Hello, Reader.
At last week’s The Road to AGI Summit, I spoke about a technology so powerful that its existence could either herald the end of the world – or, at the very least, the world as we know it – or usher in the beginning of an unprecedented utopia.
That development is Artificial General Intelligence, or AGI.
At the event, we discussed…
- How Wall Street is asleep at the wheel despite us being on the cusp of AGI’s advance…
- Big names that are racing to be the first to plant their flag on the new frontier of AGI…
- And my “futureproof” blueprint for a world of rapidly accelerating AI.
You can click here to access it all right now.
During the event, I received a bunch of good questions about AGI and my blueprint.
And, while The Road to AGI Summit may be behind us, we’ve only just begun traveling down that path. That is why, in today’s Smart Money, I will be answering some of your questions.
Let’s dive into your questions…
When will AGI become mainstream?
Scientists and other bright minds have put forth a few different timelines as to when they believe AGI will be developed. For example…
- Leopold Aschenbrenner, a former mathematician at OpenAI, has said that he already started to feel AGI back in 2023.
- Elon Musk believes that an AGI breakthrough could surpass human intelligence by the end of next year, and then surpass the intelligence of all humans combined by 2029.
- And Shane Legg, cofounder of Google DeepMind, believes that there is a 50% chance that AGI will be achieved by 2028.
The truth is that we really don’t know when AGI will become a part of our lives. However, the common denominator here is that the technology is developing fast… and will be upon us soon.
What industries will benefit the most from AGI?
AGI is going to impact several industries in ways many folks — including those on Wall Street — have never even considered. They are industries that I also believe everyone should consider investing their capital in right now. I’m talking about data centers, raw materials and metals, energy, software, semiconductor chips, robotics, and healthcare.
Could you compare the magnitude of AGI to the early days of Henry Ford’s Ford Motor Co.?
More than a century ago, Henry Ford converted 2,000 acres of family farms in Michigan into a massive factory known simply as the “The Rogue.”
In 1915, Ford started buying up small farms along the River Rouge in Dearborn, Michigan, until he had acquired a contiguous 2,000-acre parcel. Over the next five years, the Ford Motor Co. (F) converted that land into a sprawling, state-of-the art auto component factory.
The Rouge even included a massive power plant that supplied all its energy needs, as well as a 30-acre foundry that was the world’s largest at that time. With all the pieces in place, the Rouge complex started cranking out engine blocks, cylinder heads, and every other automotive part needed to mass-produce Model Ts at the nearby assembly plant in Highland Park.
In 1928, when Ford began assembling Model As at the Rouge, the plant became a fully integrated “ore-to-assembly” marvel.
Not surprisingly, Michigan became one of the fastest-growing states in the nation between 1910 and 1930. I’m expecting history to rhyme, as AGI will develop quickly and, just like Ford did for Michigan, catapult many industries to success.
AGI could even be an “ore-to-assembly” marvel in these industries itself. AGI will be able to determine what problems it needs to solve — and then solve them all on its own.
How will AGI improve healthcare?
As AI infiltrates the medical field, the U.S. healthcare industry is on track to grow faster than any other sector in the U.S. economy.
Companies are converging with AI to bring about massive amounts of innovation in the healthcare industry. In the biotech sector, for example, AI could revolutionize the economics of drug discovery.
First, it could boost the success rates of new therapies by prequalifying potential drug candidates more expertly than traditional trial-and-error processes could. Second, it could reduce the average expense and timeline of advancing these candidates through clinical trials by shortening the drug-development time frame.
Today, without AI, it can take more than a decade and over $1 billion to bring a new drug to market.
AI could impart a game-changing efficiency to the drug-development process, and thereby shower pharmaceutical companies, in particular, with a pixie dust of enormous prosperity.
Collectively, the pharmaceutical industry seems to be banking on the pixie-dust scenario. For example, all 10 of the top holdings in the iShares Biotechnology ETF (IBB) are actively integrating some facet of AI into their drug-development processes.
Many of the biggest pharmaceutical companies in the world are paying tens of billions of dollars to snap up promising biotech companies. You could call it a biotech gold rush.
The volume of merger-and-acquisition deals in the global healthcare sector surged about 22% last year, according to data provider Dealogic, even though M&A activity across all industries dropped about 23%.
I believe that the pharmaceutical industry, in aggregate, will reap handsome rewards from the expansion of AI in healthcare, especially as AGI continues to advance.
