Editor’s note: Today, we’re sharing part two of Casey Research founder Doug Casey’s recent essay on the next industrial revolution.
Yesterday, Doug shared the 10 big trends that are rapidly advancing. Today, he explains how to set yourself up to benefit as directly and immediately as possible.
You may think I’m pulling your leg and that I’ve gone too far in these projections. But this isn’t just a titillating compilation of cover stories from Popular Science magazine. Our brains are accustomed to thinking arithmetically—1, 2, 3, 4, 5, 6, etc. But technology is compounding geometrically—1, 2, 4, 8, 16, 32, etc. You’ve seen this happen in the realm of computing and electronics just in our lifetimes. But—partially enabled by those things—it’s happening in many areas.
You might analogize this to what happens to water as it gets colder. There’s not much difference between water at, say, 45 and 33 degrees Fahrenheit. But once it gets to 32, it has a change of state, a transformation in what it is, its very nature. And it happens very, very quickly.
The advances being made are the stuff of science fiction. In fact, sci-fi has long been a much better predictor of the future than think tanks, futurists, or even the best scientists. I’ve often wondered why this is the case. As someone with solipsist tendencies, I’m partial to believing that anything you can conceive of can probably be done. And anything that can be done will be done. The transformation of reality itself is just a matter of having sufficient matter, energy, space, and time added to technology. When you see it that way, you have to be intensely optimistic. And I am. In fact, for the first time, advances in the real world are starting to outrun the imaginings of sci-fi.
Skeptics might counter: “Sure. Given enough time, everything happens eventually. Including the heat death of the universe.” And they’re right.
But because of the exponential rate of improvement in the things I’ve mentioned and some others I haven’t, I suspect we’re about to have a change in the state of existence. This is what Ray Kurzweil, Google’s chief technology officer, has dubbed “The Singularity.”
Go back to the things I listed. The really important things—computers, AI, robotics, nanotech, and bioscience—are all advancing according to Moore’s Law. Doubling every 18 months, with costs dropping 50%. Things move very quickly when they move at an exponential rate. Extrapolating them only 10 years into the future, which implies only eight doublings. And eight doublings result in 256 times the starting point.
There’s a good chance they’re all going to come together at once. Exactly when might that be? This is the tricky part, predicting the time as well as the event. Kurzweil thinks about 20 years from now. If he’s right, this is not only good news. It is, by orders of magnitude, the best news of any type in human history.
What might the bad news be? You may (quite logically) be thinking about some unsavory implications of these advances. The evolution of Skynet and Terminators. People failing to reproduce. Grey goo from runaway nanotech covering the planet. Humanity destroying itself in all manner of ways. I agree that bad things can happen. It’s not just a question of misfeasance, some unforeseen accident happening. But actual malfeasance isn’t out of the question.
Why? Technology is advancing exponentially, but human ethics don’t seem to be advancing at all. In fact, maybe the general moral tone of humanity is actually degrading. If that’s true, then you can argue it’s a bad idea for large-brained chimpanzees to have the magic technologies we’ve been discussing.
So, of course, some people will say: “We have to slow down this mad rush to the future! We have to at least regulate these scary things!” Sound reasonable? Actually, no; the concept is incredibly stupid. You might also ask who the “we” is that wants to make those decisions. Of course, it’s the same professional busybodies who are naturally drawn to government, NGOs, media, and the like. They’re not the best and brightest, as they like to believe. They’re actually the worst and most dangerous of mankind, and they’re always fearful of progress.
Why? Because although the leaders always get new technologies first (e.g., horses, gunpowder, computers), the cat always gets out of the bag, and these things act to further liberate the average man after a while.
Notwithstanding various drags on our progress, mankind has been expanding its powers exponentially since about the time it learned to make fire. But the nature of the math is that the real growth doesn’t come until the end, at which point it seems instantaneous. We can see what’s happening intellectually, but very few can picture it in reality. Recall the fable about the mathematician who invented chess and got a king to reward him by giving him double the amount of wheat for each of the 64 squares of a chessboard, starting with one grain. How much grain might that be? The answer is over 18 quintillion grains, which is around 1,000 times the world’s annual production of wheat. It’s counterintuitive because intuition can’t deal with geometric increases beyond a low level.
It’s idiocy to try to curtail the rewards of a process—and here we’re talking about the Ascent of Man itself—at the very moment of triumph. Maybe humanity is now (wild guess) at around the 50th chessboard square. Exactly where things start getting interesting.
It’s been said that any sufficiently advanced technology is indistinguishable from magic. But there’s a big problem for you and me as individuals. At the moment, we all have very finite lifetimes. What if (even though medical advances are extending our life expectancies radically) we die before magic happens?
