Question: “David, when will the economic upheaval or shift you talk about, begin to happen?”
Answer: “It has already begun.“
Citing World Bank data, a brief from the United Nations Conference on Trade and Development (UNCTAD) claims that up to two-thirds of all jobs in the developing world could be replaced by automation in the very near future. Think about that for a moment. That’s huge news.
The brief specifically states that “The increased use of robots in developed countries risks eroding the traditional labor cost advantage of developing countries. If robots are considered a form of capital that is a close substitute for low-skilled workers, then their growing use reduces the share of human labor in total production costs.”
So what exactly are we talking about here and kind of timeline can we expect? Forbes reports that “half of the workforce is expected to be replaced by robotics in the next 20 years. Some go further and predict 80% of jobs to disappear in the next 10 years.” I have also read that at least 60% of the jobs that will exist in the near future have not even been invented yet. But Forbes continues and says “Such drastic change to the employment landscape is already starting to happen and is a real threat to the stability of the society.”
What I want you to understand is that robots are merely a part of a much bigger equation. Consider Artificial Intelligence for a moment. IBM is investing $1 billion in its Watson; Amazon has Alexa; Apple has Siri. Google, Facebook and Microsoft are all working hard on AI and robotics as well. The list goes on and on and AI is already being utilized in major ways. Media uses it to write stories, chances are that it is a part of your online shopping experience, and it is being integrated into many other applications from gaming to military aircraft. It’s going to get much bigger.
Kevin Maney may have said it best; “AI will lead us into the mother of all tech revolutions. The last time anything came close was around 1900, when the automobile, telecommunications, the airplane and mass electrification all came together at once, radically changing the world from the late 1800s to the 1920s.” He’s probably right and provides some insight from Surya Ganguli, a leading AI scientist at Stanford University, who recently stated that “Within maybe five years, AI will be better than humans at diagnosing medical images and better than legal assistants at researching case law.” Just imagine the ramifications and possibilities.
Now consider the bigger picture. Robotics are basically moral slavery and Artificial Intelligence will change everything else that robots are not tasked with. You will also see robots programmed with Artificial Intellegence. Scary. And when you consider things like the “Google Effect”, this tech stands to change everything that the human or human mind could do as well. This will be widespread. The economy is changing fundamentally, right before our very eyes. The way in which the world does business will be completely different moving forward. The way you live your life will be completely different. What I want to you wrap your head around is that it has already begun. Both robotics and AI are advancing at an extremely rapid pace. We are already seeing the integration in both military and private applications and jobs are already being replaced by these technologies; from restaurants and offices to factories and warehouses.
For those of you who have followed my work for a while, you know that I often speak of the “cycles” – a historical phenomenon that repeats itself with mathematic precision. The nearest economic upheaval was supposed to have started somewhere between 2005 to 2015. Consider this, in 2005, ASIMO began to walk as fast as humans and AI began its use in business applications such as marketing. Blue Brain, a project to simulate the brain at molecular detail, was also born in 2005. Since then, we have seen self-driving cars, Quill, Kinect, military and private drones, space robotics, things like Siri and Alexa, autonomous bipedal and mull robots, and so much more. Only now (oddly enough) are people beginning to see just how life-altering this tech will truly be.
I have said it before and I will say it again. The economic upheaval presents itself in a different way each time it presents itself, but that it presents itself with mathematic precision when it does. Kind of like how the Currency Act of 1764 helped spur a colonial desire for financial and social independence. This desire led to a complete transformation of global economics and politics. I believe this economic upheaval is no different. Just like any other upheaval, elements of this upheaval have been in the works for decades, but a few drastic measures have spurred the want and need for its rapid advancement.
And right on cue, the old way of doing business has become extremely unstable and things have been getting much worse in regard to global tensions. As Jim Sinclair says, “now we have a Fed whose primary indicator is starting to have a heart attack… When this thing comes down, it’s going to be a free fall.” Sinclair says, “When it’s all said and done, there will be a catastrophic big bang, and then the only thing that will be left is your savings account. Your savings account is not silver, although it will outperform gold, your savings account is going to be gold. It’s going to happen because all currencies, even the roaring dollar, are falling in terms of being a storehouse of value. Capitalism is finished. I can’t tell you what the next system will be, but capitalism is over because the heart of capitalism is markets. Without markets, you cannot have a capitalistic system—it’s over.”
This all sounds a lot like an economic upheaval to me. Plenty of other experts are using similar language. Peter Schiff uses the phrase “American Armageddon”, you’ll hear others say things like “house of cards” and so no. However, I see this as nothing more than a time of transition. Life was better after the Industrial Revolution, the railroad, and the Great Depression. It will get better after this too, but only after things get figured out.
Now for the bad news. Things will need to get figured out and these types of transitions are rarely smooth. Things like the lightening rod and the Currency Act segued into something nasty. Mass use of the railroad, telegraph, and the rubber tire segued into something nasty. Post World War I and the Great Depression segued into something nasty. Unfortunately, this Robotic, AI, Economic turmoil will segue into something nasty as well. Looking at it objectively, we should remember that things tend to get a little worse before they get much better. Look to Russia, Iran, China, North Korea, and so on for evidence of the coming nastiness. I would also expect something major to happen with our currency in next several years, be it hyperinflation or even a transition to digital.
The way I see it, we are walking into the turbulent side of the cycle. We may have very well identified the economic upheaval. What comes next will not be pretty, but we should all take heart my friends! That part will pass too and the other side might just be every bit as amazing as any other post-cycle era. We just have to want it bad enough.
Want More? Check out this study from Oxford: The Future of Employment