By Doug Casey, founder, Casey Research
A while ago, it occurred to me that at least two expressions of technological progress – Moore’s Law and Metcalfe’s Law – have applications far beyond the electronic world, where they originated.
Moore’s Law is the observation that the number of transistors that can be placed in a dense integrated circuit doubles approximately every two years.
The idea was advanced by Gordon Moore, co-founder of Intel, in 1965, and has proved so accurate that even some people on “Jay Walking” have probably heard of it.
Moore’s Law is very important. If it holds for another 10, or at most 20 years, it will inevitably lead us to Ray Kurzweil’s Singularity. That’s when artificial intelligence will equal human intelligence, and will continue to compound. The consequences of that are very hard to predict. But they’re likely to change the nature of life itself. It’s cause for either immense optimism or dire pessimism. Or both – in sequence, or simultaneously.
In two articles that appeared here last year, I tried to make the point that Moore’s Law was actually too conservative (here and here). It shouldn’t just be applied to computing power in today’s world. We shouldn’t just be looking at the density of transistors on a chip. It seems to me that a broader version of it has been in action since the early Paleolithic, several hundred thousand years ago.
Moore’s Law deals with a narrow and very, very recent subset of the information revolution. Let’s say, if we think in terms of “Big Picture Moore’s Law,” the technological revolution really started about 200,000 years ago when men learned how to knap flint and make primitive hand tools. Then, say, 150,000 years ago the spear was invented. Then 75,000 years ago, with the discovery of how to make fire with flint or friction, men started moving out of Africa. Another 10,000 years go by and the bow was invented. Perhaps another 5,000 years later the dog is domesticated. Progress was glacially slow, with tens of thousands of years passing from one invention to the next. Then, by the late Paleolithic, the pace picked up to just thousands – not tens of thousands – of years between major innovations. 95% of our existence as a species was in the Paleolithic.
By the time the last Ice Age came to an end about 12,000 years ago, aided by these technological advances, men had spread throughout the planet. And the warming climate (global warming has been a trend since the end of the last Ice Age) allowed technology to move faster. Simple farming signaled the start of the Neolithic, 12,000 years ago. Domestication of cattle and pigs occurred 10,000 years ago. The invention of pottery happened perhaps 9,000 years ago, which in turn enabled the invention of beer and wine. The invention of cloth occurred 8,000 years ago. Then came stone architecture. Innovations doubled and redoubled the amount of technology and wealth – slowly at first, but always picking up speed.
Then cities, and the invention of writing, appeared 5,000 years ago. At that point the technological cat was truly out of the bag, because with cities and writing a proto version of Metcalfe’s Law came into existence.
Metcalfe’s Law states that the value of a telecommunications network is proportional to the square of the number of connected users in the system. It essentially means that although one telephone is useless, two telephones have real value. And each additional phone makes all the others exponentially more useful and valuable.
As with Moore’s Law, let’s apply Metcalfe’s Law not just to electronics, but to people. One person has a hard time surviving in a primitive environment. Two people don’t just double their chances of survival and progress, but at least quadruple them. By the time you have enough people to form a city, you have a market, with specialization and division of labor.
These two “laws” don’t just apply to media and electronics in today’s world; I believe they’ve always applied to technology. And the ascent of man itself.
Despite the setbacks caused by wars, pogroms, persecutions, regulation, taxation, and other political stumbling blocks, progress continued. Developments compounded on each other, more and more of them, and with less and less time between them. The Bronze Age started 5,000 years ago, the Iron Age 3,000 years ago. The Scientific Revolution 500 years ago. The Industrial Age 200 years ago. Since then major breakthroughs have been made at an accelerating rate. Not every 10,000 years, or every hundred years, or every year. But every day.
The terms “future shock” and “information overload” were coined in the ’60s. That was appropriate, because those phenomena didn’t exist before then. Even then, those terms were just predictions, not day-to-day reality, which is now the case.
So what’s the takeaway from this brief romp through history? It’s that the technological advances we’ve seen in the last few decades aren’t anomalous. They’re part of a trend that’s been in existence as long as mankind has existed. But, since we generally only live seventy or eighty years, they haven’t been very evident to us as individuals. In preindustrial times – only four lifetimes ago – technological change was slow and trivial. No more.
Here’s the analogy I like to use: Imagine you’re sitting in a stadium. A drop of water appears in the middle of it. You don’t even notice it. An hour later it doubles; you still don’t notice it. Thirty minutes later it doubles again, and 15 minutes later it doubles again. You won’t notice that the stadium is going to be flooded, and you’re going to drown, until it doubles the last few times. Which will happen in a fraction of a second. And right now you can just see there’s a film of water on the floor of the stadium.
The biggest changes by far are about to come, and very, very quickly. Teenagers using CRISPR in their parents’ garages will invent new species, and change the world much more than Bill Gates or Steve Jobs did. Those inventions will integrate with computer and sensing power far beyond what now exists anywhere. Biological robots will be hard to distinguish from humans. Nanotechnology, the construction of machines on an atomic level, controlled by microscopic super computers, will come into its own… and take things to the next level. Even things like the mass migrations of scores of millions of people, the collapse of nation states, and World Wars 3 and 4 will pale in comparison.
It seems unbelievable, I know. But trends in motion tend to not only stay in motion, but accelerate. And these trends seem to have a life of their own… a thought which brings up other philosophical questions. But a more practical question for the moment is: What should you do about it?
Other than the obvious basics like stay healthy and stay sane, the most important thing is probably to grow your wealth as fast as you can. You want to be able to stay ahead of the trend, so as to both insulate yourself from the bad things to come, and be in a position to capitalize on the good things.
That, and be prepared to watch a most… interesting… show in the near future.
Founder, Casey Research
Editor’s note: As Doug said, technology is developing at a rapid pace… and Disruptive Profits senior analyst Marco Wutzer just released an urgent video update on what he believes is the next breakthrough.
In short, a tiny $10 million company is on the verge of disrupting a $2.9 trillion market. It’s rolling out a bleeding-edge technology that fixes a “deadly flaw” in our national security. And the profit potential for those who get in now is off the charts.