In today’s issue:
- Galaxy Invaders 10,000
- Zuck says this about DeepSeek
- AVGO or META? Who wins?
I’ve been going through the process of unpacking a lot of boxes after recently moving house.
The other day I got to a box that was about 1,000 Xmases all rolled into one.
In it was my click wheel iPod from 2004 (yes, it still works – thanks to some upgrades from me), my Sharp MD-MS722 portable MiniDisc player, several generations of smartphones from a Samsung S7 Edge to an iPhone 9, a Nintendo Entertainment System, a Super Nintendo Entertainment System, a PS4 Pro and one of my most prized possessions, a (also still working) Galaxy Invader 10,000 hand-held space game.
I promise I’m not a hoarder. I just love collecting old tech. OK, so maybe I’m an old-tech hoarder… 🤔
Point being, I do love to look back at some of this stuff because it gives perspective on where we are today.
We’re at the brink of humanoid robots in the home, fully self-driving cars shuttling us around and gigantic rockets being caught with chopsticks. Just the other day a prototype plane built with the vision of bringing supersonic plane travel back to consumers, broke the sound barrier for the first time.
We are advancing at great speed – and a fundamental part of that advancement is AI. There’s also a decent argument to be made that 2025 is going to see the most rapid and mind-blowing advancements we’ve ever seen in technology.
The equivalent pace would be more like Samsung and Apple releasing new Galaxy and iPhones every month, not every year (or so).
But just how fast is this coming?
Well here’s what the CEO (and founder) of Meta, Mark Zuckerberg, said on the company’s latest earnings call:
This is going to be a really big year. I know it always feels like every year is a big year, but more than usual, it feels like the trajectory for most of our long-term initiatives is going to be a lot clearer by the end of this year. So, I keep telling our teams that this is going to be intense because we have about 48 weeks to get on the trajectory that we want to be on. In AI, I expect that this is going to be the year when a highly intelligent and personalized AI assistant reaches more than 1 billion people, and I expect Meta AI to be that leading AI assistant.
One billion people is a lot. That is a big leap in use and adoption. Unless it’s pushed out without the need to buy a new device. After all, Meta isn’t doing devices at scale (yet, although I still think it will “win” AI with its smart glasses) but it is deep into the development of its Llama AI application.
Of course, behind Llama sits an untold amount of AI infrastructure. How much? Well, here’s what Zuck had to say:
These are all big investments, especially the hundreds of billions of dollars that we will invest to AI infrastructure over the long term. I announced last week that we expect to bring online almost a gigawatt of capacity this year. And we’re building a two-gigawatt and potentially bigger AI data center that is so big that it will cover a significant part of Manhattan if we were placed there. We’re planning to fund all of this by, at the same time, investing aggressively in initiatives that use these AI advances to increase revenue growth.
It was a very good earnings call. Particularly around how the company plans to aggressively use its investments in AI so far to increase the revenues to invest more into its AI build out.
He also talks about DeepSeek and learning from that. It’s also already pushing away from “prelearning” towards “inference”. This basically means it’s not trying to get the AI to learn as much, it’s trying to get it to actively reason, predict and think in better ways.
It also means nothing that happened this week is going to slow down Meta. It’s taken a decisively progressive approach (and financial bet) on AI. I think it’s a winning play, and it will also drag along other companies helping to build that out with them.
One of those being Broadcom. Meta develops its own “custom” silicon, the MTIA (Meta Training and Inference Accelerator). But it’s widely accepted this was developed in tandem with Broadcom, who is a key supplier of ASIC hardware (chips specifically good at a limited number of things, like processing).
Without getting into the weeds too much, after Meta smashed the earnings this quarter, and then after Zuckerberg and his team spoke about their expectation to “further ramp adoption of MTIA”, Broadcom went and popped 4.5% higher in after-hours trading.
This is how the AI market works. The big spenders outline their plans to build more, expand more, adopt and ramp up more of their AI infrastructure, then companies that actually help to provide that infrastructure shoot higher off the back of it.
Simple right?
Except for when China drops a fear-bomb on the market. But that’s overblown, as we know. From here, I think for both Meta and Broadcom the next move is up and higher.
Boomers & Busters 💰
AI and AI-related stocks moving and shaking up the markets this week. (All performance data below over the rolling week.) [Figures correct at time of writing.]
Boom 📈
- Lantern Pharma (NASDAQ:LTRN) up 15%
- Amesite (NASDAQ:AMST) up 13%
- Predictive Oncology (NASDAQ:POAI) up 8%
Bust 📉
- Vertiv (NYSE:VRT) down 25%
- Nvidia (NASDAQ:NVDA) down 15%
- Micron (NASDAQ:MU) down 12%
From the hive mind 🧠
- Great question! Who IS Liang Wenfeng?
