Artificial intelligence


“Sir, I think that I have at long last identified why the National Health Service is experiencing high levels of patient pressure, especially at the present time (“NHS ‘winter crisis’ dominates first PMQs of 2018”, January 10).


“My theory is that there has been a “Brexitosis” pandemic affecting certain sectors of the UK population, which is leading to an influx of visitors to doctors’ surgeries and, possibly, accident and emergency departments as well. From my observations the important symptoms are depression and irrational concern for the future — these are topics that have given rise to much comment of late in a broader context.


“In order to test this theory as soon as possible I would suggest that it would be very easy to establish a control group, all of whom would give up reading the Financial Times for a short period of time.


“The condition of this group could then be assessed after perhaps a couple of weeks and may then be directly compared with the symptoms of another similar group whose habits had not been changed at all.


“Furthermore the findings might then make a useful basis for one of the FT’s Big Read articles so that the NHS could potentially gain the benefit of the findings at the earliest opportunity.


“We should never forget that economic forecasting was invented to make weather forecasting look good.”


  • Letter to The Financial Times from Nigel Lanning of Chorleywood, Herts, UK, 19 January 2018.


At the time of writing, this 30 minute interview between Cathy Newman of Channel 4 News and Jordan Peterson had attracted just under 2 million views on YouTube. By the time you read this, it will almost certainly have broken the 2 million mark. And it deserves to, because it is a tour de force of quiet but firm intelligence mastering emotive dogma. As one Twitter correspondent put it,

It was a joy to watch, especially as he had to untangle her description of his opinion before then actually giving his opinion.

The topic of the debate happened to be gender politics, but it could have been about anything. The problem with our social media age is that it hands anyone with a Twitter account a megaphone. That doesn’t mean we are obligated to listen to them – but it does tend to mean that most of the more sensible discussions simply get drowned out by a discordant blizzard of noise. Whom the gods would destroy first get given the Internet.

Returning home from the office last Friday, we saw two more examples of a culture determined to share with the rest of us. One of them was on the second floor of a just erected new block. It was a bathroom with a floor to ceiling window, where the focal point – at least to those on street level – was the toilet. Not a bathroom for shy, retiring types. The other was just around the corner, where a hipster clad in shorts and nothing else was diligently working out on the rowing machine on his balcony. The temperature at the time was roughly zero. Mind you, he could have been a Geordie.

Most notably online, we have been given the keys to the kingdom, and we have abused the privilege. As the American biologist E.O. Wilson puts it,

We are drowning in information, while starving for wisdom


The real problem of humanity is the following: we have paleolithic emotions; medieval institutions; and god-like technology.

Nicholas Carr, in his 2010 book The Shallows, makes a compelling case for the Internet making us all stupid. He refers to the end of 2001,

a scene that has haunted me ever since I first saw the firm as a teenager back in the 1970s, in the midst of my analogue youth. What makes it so poignant, and so weird, is the computer’s emotional response to the disassembly of its mind: its despair as one circuit after another goes dark, its childlike pleading with the astronaut – “I can feel it. I can feel it. I’m afraid” – and its final reversion to what can only be called a state of innocence. HAL’s outpouring of feeling contrasts with the emotionlessness that characterizes the human figures in the film, who go about their business with an almost robotic efficiency. Their thoughts and actions feel scripted, as if they’re following the steps of an algorithm. In the world of 2001, people have become so machinelike that the most human character turns out to be a machine. That’s the essence of Kubrick’s dark prophecy: as we come to rely on computers to mediate our understanding of the world, it is our own intelligence that flattens into artificial intelligence.

The message that we took from Yuval Noah Harari’s Sapiens is that human beings are hard-wired to believe in stories. The defining characteristic of the Internet is that it enables those stories to spread at the speed of light. But that doesn’t make them any more likely to be true.

If there is any one profession collectively suffering from Stockholm Syndrome as a result of overlong exposure to stories, it is economics. Or perhaps it suffers not so much from a false belief in stories than a false belief in models. Claudio Borio, Head of the Monetary and Economic Department at the Bank for International Settlements, has just written what amounts to a mea culpa of the limits of models.  The short version: central bank meddling in interest rates has unintended consequences, and one of those consequences is the rise of zombie companies that would die a natural death if interest rates had been allowed to normalise. (Another unintended consequence of unnaturally low interest rates is the meteoric rise of things like bitcoin, that would find sponsorship altogether more difficult if investors could rub along by earning a decent amount of interest on deposit – but bitcoin seems, finally, to have discovered the laws of gravitation.)

What stories are motivating US equity investors in 2018 ? Given that the S&P 500 has just extended its streak of trading days without a 5% reversal to 395 – the longest since the launch of the index in 1927 – even as the US government shuts down, Requiem for a Dream is a plausible candidate. Having long shied away from US stocks on valuation grounds, we clearly called that one wrong. That said, we haven’t been hiding fruitlessly in cash – Japan has been a useful substitute, and one that remains inexpensive by comparison with either the US or Europe. Given that the fat lady is tuning up in the bond market, in the final analysis we favour searching for high quality listed businesses and then trying not consciously to overpay for them. Given the sometimes glaring distinction between entire markets and individual companies and regions, we think there are still plenty of opportunities out there. But the chances are, there aren’t so many popular stories about them. Not yet.

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