I. Is AI Ready for Primetime?
The Roaring 2020s started in the stock market on November 30, 2022. That’s when OpenAI launched ChatGPT. I signed up for the $20 per month version of this program that is driven by artificial intelligence (AI). It can write reports and carry on a conversation. I gave it a whirl to see if it might write our Morning Briefings or our shorter QuickTakes.
My disappointment was immediate. It was clear that we would have to spend more time fact-checking and correcting the many mistakes in the program’s output than it takes us to write our research. In other words, there’s plenty of room for improvement in this new technology. So there’s no immediate prospect of spending the rest of our lives carefree and drinking piña coladas on the beach.
AI is artificial but hardly intelligent. It is basically a statistical probability model that can digest huge amounts of information from the Internet but lacks the ability to recognize and correct its own mistakes, which is a key attribute of intelligence.
The simplest versions of AI have been around for a while. Microsoft Word has long had an autofill feature. When you turn it on, it anticipates your next words and suggests words or phrases as you type. When you are using it, you must check to make sure that it is correctly predicting what you intend to spell or the next couple of words you intend to write. If it makes the wrong prediction, you immediately recognize its mistake and just keep typing, ignoring autofill’s suggestions.
Google describes its Autocomplete as “a feature within Google Search that makes it faster to complete searches that you start to type. Our automated systems generate predictions that help people save time by allowing them to quickly complete the search they already intended to do. … In addition to full search predictions, Autocomplete may also predict individual words and phrases that are based on both real searches as well as word patterns found across the web.”
Other examples of AI that have been around for a while are Apple’s Siri and Amazon’s Alexa. They can accurately answer lots of questions. They can play music, videos, and audio books. They can wake you up in the morning and tell you the weather. But they can’t converse with you. They are one-trick ponies as personal assistants. In my opinion, AI will be ready for primetime once Siri and Alexa can function as multitasking personal assistants.
Billions of dollars are now being spent on AI technologies. The result should be more intelligent AI that will boost productivity as widely expected.
II. Meet Professor Gary Smith.
Gary N. Smith is the Fletcher Jones Professor of Economics at Pomona College. His research on financial markets, statistical reasoning, and artificial intelligence has been cited often. He has focused on stock market anomalies, statistical fallacies, and the misuse of data. He is the author of dozens of research articles and 16 books.
Gary was an assistant professor and one of my teachers in Yale University’s PhD program in economics. He has recently influenced my thinking about AI. See for example his January 15, 2024 article titled “Internet Pollution—If You Tell A Lie Long Enough…”
He argues that:
