Insider Newsletter: Issue #305

AI is running airlines into the ground, Nvidia’s market cap is absurd, and China may be pulling off the ultimate financial heist—what happens when the whole system finally breaks?

Greetings, friends!

Isla Margarita from yours truly. More about this and why later.

Andrew of Mavericks fame was in the Mendoza valley, Argentina.

I Did My Part to Save the Planet (And AI Will Save Us All)

Travel, they said, would be exciting. Travel, they said, would be fun.

Well, I can tell you unequivocally that if you ever get severe gastro issues, you DO NOT want to get them on a 14-hour flight.

Suffice to say that travelling is not exciting or fun in such instances.

The irony is that I would have been very far from a plane if my flight hadn’t been cancelled, causing me to have to stay overnight to catch another the next day.

Here’s what was hilarious. I had an American Airlines flight, which sat on the runway for a couple hours before they decided that we weren’t flying after all.

I dunno why. I’d fallen asleep as I was clocking in around 20 hours of being awake so…

Anyway, after I was rudely awoken by the air hostess, I thought, “Damn, that was a short flight. We must be landing soon,” only to realise that I’d crashed out while apparently we sat on the runway because something wasn’t right.

Maybe the new diversity hires weren’t done with inspecting the sandwiches for their carbon emissions.

You know, LGBT (lesbian, gay, bacon, and tomato). Who knows?

In any event, we were not going anywhere and were told to return the next morning (it was 2am so morning was fast coming).

And here’s the best part. They told us that we would get updates on our phones via the American Airlines app (which I don’t have), but please to IGNORE them. Huh, what?

It turns out that the messaging system is run by AI, which must stand for “absolute idiot,” and to ignore the messages because the “AI” will tell us that the new flight time is 2pm, which will be wrong…

…so please come back in the morning and check the boards at the airport. We don’t know when the flight will be but we do know that the AI will tell you something, and that something is going to be wrong.

Hahaha! Remember the good ol’ days a few years ago when we would just call the help desk and talk to “Cindy” in Mumbai?

Except you knew from the accent that it definitely wasn’t “Cindy.” I promise never to complain again about the folks in sweat shops in Manila answering my problems. Bring them back, pleeez! Now we’re forced to deal with a bot.

Anyway, I did as was told, grabbed a few hours sleep at the closest hotel I could find, and was back at 7am, only to find that in the morning the boards at the airport reported my flight status as “flight departed” and showed the previous day.

I asked the American Airlines desk, and they told me to check my phone. Ha, back to the AI bot.

Except that the one elbow of the airline hasn’t spoken with the ass and so we find ourselves in this awkward situation where the customers are informing the elbow that it doesn’t know where it’s arse is. “Oh, ok Sir, well…

…I recommend you check the boards.” Great, back to the boards, telling me I’ve missed my flight.

The blank stares reminded me of my dog.

I can look him in the eye and tell him he’s a dumb stupid mutt, but if I use a kind voice, he’s ecstatic and will wag his tail happily.

I got the same stupid smile without any acknowledgement whatsoever of the actual problem at hand… and certainly not the foggiest idea how it may be fixed.

What I realised is that what we have is entire companies so reliant on technology that nobody knows anything anymore.

And I tried the American Airlines desk at check in, I also tried the “service counter” in the business lounge (and twice, because a new chap arrived, and I thought that maybe just maybe he wasn’t clueless like everyone else — I was wrong).

And then it all made sense.

You see, the entire airline from top to toe has bet on their technology to solve these problems. Namely, some new “AI.” Kinda like the market, really.

The poster child of AI is, of course, NVIDIA. Here are the USD market caps of the Nikkei Index, Nvidia, and MSCI India.

Nvidia’s total value ($3.65 trillion) is within a trillion dollars of the total value of Japan’s Nikkei 225 Index, which itself is valued at $4.65 trillion.

Japan, I will remind you, is the second-largest stock market in the MSCI All Country World Index (ACWI).

It’s like a full circle. If we go back and read about the 80’s, we find that Tokyo’s imperial palace was worth more than the State of California and golf club memberships cost a whopping $3 million.

In the 80’s! According to the government (who are understating this), a dollar in the 80’s is the equivalent of $4 today.

So golf memberships were the equivalent of $12 million.

Anyway, American Airlines is all in on some useless AI that doesn’t work, and as far as I can tell, much of the market is all in on AI in the form of Nvidia.

In any event, that was the precursor to my doing my bit for climate change.

Confused?

You see, when I woke early the next morning after a few hours of sleep, and I finally did find my flight (the boards miraculously finally changed to reveal the new departure time and gate), and after settling into my seat for the 14 hour flight, just 2 hours into the flight severe gastro hit like Desert Storm.

It was carnage.

I locked myself in the toilet for what was probably about 4 hours.

It is a formidable weight loss technique — once you start, you have no control. I mean zero. You think you may just be done with your workout, thoroughly exhausted, but…

Still, I like to look on the bright side of things. The eco vegans will be happy as I managed to purge all of the Argentinean beef from my system such that when I landed my carbon emissions were as pure as driven snow.

I was exhausted, and I promise you there was nothing left to give, which ironically is where this Nvidia craze will end at some point.

The number of buyers compared to sellers will also be exhausted, with nothing more to give, and there will simply no longer be any more buyers.

Everyone and their mother will be “in.”

And then we are likely to see a purge, a cleansing, if you will. Until then, we most certainly will NOT be investing into this mania, rather sticking to our bread and butter.

Markets are cyclical, narratives shift, and fortunes are made by those who see the turn before the herd.

The AI frenzy, China’s strategic financial play, and the shifting energy landscape—what does it all mean for your investments?