Episodes

On this week's Stansberry Investor Hour, Dan and Corey are joined by Dr. John Sviokla. John is an author, executive fellow at Harvard Business School, and co-founder of GAI Insights – the world's leading generative artificial-intelligence ("AI") analyst firm. He joins the podcast to talk all things AI – its investing potential, limitations, and real-world applications.

John kicks off the show by explaining how GAI Insights is helping organizations and communities understand and use generative AI. Currently, many executives don't know enough about it to even recognize its opportunities in the workplace. John says that workers whose jobs involve words, images, numbers, and sounds ("WINS") will be the most impacted by this technology. He also breaks down the three new forms of capital: network, behavioral, and cognitive. When it comes to the latter, businesses are trying to protect their proprietary data and processes today by keeping their AI behind firewalls...

The sequence of how you analyze a problem is actually really complicated. Which models do you use when to find the signal that will give you the answer? Do I do the principal component analysis first? Do I do the regression analysis first? How do I manipulate this data so I can find the signal? It's a lot of expertise in that. You do not want to teach the large language models how to do that stuff.

Next, John talks about how these AI models are trained, the process of training workers to use AI, and the limitations of AI. One such area AI struggles with is creating new ways to look at a problem. However, it's surprisingly good at empathizing and mimicking human emotions. John then discusses AI's computability, the transformer algorithm, and how AI could impact the broad market. He notes...

We've done an analysis with the assistance of Valens Research, and we've looked at which companies are WINS intensive. And we think about 50% of the market cap and 50% of the profit of the entire publicly traded market is up for grabs with generative AI and AI.

Finally, John describes the four levels of generative-AI adoption. Those in the top level – "intelligence leveragers" – drive value by using AI to build AI. Right now, technology is the only industry with these kinds of companies. But John says that in the next five to seven years, each major industry will have an intelligence leverager. This presents a huge opportunity for investors. John gives several real-world situations across different industries (like pharmaceuticals and financials) where AI implementation will be game-changing. He says, for example...

Pfizer is very adept and advanced in the way that they're applying AI. And if you think about the economics of drug discovery, if [they can improve their odds] even a little bit, that's hugely valuable in their business model.