Mind Matters Natural and Artificial Intelligence News and Analysis

TagGary Smith

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Warning: Unicorn Stocks May Be Nearing Bankruptcy, Fire Sales

Uber, Airbnb, and DoorDash seem so lifestyle-friendly … they even became part of our vocabulary

In an article today, Jeffrey Funk and Gary Smith puzzle over the way investors have “rained cash” on unprofitable companies like Uber, Airbnb, DoorDash, etc. Yes, they are icons of popular culture. No, unlike Apple and Google, they do not make money: Here are their stats from the table the authors offer: Company Founded Funds Raised Cumulative LossesUber Technologies 2009 $25.2 billion $31.7 billionAirbnb 2008 $6.0 billion $6.0 billionDoor Dash 2013 $2.5 billion $4.6 billion Only one of the 15 companies they list — including some other culture icons — has ever had a profitable quarter: Any hopeful arguments that profitability is just around the corner ring hollow when every company is at least nine years old and two are…

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Turns Out, Computers Are Not Vacuuming Up All Our Jobs

Far from it, we can hardly find all the people we need to manage the computers

Let’s start with radiologists: In 2016 Turing Award Winner Geoffrey Hinton advised that “We should stop training radiologists now. It’s just completely obvious that within five years, deep learning is going to do better than radiologists.” Six years later, the number of radiologists has gone up, not down. Researchers have spent billions of dollars working on thousands of radiology image-recognition algorithms that are not as good as human radiologists. Jeffrey Funk and Gary Smith, “The right and wrong way to use artificial intelligence” at New York Daily News (August 6, 2022) Technology researcher Jeffrey Funk and business prof Gary Smith could — and probably will — fill a book with examples, some of which they list and link to at…

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Not All False Prophets Are Promoting Religions…

False finance prophets’ credentials or charisma are much more impressive than their track records — but we need a way to tell

Recently, our authors Jeffrey Lee Funk and Gary Smith alerted MarketWatch readers to the problem of “false prophets” in the investment world: We could write a long book about false prophets on Wall Street. What is interesting is how easily people are enchanted by charismatic personalities — some who peddle advice, some who run companies. A decade ago, for example, Yahoo tried to save itself by paying almost $1 billion to five charismatic CEOs (Terry Semel, Jerry Yang, Carol Bartz, Scott Thompson, and Marissa Mayer), four of them outsiders, who were hired over a five-year period and arguably did more harm than good. Jeffrey Lee Funk and Gary N. Smith, “Sensible stock investors put their money on a company’s real…


Would AI Still Win at Go If the Board Shrunk: 19 to 17 Spaces?

No, say Jeffrey Funk and Gary Smith — and would-be investors need to grasp AI’s weaknesses as well as strengths, for success

Statistician Jeffrey Lee Funk and business prof Gary N. Smith offer a warning for investors: Some AI stocks have been good investments but most high tech unicorns never pay off. It’s a not surprising, they say, when we consider that AI is powerful but brittle. An example they offer: AI easily beats humans at the game of go which features a 19 × 19-square board. If the game switched to a 17 × 17-square board, humans would quickly adjust but AI would flounder. They offer examples of how this sort of limitation plays out in the real world, including the true tale of a hapless AI-driven insurance company: An insurance company with the quirky name Lemonade was founded in 2015…

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At Salon, Funk and Smith Take On “Stealth AI Research”

All we know for sure about the claims about Google AI’s LaMDA showing human-like understanding is that, since 2020, three researchers who expressed doubt/concerns were fired

Yesterday at Salon, Jeffrey Funk and Gary N. Smith took a critical look at “stealth research” in artificial intelligence. Stealth research? They explain, A lot of stealth research today involves artificial intelligence (AI), which Sundar Pichai, Alphabet’s CEO, has compared to mankind’s harnessing of fire and electricity — a comparison that itself attests to overhyped atmosphere that surrounds AI research. For many companies, press releases are more important than peer review. Blaise Agüera y Arcas, the head of Google’s AI group in Seattle, recently reported that LaMDA, Google’s state-of-the-art large language model (LLM), generated this text, which is remarkably similar to human conversation: Blaise: How do you know if a thing loves you back? LaMDA: There isn’t an easy answer…