Overall, I expect AGI to impart fantastic benefits to the healthcare industry.
Can you explain “stealth” AGI?
When I say “stealth AI,” I’m usually talking non-tech companies that will adopt and apply AI with the goal of reaping huge gains in efficiency, productivity, and profits.
In many old-school industries, like shipping or travel, new AI- and AGI-enabled processes could boost efficiency and fatten profit margins. I consider industries like these to be future-proof, meaning they’re not going anywhere, despite whatever AI and AGI do. And when you put stealth AI to work inside a future-proof industry, you have the potential for both reliable and outsized gains.
What metals will be used for AGI?
Artificial intelligence has added a powerful tailwind to platinum demand… a tailwind that AGI will kick in to high gear.
At present, electronics and technology end-uses account for only 3% of total platinum demand. However, thanks to AI, the tech sector’s platinum consumption could grow by double digits for several years in a row.
According to research from Metals Focus, a boom in demand for AI applications will create an echo boom in demand for the high-specification semiconductors and sensors that enable AI technologies to operate optimally.
Much of this next-gen hardware contains platinum. As the World Platinum Investment Council explains…
The performance of the myriad of miniature transistors and capacitors embedded into an integrated circuit is enhanced by the deposition of thin platinum films onto semiconductor wafers…
These platinum films are created using a technology known as sputtering, where platinum particles are ejected and deposited onto a surface, creating a thin (only a few atomic or molecular layers thick) platinum layer.
AI-driven platinum demand could add an additional kicker to any new bull market that emerges.
The rise of AGI is also boosting demand for copper, because data centers use enormous amounts of copper for power and cooling systems. Even moderately sized data centers can require several thousand tons of the metal.
All this makes copper a very attractive business to be in – for mining companies and investors alike.
How will energy be affected by AGI?
The energy sector already plays a pivotal role in powering AI’s digital revolution.
Last year, global investment in all forms of energy hit a record-high $2.8 trillion, according to the International Energy Agency (IEA). Of that total, fossil fuel investments accounted for about $1 trillion, while renewable energy investments accounted for the remaining $1.8 trillion.
By 2030, overall electricity demand is projected to surge up to 20%. AI data centers alone are expected to consume an additional 323 terawatt hours of electricity demand annually; that’s seven times greater than New York City’s 48 terawatt hours of electricity demand.
According to a Goldman Sachs report released in April, the surge in demand from AI and data centers will be met by a mix of energy sources. While natural gas is expected to fulfill 60% of this increased demand, renewables would cover the remaining 40%.
Wells Fargo projects a seismic shift in gas consumption due to AI’s significant energy needs, which will be driven further by AGI’s growth. By 2030, daily gas demand could surge by a staggering 10 billion cubic feet (bcf). To put this in perspective, that would represent a 28% jump from the current 35 bcf/day used for U.S. electricity generation. This would boost the nation’s total gas consumption by 10%, pushing it well beyond the current 100 bcf/day mark.
Electricity-hungry AI giants like Alphabet Inc. (GOOGL), Amazon.com Inc. (AMZN), Microsoft Corp. (MSFT), and Meta Platforms Inc. (META) are currently signaling a natural gas boom. However, massive trillion-dollar-plus investments continue to flow into all forms of energy generation and storage – both fossil fuels and renewables. So, thanks to AGI’s advance, the stage is also being set for renewable energy’s resurgence. Many stocks in both sectors could soar.
As such, investing alongside AGI gives us some huge energy plays we can make. If you look into where the wealthy are positioning their chips right now, energy is where you’ll find hundreds of millions of dollars flowing.
Wall Street is not yet pricing in the real impact of AGI, so energy stocks are way underpriced across the board.
Thanks for your great questions, folks.
As AGI develops, the future that lies ahead is not simply a continuation of what has been… it is a complete departure from anything we have ever known. So, I hope you’ve found these answers to your most pressing AGI questions helpful.
Many of you also asked about which specific stocks to invest in ahead of AGI. I can’t share that here, as it wouldn’t be fair to my members, but I do show you how to get ahold of those names in my The Road to AGI presentation. In fact, I give away one my No. 1 recommendation for potentially profiting on The Road to AGI.
So, once again, you can watch a replay of The Road to AGI by clicking here.
Regards,
Eric Fry
