In 2001, Ray Kurzweil wrote an essay describing his law of accelerating returns.
His theory is simple, though it shakes the very foundation of all we know.
Here is his first paragraph:
An analysis of the history of technology shows that technological change is exponential, contrary to the common-sense “intuitive linear” view. So we won’t experience 100 years of progress in the 21st century — it will be more like 20,000 years of progress (at today’s rate). The “returns,” such as chip speed and cost-effectiveness, also increase exponentially. There’s even exponential growth in the rate of exponential growth. Within a few decades, machine intelligence will surpass human intelligence, leading to The Singularity — technological change so rapid and profound it represents a rupture in the fabric of human history. The implications include the merger of biological and nonbiological intelligence, immortal software-based humans, and ultra-high levels of intelligence that expand outward in the universe at the speed of light.
Fifteen years ago, Kurzweil predicted the speedy rise of smartphones, DNA sequencing, nanotechnology, the cloud, robots, global GDP, U.S. patents granted, and much more.
The idea of the Singularity has crossed from theory into legend. At some point, the reality will cross the point of no return, and how we come to understand and use computer systems will be out of our control.
At least that’s the theory. I don’t know about all of that.
But what seems obvious is that the rate of change in the world is speeding up.
Speed Profits
I’m not here to get into abstract philosophical discussions on the future of cyborg humanity. Today, I want to talk about what’s going to happen next year and how you can profit from it.
I’m talking, of course, about driverless or autonomous cars. When I write that, I think it is already old hat. We’ve been hearing about these cars for years. Google has driven almost 2 million miles on real road conditions. All of the top-name carmakers from Ford to Mercedes-Benz have auto-autos.
Park-yourself systems, blind-spot warnings, auto-breaking, accident avoidance, and many more features are ubiquitous. These are on top of the old standards such as traction and cruise control that we’ve had for years. What comes next is how these systems react to one another and how to make them cheap enough for the masses.
First of all, you should know that autonomous cars are an evolutionary event, not a revolutionary one. Each system is built on the preceding one. It’s not like some eureka moment by a guy in a shed where the world changes in an instant. That said, everything technological we need for these cars we already have. We just have to put it all together.
More on that in a minute. Let me tell you why we want them.
Benefits
Autonomous cars have a lot going for them. They use less fuel, are much safer (50% to 90% fewer accidents), speed up traffic flow (by a factor of four), allow for true on-demand rental (your next car could be the last one you buy), and let the driver relax to do work or even have a cocktail.
All you need for autonomous cars we already have. Google, for instance, uses sonar, radar, camera, GPS, Google Maps, and 64 rotating laser beams taking more than a million readings a second that are digested by a 3D computer brain.
Google’s price for all of this is $75,000, but the company is saying it will have the price down for people to afford it by 2018. That’s just two years away.
And like I said, the game is moving fast. Audi is running an autonomous racecar that gets better at every lap. It will soon make current professional drivers look like John Henry.
Our analysts have traveled the world over, dedicated to finding the best and most profitable investments in the global energy markets. All you have to do to join our Energy and Capital investment community is sign up for the daily newsletter below.
Mercedes
Autonomous trucks are being tested on the Autobahn. They will come to the U.S., and within 10 years, you’ll be lucky to find a long-distance truck driver that is still employed. This is a big deal, as there are 3.5 million professional truck drivers in the United States. 8.5 million people work to support the truck-driving industry.
It is one of the last well-paying job for those without a college degree, and in many states, it employs the most of any job.
Many states and the federal government see what is coming down the pike and are gearing up for the change.
According to Wired:
Starting with 2019 model year cars, NHTS will take active technologies into account when determining its ratings.
These are features like forward collision warning, automatic emergency braking, and blind spot detection. They’re among the most advanced ways of keeping people out of crashes.
The proposed changes are part of a sweeping modernization of a system.
If you’re looking for a robot to take the wheel, this is encouraging. Active safety features are a basic building block for autonomous technology, since they take over control of the car in emergency situations. Getting those features into more cars will help vet their development, drive down costs, and get the public used to the idea of the machine doing the work.
I could keep going, producing more and more evidence that driverless cars are inevitable and will arrive sooner than you anticipate. It is an evolutionary product that is halfway here.
The question is how to make money by investing in this sweeping change to the automobile industry.
Contrary to technological jockstrap sniffers, it won’t be the Teslas or the Googles (I’m sorry, Alphabet) that are the big winners in this game. Nor will it be Ford, GM, or Toyota. Those companies are too big for these new technologies to make a marked difference on their bottom line.
No, the big winners will be smaller companies that make the hardware like the semiconductors for the laser light sensors and/or the software that integrate these systems and sell them to the well-established auto manufacturers that we all know and love.
Make no mistake; technology for the car market is growing at 10 times the rate of the car market itself. In the next 36 months, there will be $2 trillion in demand for new car technology, according to research firm IDC.
The time is now to invest in companies that will not only profit from the driverless car tends but also transfer that money back to investors through share price appreciation.
I’ve written up a detailed report on this topic, including the companies that will come out on top. Keep your eyes peeled for it next week.
All the best,
Christian DeHaemer
Check us out on YouTube!Christian is the founder of Bull and Bust Report and an editor at Energy and Capital. For more on Christian, see his editor’s page.