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Studies Based On Data Mining Can Turn Out To Be Nonsense

As business prof Gary Smith explains at Bloomberg, we can find a great deal of nonsense if all we rely on is a search engine

Many of the studies represented to us in media are not nearly as reliable as we would like to believe, as Gary Smith explains at Bloomberg. He starts with statistician John Ioannidis pointing out that of 34 “highly respected” medical studies and found that only 20 were confirmed by the Reproducibility Project.: I wrote a satirical paper that was intended to demonstrate the folly of data mining. I looked at Donald Trump’s voluminous tweets and found statistically significant correlations between: Trump tweeting the word “president” and the S&P 500 index two days later; Trump tweeting the word “ever” and the temperature in Moscow four days later; Trump tweeting the word “more” and the price of tea in China four days…

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Luck Matters More Than Skill When You’re at the Top

What? Shouldn’t it be the other way around? No, because… Prof. Gary Smith explains

With basketball fever at a high pitch… when LA Times sportswriter Jim Alexander talked to Pomona College business prof Gary Smith about what it takes to win, he got a different answer than some might have expected. If you are really good, it takes luck to win, Smith explained. What? Shouldn’t it be the other way around? No, because… “You can take the four best golfers in the world – any sport, but let’s do golf because it’s head-to-head,” Smith said in a phone conversation this week. “And they play a round of golf and see who gets the lowest score, and it’s pretty much random. Nobody’s going to win every single time. One guy might win more than 25…

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Computer Prof: We Can’t Give Machines Understanding of the World

Not now, anyway. Melanie Mitchell of the Santa Fe Institute finds that ever larger computers are learning to sound more sophisticated but have no intrinsic knowledge

Last December, computer science prof Melanie Mitchell, author of Artificial Intelligence: A Guide for Thinking Humans (2019), let us in on a little-publicized fact: Despite the greatly increased capacity of the vast new neural networks. they are not closer to actually understanding what they read: The crux of the problem, in my view, is that understanding language requires understanding the world, and a machine exposed only to language cannot gain such an understanding. Consider what it means to understand “The sports car passed the mail truck because it was going slower.” You need to know what sports cars and mail trucks are, that cars can “pass” one another, and, at an even more basic level, that vehicles are objects that…

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When Silicon Valley Turns From Hype Over Vaporware to Fraud…

Jeffrey Funk and Gary Smith discuss the famous Theranos case, which resulted huge losses and in convictions for fraud

In a column published today at MarketWatch, Jeffrey Funk and Gary Smith talk about that unpleasant subject, the shady side of Silicon Valley. They’re not looking at the unicorns naively chasing rainbows but rather the cases of apparently deliberate deception. One of them is vaporware— announcing a product that won’t really exist any time soon (perhaps in the hope of dissuading potential buyers from investing in a competitor’s product). Another is “fake it until you make it,” the topic of today’s column. Investors sign on by throwing money at the company, which the company then spends trying to develop what it said it already has. Either way, the company keeps lying as long as necessary, or until its cover is…

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Detecting BS Research: If It Seems Too Good to be True…

A recent Wall Street Journal article shows a near-perfect link between inflation and money. But a link that near-perfect raises suspicions

Two Johns Hopkins economists recently wrote a Wall Street Journal opinion piece titled, “Jerome Powell Is Wrong. Printing Money Causes Inflation.” Their argument is that Federal Reserve chair Powell is mistaken in his assertions that there is not a close relationship between money and inflation. As evidence, they offer the chart below, showing that the rate of inflation can be predicted almost perfectly from the rate of increase of M2, a broad measure of money. The authors explain: The theory rests on a simple identity, the equation of exchange, which demonstrates the link between the money supply and inflation: MV=Py, where M is the money supply, V is the velocity of money (the speed at which it circulates relative to total spending), P…

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Does Creativity Just Mean Bigger Data? Or Something Else?

