Deep Thoughts from NYC

First off, we'll do the Live Q&A Chat at the regular time (noon ET on Wednesday, January 15, 2025) in the Discord Channel or you can email your questions to support@tradingwithcody.com.

Also, in case you missed it, here's Cody's appearance on Fox Business from last week:

Bryce here. When we were in NYC last week Cody asked that I write down any deep thoughts I/We had during the week so that we could share those with you all. We send out a lot of deep dives and in-depth analyses here at TradingWithCody.com and it's high time we get back to also sharing our one-off deep thoughts that captivate us from time to time. We were very busy in NYC as we met with many interesting and captivating people as always so this list is a little longer than the ones we plan to send out going forward. To be clear, some of these are almost verbatim quotes from people we met with in New York. Now, let's get into it!

• How long will it be before I can train my own AI by sharing my computer screen with it? I'm thinking that sometimes I will say something like “watch what I do on the screen,” do it five or ten times, and then see if the AI can do it. These custom AIs will make knowledge workers extremely more efficient and help solve many edge cases that general-purpose AI may never solve.
• Everyone thinks rising inflation could be a problem. That might mean higher inflation is getting close to priced in at this point.
• If The AI Revolution becomes as big as we think it could be, it changes everything. It changes the dollar, interest rates, debt levels (at the national, corporate, and individual scales), earnings, U.S. preeminence, literally everything.
• If The Robotics Revolution becomes as big as we think, it not only changes everything, it changes the basic premise of economics that, as Karl Marx once put it, labor is everything.
• Nobody is discounting the value of robots into Tesla's valuation right now. There are so many things the robots will be doing someday, from serving coffee to operating construction lifts. They will do nearly everything, nearly everywhere.
• Our long-held belief that we should “always bet on technology driving endless deflationary trends” goes hand in hand with our recent epiphany that “in the long run, efficiency always wins.”
• AI will likely drive more internet searches, not less like most everyone is picturing right now. Even though Google might monetize search differently in the future, Google has the best search engine and all of the AIs will want to use Google as their default platform for search. Google and Microsoft's Bing are the only two remaining proprietary search engines.
• Eventually, the internet could become solely a resource for AIs, not humans. Developers will build websites for what AIs need, not for what humans need.
• The entire tech stack of companies like Google, Apple, etc. that deal with apps, operating systems, hardware, and semiconductors along with all of the interfaces between those (like pytorch) will disappear as The AI Revolution reaches its ultimate endgame. That is, humans via AI will interact directly with semiconductors in twenty or thirty years. It's like steering wheels being removed from self-driving cars, with robotaxis, we no longer need the steering wheel to interface with the wheels.
• It’s a feast or famine world (in technology, in money-making, in politics, in wealth disparity, in geopolitics, in everything). The winners win and are getting exorbitant wealthy while most everyone else struggles. 
• Investment diversification is sort of myth if you are in one asset class, and therefore the traditional idea of "diversifying" across a basket of stocks is sort of pointless. Diversification only works with assets that are not correlated. 
• Nvidia's Cosmos platform has the potential to replicate the physical world in the digital world using simulated/synthetic data. It's essentially like building a video game using real-world physics and then using that video game to train robots and self-driving cars in the digital world. Is this feasible? Can Tesla do the same thing? Can you truly simulate all aspects of the physical world in a computer? Perhaps, but also perhaps not.
• AI could drive an order of magnitude increase in the amount of software that is built, but that doesn't necessarily mean we will see an order of magnitude increase in the number of software developers, that also doesn't mean that we won't still need lots and lots of software developers in the future.
• Human attention is a finite resource.
• Ego is the enemy of the Holy Spirit.
• Almost all of Wall Street is on the same page of being underweight big tech stocks because they're "such a large weighting in the indices" and they are "relatively expensive." As such, they are piling their money into small and mid-caps (many of which are not profitable and/or not growing like big tech is). But there are good reasons why large-cap tech stocks are dominating this market: their earnings have grown immensely and they all operate global, high-margin platforms that dominate the real world. Maybe we should just keep on owning them like we have for the last 15 years or so? Most people think big tech has been too dominant for too long and surely other sectors should start working now. It's the same phenomenon that happens in roulette when people see that black has hit the last 20 times in a row and everyone is convinced that it has to land on red now, even though statistically that is not the case at all. As the Wall Street Journal's sports columnist Jason Gay put it last week when discussing the Kansas City Chiefs, Nvidia and big tech are almost a little underrated at this point.

That's it for now folks. Will have another update tomorrow. And don't forget about the Live Q&A Chat (noon ET on Wednesday, January 15, 2025) in the Discord Channel or you can email your questions to support@tradingwithcody.com.

We'll leave you with a few pics from our trip: