September CRU: Markets, Machines, & the Race to Stay Ahead

Being an investor hasn’t been much fun lately. After a very challenging July, August looked to be strong again … for two days. Earnings results from a number of mega-cap technology companies briefly reassured investors, but the summer doldrums hit and the markets felt directionless.

Some of the biggest moves were in assets that have little fundamental value but provide a place for (especially retail) investors to wait-and-see: gold, silver and bitcoin, up 9%, 22% and 25%, respectively, for the month.

Being a human being has been a bit stressful, too. After a number of concerning cases of artificial intelligence (AI) companies losing control of their AI agents, leaders of the four largest AI companies have come out in agreement that the field is moving dangerously fast. I mean, if the experts can’t control the technology, I’m afraid to imagine what it could do in the hands of a malicious actor. Or my teenager, the next time I decline to let him borrow the car.

But not to worry – ever ready to offer his expertise and energy, President Trump explained through social media that the only oversight needed “is a STRONG AND SMART (High IQ!) PRESIDENT…”, helpfully clarifying that “the U.S.A. has that, in spades.” Call me a worry wart, but I’m not fully reassured.

In part, that’s because the President also referred to a conspiracy including China that wants US AI to slow down and is trying to influence public opinion in that direction. There is significant evidence that is true.

It would all feel a bit Manhattan Project-ish, except that the key players feel less … serious? And the control is in private hands, along with the trillions of dollars of wealth if the US AI companies press forward and go public.

So AI, particularly the investment in “compute,” is unlikely to slow. Which means that investments in, for example, AI-focused semiconductors, high-speed memory, optical networking and other cutting-edge AI-enabling technology will likely continue to rise.

At least until the AI agents figure out how to make their own!

Disclaimer: The information provided is for educational purposes only and is not intended as investment advice. Past performance does not guarantee future results. Investors should consult with a qualified financial professional before making any investment decisions.