Michael Egnor and Robert J. Marks look at claims that artificial intelligence can somehow be taught to be creative

In Define information before you talk about it, neurosurgeon Michael Egnor interviewed engineering prof Robert J. Marks on the way information, not matter, shapes our world (October 28, 2021). In the first portion, Egnor and Marks discussed questions like: Why do two identical snowflakes seem more meaningful than one snowflake? Now they turn to the relationship between information and creativity. Is creativity a function of more information? Or is there more to it? This portion begins at 10:46 min. A partial transcript and notes, Show Notes, and Additional Resources follow. Michael Egnor: How does biological information differ from information in nonliving things? Robert J. Marks: I don’t know if it does… I do believe after recent study that the mind…

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Robots Will NOT Steal Our Jobs, Business Analysts Show

Doomsayers typically do not factor in all components of the job that a robot would have to replace or all of the true costs of trying, they say

At Fast Company, data analyst Jeffrey Funk and business prof Gary N. Smith dispute the claim that robots are coming for all our jobs. They point to a history of overblown claims: In 1965, Herbert Simon, who would later be awarded the Nobel Prize in Economics and the Turing Award (the “Nobel Prize of computing”), predicted that “machines will be capable, within 20 years, of doing any work a man can do.” In 1970, Marvin Minsky, who also received the Turing Award, predicted that, “in from three to eight years we will have a machine with the general intelligence of an average human being.” The implications for jobs were ominous, but robotic-takeover predictions have been in the air for a…

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The Unicorn Might Be Very Profitable — If It Existed

The statistical reality is that most new businesses flop

Jeffrey Funk and Gary Smith, well known to many of our readers, have just published an article at MarketWatch, warning against heedless optimism about “unicorn” stocks. As they put it, “The stock market unleashes its ‘animal spirits’ on an animal that doesn’t exist.” They begin by pointing out that most new businesses flop. The president of one venture capital company estimated the chance of success at one in 1,000. An SEC study of 500 randomly selected new issues found that 43% were confirmed bankrupt, 25% were losing money but still afloat, and 12% had disappeared without a trace. Of the remaining 20%, just 12 companies seemed solid successes — a scant 2% of the companies surveyed. Jeffrey Funk and Gary…

Cold fresh lemonade with slices of ripe lemons.

Insurance Company Gives Sour AI Promises

Data collection and discriminatory algorithms are turning Lemonade sour

An insurance company with the quirky name Lemonade was founded in 2015 and went public in 2020. In addition to raising hundreds of millions of dollars from eager investors, Lemonade quickly attracted more than a million customers with the premise that artificial intelligence (AI) algorithms can estimate risks accurately and that buying insurance and filing claims can be fun: Lemonade is built on a digital substrata — we use bots and machine learning to make insurance instant, seamless, and delightful. Adding to the delight are the friendly names of their bots, like AI Maya, AI Jim, and AI Cooper. The company doesn’t explain how its AI works, but there is this head-scratching boast: A typical homeowners policy form has 20-40…

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Nobel Prize Economist Tells The Guardian, AI Will Win

But when we hear why he thinks so, don’t be too sure

Nobel Prize-winning economist (2002) Daniel Kahneman, 87 (pictured), gave an interview this month to The Guardian in which he observed that belief in science is not much different from belief in religion with respect to the risks of unproductive noise clouding our judgment. He’s been in the news lately as one of the authors of a new book, Noise: A Flaw in Human Judgment, which applies his ideas about human error and bias to organizations. He told The Guardian that he places faith “if there is any faith to be placed,” in organizations rather than individuals, for example. Curiously, he doesn’t seem to privilege science organizations: I was struck watching the American elections by just how often politicians of both…

