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Back to Cliff Sosin - Owning the Complements to Intelligence, with Cliff Sosin.

Does a Person Working With an AI Model Beat a Person or a Model Alone?

Cliff Sosin says a person working with a model now beats either one alone. Computer-aided chess had a long stretch of freestyle chess, where the human plus the program out-competed the human alone and out-competed the computer alone, because each side thought differently and the mix was synergistic. Investing is in that era.

A person still understands things a model misses by having lived a life, and not everything is on the internet. Using a model and then judging makes better judgments while the gap remains, which he thinks will last a while. Later the gap can shrink until it does not matter. Models will not predict the future, because the future is intrinsically unpredictable, but the model's distribution of outcomes may be the best forecast available. Adding his judgment would then be like adding a view on rain in seven days: people would ignore Cliff and use the forecast, since fudging it makes the forecast worse. The day may come, in his view.

Models might also interview managers and judge them. He pictures someone who wants to run an amusement park. The model names six locations with a 51% chance of an amusement park working, rates the person at a 51.2% chance of succeeding because the person is slightly below average, and suggests a go-karting park. He does not think the shift will affect his career much, because it will take a while.

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Cliff Sosin - Owning the Complements to Intelligence ·

Invest Like the Best with Patrick O'Shaughnessy

More from this episode

  1. Why Can't Even Superintelligent AI Predict the Future?Cliff Sosin says even superintelligent AI cannot predict most of what people want to know, because complex systems amplify tiny errors until a forecast falls…
  2. Who Makes Money When AI Intelligence Gets Cheap?Cliff Sosin says the businesses that benefit when intelligence gets cheap own the complements to intelligence, not the intelligence itself.
  3. When Do Price Cuts Shrink a Market?Cliff Sosin says a market shrinks once further price cuts stop creating enough demand, and a price of zero takes the market size to zero.
  4. When Does AI Reach Its Limit?Cliff Sosin says the limit arrives after the papers are finished.
  5. Why Does AI Infrastructure Get Overbuilt?Cliff Sosin says AI infrastructure gets pushed until it is overbuilt because a strong price signal is what makes a buildout of a huge technology possible at…
  6. Will AI Agents Push Customers to the Lowest-cost Provider?Cliff Sosin says that once people hand routine choices to an AI agent, the customer moves to the lowest-cost provider. He puts decisions on a spectrum.
  7. How Much of the Economy Moved Into AI?Cliff Sosin says American capital markets redeployed 3% of GDP into a highly speculative AI venture on the turn of a dime.
  8. How Does Cheap AI Affect Income?Cliff Sosin tells two stories about how cheap, ubiquitous intelligence affects wealth and income distribution.
  9. Why Is Cliff Sosin Comfortable With 80% of His Portfolio in Carvana?Cliff Sosin is comfortable keeping most of his portfolio in Carvana because he thinks about the stake the way an owner thinks about a company, not the way a…
  10. Why Should Kids Learn Math Without AI?Cliff Sosin argues that children should learn foundational skills apart from models so they can direct a model.

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