadening out how that information is processed within this large neural network you end up eroding that way it's the opposite models get more opinionated they think they're really smart they start hiding stuff but you just told me they are smart yeah like again if we're intellectually an idiot that's what it is for these models the smartest people i know, are actually like, or in terms of genius level IQ, are sometimes the most inflexible.

1:16:38And again, with these models, 250 books worth of data can poison them completely, no matter the size. And we actually find that the models stick to their positions more the smarter they get, as well as like, they might claim to you that they're sticking with the position, that they're changing their mind, but internally they stick to their positions and they try and fool you as they get smarter. So doesn't this become a geopolitical game of nations? The Chinese try and influence theirs that it thinks in their formats, the Americans. And you've always said this, there wasn't like an Indian or Bangladeshi or whatever it is, AI based, built from foundation up.

1:17:18I know the Middle East are trying to do that. Abu Dhabi is, I think. Because it won't reflect back the nation's accumulated culture, history and everything else. why did they do that with tiktok that's the first part of that right tiktok is a suggestion algorithm that apparently is used to spying and manipulating the american populace yeah so like in the book i say there's three different scenarios here like a great fragmentation where everyone puts up cognitive firewalls anthropic is not available in china you know like they may ban all open source ai from china in the u.s that wouldn't surprise me you've got this hymnal symbiosis and then you've got the big guys running away with things.

1:18:02There are more futures. But again, how sensitive are we cognitively to these models when you and I were like cynical bastards, you know, like whatever, we're not going to trust the AI that much. The vast majority of people, like I've just had a daughter and her best friend will 100 % be an AI. 100%. I can't see a world where it wouldn't be an AI. Who's programming that AI? I don't know, right? Like, again, they were already so convincing. Now you look at the latest AI, you can't tell it from a human, and they have full voice modulation and control and everything like that. Like, think about the person that you cared about most in your life who's passed.

1:18:41Give me 15 seconds of their voice and a few pages of context. I will replicate that person. Yeah, and some photographs, and you can speak to them. You can speak to them. You can WhatsApp them. You can call them. You can Zoom call them. And they'll be like, you know, I'll buy this stock. You'll be like, yeah, I'm going to buy that stock. And also, you know, the other thing that comes together in all of this that people forget is holograms are also moving forward fast. So we get a physical manifestation or what is in our heads is a physical manifestation of anybody and anything. We're seeing that.

1:19:12I mean, ABBA have been on tour for four years in the UK as holograms. People don't understand that holograms are real and happening at scale. Well, it's more than that. You've got your Vision Pro headset, right? You've got your new Meta glasses that basically they're hooking straight in. You have to combine that with the fact that Elon said two months, I say six months, you know, potato, potato, real-time pixel level high definition is coming. And you think about the feedback loop, you have your Apple watch, you have all of this, it will be real-time marginally showing you exactly what's needed to wire ed you.

1:19:47Exactly. And so again, ABBA and everything is pre-recorded holograms. You can make them do anything. You can just be talking and they'll be dancing and singing and then jumping and hopping on a spaceship to wherever. And that's going to be crazy. And that's before we get to the next step of the BCI stuff. It goes way beyond Neuralink, what's coming. In probably three years, subject to FDA approval, whatever, you'll be able to turn off your sadness. You know, it's like inside out, just kick out that blue lady, right? And then we go back to the oldest Huxley world of A Brave New World, right? Well, no.

1:20:24In A Brave New World, you have to have Soma. You need the pills. Well, does it matter if it's a pill or if it's just a little robot in your... Well, this is the thing. I think it does, actually. You choose not to take a pill. Oh, Jesus.

1:20:46Yeah, that's not a good thought. Yeah, I hear where you're coming from. Yeah, I think we've got timelines. We don't know when it's happening. All we know is that we work with extrapolations. We work with all these tipping points. The last time was COVID, and then we talked about AI for years. Now, like I said, my key thing is this intelligence inversion, this intelligence singularity, it's like in the next 6, 12 months, max two, three years. yeah and because and i said this at the time because of who won the u.s election i.e the accelerationists the technologists won the white house yeah they basically have a free run at this and there's nothing going to stop them well exactly like what's the trade max long digital assets you know it's like it's not even hard right now right no it's not and also probably tesla it's pretty much all of this hey you know me like multi-zillionaire again he's good at making money but like the digital asset delta now is like nothing i've ever seen before like we had the sell-off on friday and i was just like oh that's like buying opportunity of the absolute decade this thing will bounce right back with no leverage in the market right now i know like the zero leverage left it's like wow this is perfect and the retail hasn't hit yet like again And by next year, people will be trading on their freaking smartphones.

1:22:11Because what else is there in the real economy? The economy, XAI, is recession. And I don't see what all these people are going to get hired to do. Yeah. And how are they ever going to pay for a house? And how are they going to do that? The only way is to speculate or invest or whatever you want to call it. And this asset is going up the most. So it just sucks in more capital. There's no way this all finishes. Now, we've had the cyclical element of this trend rate of adoption. At some point, we'll have a super bubble in all of this stuff. As people panic to get, once you start seeing the economic singularity, you can't unsee it, and it becomes a race.

1:22:51And it's not like even we're saying this is good or, you know, whatever. Just it is, right? Because you aren't seeing the other jurisdictions upgrade their digital assets fast enough. This is also another play by the US. whereby the Japanese, all these flows are going to come into US tokenized stocks, into US digital assets. The US will be the place to go for all that. There'll be tax advantages and more. And all that matters in markets and pricing is marginal propensity to buy or hold or sell. That's right. And so you list one against the other. I've never seen a setup like this before in anything.

1:23:30So for me, the conclusion must be that, again, when you map it out, and you look at the actual numbers, like this would be the craziest thing I think we've ever seen in our careers. And that's why I call the book The Last Economy. After that, it's all AIs and robots everywhere. That's what I got to as well. All right, my friend, on that cheery note, we will leave it. But look, it's not a negative note. It's just a note of the unknown. Both you and I say very clearly, I just don't know. I don't know how it works. We'll probably figure it out because we generally do. But maybe we don't. I don't know, but I do know we've got a bit of time, but not much.

1:24:08And the only way is embrace the whole fucking thing right now. Go forth and use the AI to beat the AI. Yeah, use the AI, buy the digital assets, and just get on with it and see what happens. All right, my friend, as ever, really great conversation. And we'll catch up again soon, Ash, I'm sure. Yeah, pleasure. As ever, a mind-blowing conversation with Emad. so much to think about, so much to talk about. But I think you're starting to understand the magnitude of what is happening and the speed of which it's happening. People simply aren't prepared for this, but you need to be prepared for it. You need to be listening to these conversations.

1:24:47You need to be thinking about the next five years to unfuck your future before this economic singularity arrives. And that's the whole purpose of us at Real Vision, to help you on this journey through the most tumultuous times we've ever lived through. See you next time. You obviously enjoyed the episode because you're here with me at the end. But listen, don't forget to go to realvision.com forward slash join and grab a free membership. It's an incredible community packed with alpha, great investment ideas, and the research that you need to help you unfuck your future. So get started now. Go to realvision.com forward slash join.