🤖📈 How financial markets could predict the arrival of artificial general intelligence

Interest rates offer a possbile way of forecasting the state of AI timelines

Quote of the Issue

“Radioactive monsters, utopian atom-powered cities, weird ray devices, and many other images have crept into the way everyone thinks about nuclear weapons and power plants. The images, connecting with major social and psychological forces, have exerted a strange and powerful pressure on our history. This is no story of things locked away safely in the past: the images are as strong today as ever.” - Spencer R. Weart, The Rise of Nuclear Fear

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The Conservative Futurist: How To Create the Sci-Fi World We Were Promised

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The Essay

🤖📈 How financial markets could predict the arrival of artificial general intelligence

When will artificial intelligence/machine learning, especially the new generative AI models, have a massively transformative effect on the American economy — if ever?

Well, don’t expect a big impact this year, according to MIT economist Daron Acemoglu, someone whose research efforts center around the economic impact of new technology. In a new essay for Wired, “Get Ready for the Great AI Disappointment,” Acemoglu argues that after so much hype in 2023, most notably with ChatGPT, this year will see a reality check. Nothing particularly groundbreaking here from the noted economist, but certainly worth noting. He thinks efforts at mitigating the tendency for large language models to generate “hallucinations” will prove a harder task than many optimists think, undermining the technology's impact on boosting business productivity. It will take longer than expected for companies to figure out “which human tasks can be augmented by these models, and what types of additional training workers need to make this a reality.”

Not surprisingly, then, Acemogul doesn’t see human-level artificial general intelligence as happening anytime soon. From the essay:

Anticipation that there will be exponential improvements in productivity across the economy, or the much-vaunted first steps towards “artificial general intelligence”, or AGI, will fare no better. … Some people will start recognizing that it was always a pipe dream to reach anything resembling complex human cognition on the basis of predicting words.

Hints of our AI future from Wall Street

Of course, there are plenty of folks who see things differently, both in terms of near-term productivity improvements and the possibility of recent advances leading to AGI within a decade or so. I’ve been compiling such forecasts over the past year, including those by technologists, economists, and prediction markets.

And speaking of markets, what about looking to financial markets — vast, dynamic calculating machines that aggregate and analyze information — for signs of an emerging Age of AI?