A New Trend in AI is Emerging: Efficiency

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Motley Fool Hidden Gems Investing 22 min 4 speakers 8 chapters transcribed 5 months ago
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What recent legal challenges are Meta and Alphabet facing?

Tyler Crowe 0:05
Efficiency in AI could be just what the doctor ordered. This is Motley Fool Money.
Tyler Crowe 0:21
Welcome to Motley Fool Money. I'm Tyler Crowe, and today I'm joined by longtime Fool contributors, Matt Frankel and John Quast. We've got a really interesting show today. We're going to talk about some stepwise gains in the world of AI, but not in the way we've been talking about it for quite some time. And we're going to hit a mailbag question because we are already getting them even after announcing that we're going to start taking them at our email address. We'll get into that in a second. But first, probably the biggest Newsday story outside of, you know, global war conflicts and things like that was there was some pretty big legislative decisions that happened for big tech. And it wasn't exactly the way they wanted it to go.

How are social media platforms being compared to the tobacco industry?

Tyler Crowe 0:59
In a couple of pivotal cases, one of them, Meta Platforms and Alphabet, were found liable for a woman's mental health struggles related to social media addiction, and they had to pay punitive damages. Also, Meta lost a similar case in New Mexico related to misleading statements about safety on their sites. Now, admittedly, this one's kind of a hard one to discuss on an investing podcast. I think there's a lot of emotions wrapped up in our use of social media and how that affects things. But there is going to be some investing takeaways here. But I wanted to get your guys' thoughts here. Are either of you shareholders in Meta? And as you kind of like viewed these verdicts and things like that, has it really changed your view of the company?
Jon Quast 1:39
So to your first question, Tyler, no, I'm not a Meta shareholder personally. That's not a indictment on the company.

What advancements in AI efficiency are being discussed?

Jon Quast 1:45
I've gone on record that Meta is one of my more favorite companies in the Magnificent Seven. But to your second question, does this change my view of the company? The answer is not yet, but it could potentially. Specifically with the issue of mental health, I think that all the statistics point to an indisputable conclusion. We do have a mental health epidemic, unlike anything we've ever seen. And I believe two things can be true here. First, social media apps are engineered to maximize user engagement. I don't think that that's a controversial take. It is how they generate revenue. Of course, they want their users on there as much as possible so they can generate ad revenue.

How is ARM changing its business model for AI?

Jon Quast 2:23
The second thing, I mean, I wouldn't blame social media apps entirely for mental health issues, but it does seem to be a contributing factor when it comes to this topic. I think if you're new to this discussion, the book I'd recommend is the anxious generation by Jonathan Haidt. It does a great job of laying out the rise of anxiety in Western culture, also potential remedies, some suggestions by the author. I know this might sound off topic for an investing podcast, but I do believe it is pertinent. The jury verdict here is far from the final conclusion when it comes to Meta. Meta is going to appeal this case, it's going to go higher. But if social media is ultimately deemed harmful...
Matt Frankel 3:02
like other harmful things we could see some substantial reforms from legislators that could have an impact on these cash cows so i'm not saying that it's the final word but it is something material to keep an eye on i'm not a meta shareholder but we do own shares of alphabet you know which is youtube's parent company in my household my wife does in her account it doesn't really change my opinion on either company i've already had my kind of opinion formed i'm a parent of young children I think all three of us here are parents of young children, so I'm sure we have our own opinions of social media when it comes to how it impacts the mental health of our kids. I feel like people are becoming a lot more cognizant of the dangers of social media right now than they were a few years ago, which is what the basis of this case was.

What is Google's new memory compression method for AI models?

Matt Frankel 3:46
It was people who use social media online. and were addicted to it a few years ago. But my kids, I can tell you, won't be on social media until they're at least in their late teens.

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