From the Moon to AI: What Tech Advancements Mean for Your Portfolio
I was watching a movie the other day that took place in a small town. In one scene I noticed that the town still had a phone booth, yes an actual phone booth. Like the one that Superman would change from mild mannered Clark Kent into the Man of Steel. The movie didn’t actually use the phone booth, it was just in the backdrop. Something like that makes you think about all the changes that we’ve had just in a lifetime.
In 1969, the United States NASA was the first to put a man on the moon. Many of our clients likely remember watching that when it first happened. The computer that was used at that time was the Apollo Guidance Computer (AGC). The AGC was the premier computer of its day with a whopping 32 KB of Ram and it weighed 70 pounds. Today, an iPhone has more than a million times the computing power of the AGC and luckily doesn’t weigh anywhere near 70 pounds. Could you imagine trying to carry around a 70 pound phone?
Computers are certainly the driving force behind technology today. While we may not have flying cars as predicted in Back to the Future: Part 2, we are starting to see self-driving cars. (I’m also quite disappointed they haven’t developed the Hoverboard yet.) And of course, the new kid on block is Artificial Intelligence (AI). Car manufacturers are using AI to facilitate those self-driving cars. The vehicle’s cameras and sensors feed into the computer and the AI uses that information to drive the vehicle. It’s not perfect yet. The video is typically shared with the engineers that continue to teach the AI when it gets something wrong.
We can’t predict what technology will look like in 30-40 years. If you were to ask someone from 1990 what technology would be like in 2024, they wouldn’t be able to give an accurate answer. What we can predict is that technology and humanity itself will continue to advance. Human beings will continue to advance and develop new technologies.
How does any of this apply to your investments? Well, people think of investing in “stocks” in different ways. Some people see it as gambling (it can be if you are trying to time the market or putting all your money in a single stock). Others think of it just in terms of capitalism. I like to think of it as investing in humanity. When we build well-diversified portfolios, we are invested in the whole world economy. We are investing in the advancement of humanity. My long-term outlook for stocks will always be positive, because my long-term outlook for humanity is positive.
P.S. This article was not written with the help of AI. However, I did use ChatGPT to come up with the title. If you haven’t already, you should check out ChatGPT (or similar chatbot). It can be quite interesting.
Jeff Karst, CFP®
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