Transcript generated automatically by AI and may contain errors.
Chapter 1: What is the main topic discussed in this episode?
We are back in your life.
Chapter 2: Can ChatGPT really replace a mortgage broker?
And today, beep, boop, beep, boop, ChatGPT is not your mortgage broker. More and more frequently, we are seeing Chaz come up when it comes to advice conversations. Mike, you had a bit of a doozy the other day where you were like, all right, Mr. or Mrs. Client, this is what we should do. And they were like, nah, computer says otherwise. Yeah. Can we break that down?
I don't know what the beep-boop, beep-boop thing is. I'm a robot. Beep-boop, beep-boop. I just wanted you to do it again.
Chapter 3: What real-life example shows AI's limitations in mortgage advice?
And also, Chaz is what we call ChatGBT in here. So if we keep calling it Chaz, you probably need to let people know what we're talking about. Does everyone call it Chaz? I think so. It's just us. I think it's just us. Everyone does? I don't know. I'm not in the internet forums about ChatGBT. So I was speaking to a customer the other day. giving some advice on their fixed rate.
You know, fixed rate's going up. Need to refix. What should I do, Mike? And I was like, yeah, look, I think a two-year fix sounds about right for you, you know, based on their situation. And they went, yeah, Mike, that's great. However, ChatGBT told me to fix for six months. And I was like, I think that's the worst piece of advice I've ever seen. It is interesting, eh?
Like, if you see, like, a huge spike in six-month fixes or something. So I assume once ChatGBT, unless they've gone, here's all my personal information or something. No, I don't think they've done that. Oh, they might have. I don't know. They were, like, quite an intelligent person. Yeah, so they may have fed it all their data, but...
Chapter 4: How does personalized advice differ from AI-generated information?
yeah i think um generally you know the question about whether humans can be trusted and people probably more naturally want to trust like um the ai tools do you do you feel like that's a no i don't naturally want to trust them no i know you but you you know get a bit of your own drum i'm talking about like society as a whole generally speaking do you think people are more likely to trust the tools than people
Nah, that's such a broad question. That's been my experience. But I think for specific things, they probably trust it more than a human. But on average, I think people trust humans more than they trust AI. Okay. Why is it a bad idea that they fix for six months? Yeah, look, for this specific client, fixing for six months, definitely, hey, you know what? Chat might be right. You know what I mean?
But my advice was to fix for two years. Why was I picking two years over six months for this customer? Look, we know interest rates are on the way up. There are two OCR hikes fully priced in by the end of the year. They could fix for six months.
My worry would be at the end of that six-month period, they would be on much higher interest rates than they are now, even though the six-month fix is lower than the two-year fix. My advice was to take the two-year fix, buy yourself that insurance, and ride out the kind of next 24 months of rate hikes, right?
Because reasonably speaking, we know that interest rate cycles or the hiking cycles last somewhere like 12, 18 months. The last one was like a lot longer than they'd usually last, so on average, about 12, 18 months. So where did you leave it with the client? We went for two years. I did say, I was like, feel free to split it 50-50. We'll see who wins. Like you fix half on six, half for two.
If I win, you owe me a bottle of wine. If you win, I owe you a bottle of wine and chat you a bottle of wine. But they didn't. They fixed it two years. Nice. Oh, that's good. So you won. Well, I don't know. That's the thing. Time will tell. I might be looking back on this in six months being like, you're an idiot. Oh, my God, you owe ChatGPT a bottle of wine.
You're just not on the podcast in six months. It's just the laptop. Yeah, but it is an interesting thing, right? Because as people start to use ChatGPT over Google to ask questions and get proper formulated answers, I think we're going to be seeing this more and more. Yeah, well, speaking of seeing it, my superstar financial advisor, Jess,
recently had a client hand her a full financial plan that was written by chat GPT and asked for her thoughts on it. Um, instead of reading the plan, just was like, nah, nah, nah, nah, I'm not doing that thing. Um, I'm just going to be doing like my own independent, um, analysis before. And then after we go through the process, we can, um, compare the two. Did you compare them? Yeah.
So once you reviewed the AI generated plan afterwards, there were multiple recommendations and assumptions that were unsuitable or like missing important context. So, um, I think the issue is that AI, you know, it can do math. It can do calculations. Probably better than me. Mate, it can definitely spell an email better than you.
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Chapter 5: Why is fixing a mortgage for six months a bad idea?
Probably that's the bit. If you want to get information to make your own decision, that's cool. But the tool shouldn't be making the decision for you, like, because it might make the wrong decision. Yeah. I mean, and like advisors still get it wrong. We get it wrong all the time, right? Especially you. No, I never get it wrong. But, you know, it's just that like I just don't think it's there yet.
And so we were having a discussion the other day with a friend and a client of ours who works in the film industry. And we're at lunch and we're talking about AI and how it operates in the film industry.
And someone asked him the question was like, surely we're like five years away from AI just creating entire like cinematic quality movies and like, you know, just like running the whole thing into end. And he was like, absolutely not. You are so far away from that. It's probably like 10, 20 years away before it even gets close to being able to do that.
Chapter 6: What factors should influence mortgage fixing decisions?
And we were like, nah, surely not. That doesn't make any sense. And he raised a really good point. He's like, it can't even properly write you an email without you editing it. And I was like, huh? And he was like, you have no idea how complex that stuff is and you have no idea how far away it is from being able to do that. And I think that's the thing.
People overestimate how useful these tools are or their ability right now. Right. And I think that's where people go wrong with this stuff. Yeah, there's a saying, if you overestimate what will happen in the next 12 months, underestimate what will happen in the next decade.
The thing I struggle with with the whole, like, you know, where it will be in five years versus three years versus 12 months is the exponential nature of the curve. and where we are on the curve, which nobody will really know until hindsight, that's the bit where people make calls on going, like, if it got 100 times better or 1,000 times better and then it got two times better, I don't know, man.
I just sit here, give opinions, tell my friend he looks good. Yeah. And, like, I'm not saying we're anti-AI. You know, like, that's definitely not the case. Like, I think there's a role for it in society and work. You're an artsy guy, though, and generally artsy people. But I think...
when if you're trying to predict like that far out into the future and especially if you're trying to use it now you go it really goes one or two ways right it either becomes so good but so expensive that the businesses can't get their kind of like efficiencies that they want out of it and that's if there's like one dominant player right that has the resource to reinvest and like hits profitability or you kind of have the uber model
You might have Uber, but in every market around the world, there's a couple more as well. They never quite get there. And yeah, you get to enjoy cheaper rides, but the company never gets profitable, never really hits a scale point where it's amazing at everything. So I think the market will bifurcate in one of those two ways.
Yeah, the concept of like these big businesses, like a lot of them are over their AI budgets for the year and usage and like they gamified the whole thing about like how many tokens can you spend? And now everybody's like, huh, maybe that's a bad idea that we just like spend money for the sake of spending money.
So the point particularly around the cost versus the return within these businesses is going to be quite interesting. Obviously got Anthropic and OpenAI talking about listing as well. It'll be very interesting to see what multiples they come in at and whether they can maintain their share price compared to the hype. Yeah, I completely agree.
You know my thoughts on recent IPOs and valuations of companies, so we don't have to go down that path. Cool. All right, we'll wrap it up there. Let us know, would you get financial advice from Chaz or would you prefer to use Gemini instead? Or would you use a mortgage broker? Like, review, subscribe, and we'll catch you next time. Cheers.
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