- Err, I’m pretty sure OpenAI was being accused of stealing data to train its models. And now it’s upset that someone is stealing from them? If it’s all open source, imagine the real speed at which things would develop in AI!
- Meta beats, and Microsoft disappoints…
Weirdest AI image of the day
ChatGPT’s random quote of the day
Technology should do the hard work, so people can do the things that make them the happiest.
– Larry Page
Thanks for reading, see you next time.
Sam Volkering
Contributing Editor, Fortune & Freedom
God’s Work
Bill Bonner, writing from Baltimore, Maryland
So far, we’re only a couple weeks into Donald Trump’s second try at governing the USA… it’s everything we expected – and more!
Getting rid of DEI… abandoning the Energy Transition… closing departments and firing federal workers… pardoning Ross Ulbricht – yes, there are bright spots.
‘It’s time for it to die,’ said Elon Musk of the USAID. The agency ‘promotes democracy’ by undermining elections, engineering regime changes, spreading propaganda… and funneling billions of dollars to its chummy crony contractors. It should have been put to death a long time ago. And there are many other agencies that should be terminated along with it.
But there are some dark spots too – trade wars… drug wars… Panama, Greenland, and now Gaza! banning, prohibiting, sanctioning, tariffing… ignoring the Constitution… flights of fancy, doomed to crash… and lose-lose deals that make no real sense.
Here’s the latest:
Trump orders creation of a U.S. sovereign wealth fund
President Trump on Monday took the first steps toward his administration creating a government-owned investment fund, tasking the heads of the Treasury Department and Commerce Department with beginning the process to create an American sovereign wealth fund.
Uh…
Don’t you need some ‘wealth’ to create a ‘wealth fund?’ Norway did it with the money it got from North Sea oil. China’s trillion-dollar wealth fund comes from its trade surpluses.
Where will the US wealth come from? The government runs deficits… America’s trade balance is negative. And it has nearly $37 trillion in anti-wealth… aka debt.
Whatever ball Mr. Trump has his eye on, it ain’t the one that matters. In all the sound and fury of Trump’s executive orders and confrontations, there is scarcely any mention of the real challenge: avoiding a fiscal crisis.
But the nice thing about Donald Trump… the fresh air of his administration… is that he is so transparently rapacious. Almost everything he says is a lie, a mistake, or plain nonsense. But it is not gussied up with taffeta talk of the ‘rule of law’… the Constitution… or the ‘dignity of the Oval Office.’ All the claptrap and cupidity of an aging empire… like the painting of Dorian Gray… is finally on display. Pearls and Irritations opines:
What Trump is announcing to Americans and the world contains more than elements of a new security, economic, political and human rights order. He is essentially proclaiming a new Pax Americana charter to replace the United Nations charter which he, and it should be noted, together with other US presidents have consistently violated since the charter was established in 1945 but which none until Trump has explicitly repudiated.
Until now, America’s violence was cloaked in the hypocrisy of the 20th century. We were ‘making the world safe for democracy.’ We were promoting the globalized ‘liberal’ order… and protecting the world from fascism… and then, from communism… and later from terrorists. Donald Trump ‘tells it like it really is.’ We’re in it for what we can get out of it. And now, the whole world knows it. The Guardian:
Trump demands rare earths from Kyiv in exchange for aid
US reportedly briefly paused weapon shipments into Ukraine…
“We’re telling Ukraine they have very valuable rare earths,” Trump said on Monday. “We’re looking to do a deal with Ukraine where they’re going to secure what we’re giving them with their rare earths and other things.” Trump, speaking to reporters at the White House, said Ukraine was willing, adding that he wants “equalisation” from Ukraine for Washington’s “close to $300bn” in support.
Trump is bad. Trump is good. He is ‘destroying our democracy.’ Or, he is a genius, given to us (by God!) to make us great again.
Our own guess – an admittedly grandiose sweep of historical dot connecting – is that Mr. Trump is simply Mr. Trump… neither bad nor good… but just another one of history’s useful dupes. His real mission, of which he is entirely unaware, is not to save the empire, but to sink it.
God does not permit trees to grow to the sky… nor does He allow empires – no matter what their pretensions – to rule forever. All things made by man have a beginning… and an end. The Roman Empire needed its Augustus… and its Caligula.
And now, Donald J. Trump… Time’s ‘man of the year’… seems to be doing God’s work, hastening the end of American hegemonic power by turning much of the world against the USA.
This view is so out-of-step with the bulk of popular opinion… it must be either very wrong… or very right. Whichever. We’ll accept the verdict of history, when it is finally rendered.
Unless it goes against us.
Regards,
Bill Bonner
Contributing Editor, Fortune & Freedom
For more from Bill Bonner, visit www.bonnerprivateresearch.com