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Failed Prophecies of the Big “AI Takeover” Come at a Cost

Like IBM Watson in medicine, they don’t just fail; they take time, money, and energy from more promising digital innovations

Surveying the time line of prophecies that AI will take over “soon” is entertaining. At Slate, business studies profs Jeffrey Funk and Gary Smith offer a whirlwind tour starting in the 1950s, with stops along the way at 1970 (“In from three to eight years we will have a machine with the general intelligence of an average human being”) and at 2014: In 2014, Ray Kurzweil predicted that by 2029, computers will have human-level intelligence and will have all of the intellectual and emotional capabilities of humans, including “the ability to tell a joke, to be funny, to be romantic, to be loving, to be sexy.” As we move closer to 2029, Kurzweil talks more about 2045. Jeffrey Funk and…

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#8 in our AI Hype Countdown: AI Is Better Than Doctors!

Sick of paying for health care insurance? Guess what? AI is better ! Or maybe, wait…

Merry Christmas! Our Walter Bradley Center director Robert J. Marks has been interviewing fellow computer nerds (our Brain Trust) Jonathan Bartlett and Eric Holloway about 12 overhyped AI concepts of the year. From AI Dirty Dozen 2020 Part II. Now here’s #8. Sick of paying for health care insurance? Guess what? AI is better! Or maybe, wait… “Is AI really better than physicians at diagnosis?” starts at 01:25 Here’s a partial transcript. Show Notes and Additional Resources follow, along with a link to the complete transcript. Robert J. Marks: We’re told AI is going to replace lawyers and doctors and accountants and all sorts of people. So, let’s look at a case of the physicians. This was a piece on…

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Smith and Cordes’ Phantom Pattern Problem A Top 2020 Book

Published by Oxford in 2020, it deals with the “patterns” Big Data throws up that aren’t really there

David Auerbach has picked The Phantom Pattern Problem (2020) by Gary Smith and Jay Cordes as one of the top books of 2020 in the science and tech category. Auerbach, who describes himself as “a writer and software engineer, trying to bridge the two realms,” is the author of BITWISE: A Life in Code (2018). He has an interesting way of choosing books to recommend: Those that resist the “increasingly desperate and defensive oversimplification” of popular culture: I hesitate to mention too many other books for fear of neglecting the others, but I will say that of the science and technology books, several deal with subjects that are currently inundated with popularizations. In my eye, those below are notably superior…

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Yellow Fingers Do Not Cause Lung Cancer

Neurosurgeon Michael Egnor and computer engineer Bob Marks look at the ways Big Data can mislead us into mistaking incidental events for causes

It’s easy to explain what “information” is if we don’t think much about it. But what if we ask a student, what does your term paper weigh? How much energy does it consume? More or less matter and energy than, say, lightning striking a tree? Of course, the student will protest, “But that’s not the point! It’s my term paper.” Exactly. So information is very different from matter and energy. It means something. Realizing that information is different from matter and energy can help us understand issues like the difference between the causes of a problem (causation) and circumstances that may be associated with the problem but do not cause it (correlation). In last week’s podcast, “Robert J. Marks on…

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AI Is Not Nearly Smart Enough to Morph Into the Terminator

Computer engineering prof Robert J. Marks offers some illustrations in an ITIF think tank interview

In a recent podcast, Walter Bradley Center director Robert J. Marks spoke with Robert D.Atkinson and Jackie Whisman at the prominent AI think tank, Information Technology and Innovation Foundation, about his recent book, The Case for Killer Robots—a plea for American military brass to see that AI is an inevitable part of modern defense strategies, to be managed rather than avoided. It may be downloaded free here. In this second part ( here’s Part 1), the discussion (starts at 6:31) turned to what might happen if AI goes “rogue.” The three parties agreed that AI isn’t nearly smart enough to turn into the Terminator: Jackie Whisman: Well, opponents of so-called killer robots, of course argue that the technologies can’t be…