That’s why there’s absolutely nothing to be lost by going for the brass ring.
Let’s consider mundane life the way it’s always been and still is. Unless things change very quickly for the better, you’re going to be dead sometime in between tomorrow morning and, if you’re both young and lucky, 50 years from now. Considering the (current) absolute and total certainty of death, taking any risk to avoid it, even with long-shot odds, doesn’t just make excellent sense. It’s imperative.
So I’m not particularly concerned with the possible ultimate consequences of runaway technological advance. In fact, I think they’re almost all good, even if they’re a little scary. And now, for the first time in history, the inevitable is imminent. We can deal with potential problems when the time comes. Right now, I’m only concerned with things that might stop us from getting there in a reasonable (i.e., a fraction of a lifetime) time frame. But it’s entirely possible that humanity could blow it.
How might we blow it? In decreasing order of probability, you can worry about a lot of things. You can worry about a bus hitting you tomorrow morning. Or a pandemic. Or a super volcano. Or an asteroid strike, for that matter.
I’m most concerned about human-caused (anthropogenic, if you will) possibilities. Like World War 3, recalling that Einstein said he didn’t know what weapons would be used in it, but he was confident that sticks and stones would be used in WW4. That would put a stop to the advance of technology for a while, in addition to its other unpleasantness and inconvenience.
I’m also concerned about the consequences of the next phase of the Greater Depression. We entered the leading edge of the economic hurricane in 2007. We’ve been in the eye of the storm since 2010. And now, we’re going into the trailing edge.
No one can tell you exactly what it will be like. Very possibly, both catastrophic deflation and hyperinflation in sequence (in any order). Or in different parts of the economy at the same time (basic foodstuffs skyrocketing; the value of McMansions and BMWs collapsing). People with their life savings in dollars losing most everything. The State raising taxes hugely. All kinds of police-state measures being enforced in a vain attempt to restore stability. And a lot more things of this nature. It’s likely to last at least as long, be much worse, and much different even than what the world went through from 1914–1946.
This is extremely important because, you’ll recall, science and technology are only two legs to the tripod. Capital is equally necessary. And the Greater Depression, and its knock-on effects, could destroy a lot of capital.
One consequence of the Greater Depression might be that the tech trends I listed above will slow down radically. Less capital may be created and much less put aside for investment. Much could be misallocated. And the government always puts itself first; it may use what capital there is for its own purposes. Technology and science need as much capital as possible to advance as quickly as possible.
Vested interests, typically shortsighted, always use politics to fight innovation. Taxi drivers stupidly lobby against Uber; hoteliers lobby against Airbnb. They don’t see themselves as modern Luddites, but they are. Even worse, people may see some bad effects of technology and react against it. Under certain conditions, you could find scientists hunted down like witches for violating God’s will. Stranger things have happened in times of stress.
To be clear, I don’t think there’s such a thing as bad technology; people confuse the concept with its use by people with bad intentions. This is why I’m concerned about government using, or even financing, technology. I often talk about how the State is dangerous and destructive. But now, on the cusp of The Singularity, it’s true on a cosmic level. If, for instance, they delay a medical advance that may save you by a year, they may not be costing you a year. They may be costing you 500 years.
And it’s not just technology, but science itself that is in jeopardy. If it turns out that anthropogenic global warming is a gigantic hoax (I believe it is), even though it’s said that 97% of scientists believe in it (a lie), and that the science is settled (it’s not), that may discredit the idea of science to the average person. Anything is possible. After all, something like 40% of Americans think the world is about 6,000 years old and cavemen lived with dinosaurs.
Let me sum up. It’s likely we’re only 10, 20, or 30 years from what will turn out to be the biggest change in human history. I understand that sounds unbelievable to 99% of people. But I urge you to consider it seriously.
What does that mean? In fact, you might ask why investment results even matter if we move into an economy of total abundance. Almost everyone will benefit from these changes, at least indirectly and eventually, if they live long enough. But you want to benefit as directly and immediately as possible. Having capital will put you first in line. Having capital allows you to be an early adopter, and that could be critical.
Furthermore, earning capital makes you deserving of that place. Are the useless mouths on welfare deserving of these benefits? It may become a huge, and currently unanticipated, political issue over the next decade. There are huge numbers of hoi polloi out there—you’ll see them rioting this summer—who absolutely believe they deserve everything from free food, to free education, to a guaranteed income.
Editor’s note: As Doug mentioned, with all of these new tech trends gaining momentum, having enough capital on hand is key. And it’ll be even more important when the financial storm Doug is predicting hits…
To learn exactly what Doug says you should be doing today to prepare, click here to watch this free presentation.