Imaging we are in 2030. In a world where Artificial General Intelligence (AGI) has just been realized, with OpenAI’s revolutionary o7 model outperforming human capabilities across the board, many are now grappling with the implications of living in a society dominated by Artificial Super Intelligence (ASI). As technology advances, it raises the question: what will this mean for the future of work, the economy, and personal investment?
Nick Maggiulli, Chief Operating Officer at Ritholtz Wealth Management LLC., explores this scenario and proposes three strategies to navigate an increasingly AI-driven world. He reflects on the growing consensus that AGI could soon render many human jobs obsolete, potentially leading to massive economic upheaval. With this in mind, Maggiulli suggests methods to prepare for a future in which humans must adapt to survive alongside highly advanced machines.
1. Just Own the Damn Robots
One strategy that has gained traction over the years is the idea of “just owning the damn robots.” This approach, popularized by Josh Brown in 2017, involves investing in the companies developing the technologies that might one day replace human labor. Companies like Nvidia, which have been at the forefront of AI and machine learning development, have already seen their stock prices surge as investors anticipate the future dominance of AGI and ASI.
However, Maggiulli cautions that this investment strategy might already be “priced in,” with much of the potential for growth already reflected in the market. While investing in technology companies is still likely to be beneficial, there is a significant risk if the AGI revolution doesn’t materialize as predicted. In a scenario where AGI doesn’t arrive as expected, or its implementation becomes prohibitively expensive, this approach could leave investors exposed to significant losses.
2. Hedge Your Labor, Not Your Portfolio
While owning shares in the companies creating AGI might offer a hedge against technological obsolescence, Maggiulli suggests an even more direct form of preparation: hedging your labor. This means focusing on acquiring skills that are difficult, if not impossible, for AI to replicate.
Maggiulli emphasizes the importance of emotional intelligence, taste and curation, and care in areas where humans still hold a distinct advantage over machines. For instance, while AI may be capable of creating art or providing emotional support, it lacks the deep understanding and nuance that comes from human experience. Developing skills in areas like therapy, design, and even caregiving could make individuals indispensable, even in an AGI-dominated world.
Additionally, he advises enhancing technical expertise. As AI evolves, humans will still be needed to build, maintain, and optimize the very systems that might replace many intellectual jobs. Those who understand the inner workings of AI, machine learning, and related fields will be well-positioned to thrive in this new era.
3. Stay the Course (and Paddle Faster)
For those who find the previous two strategies too speculative or high-risk, Maggiulli advocates for staying the course with a diversified investment approach. Owning broad-market index funds, such as the S&P 500, naturally increases exposure to tech companies, including those driving AI advancements, without betting too heavily on any one sector.
In the event that AGI doesn’t fully reshape the economy as expected, this strategy will help mitigate potential losses while still providing steady growth. Maggiulli suggests that those who want to accelerate their financial position should consider working harder and accumulating more assets now, providing a cushion should the future unfold as predicted.
While not advocating for a hustle culture, Maggiulli believes that increasing your financial buffer in the years leading up to AGI could prove invaluable—whether AGI happens or not.
We Have More Time Than We Think
Despite the rapid advancements in AI, Maggiulli remains optimistic that we may have more time to adapt than many fear. While AGI may be on the horizon, there are substantial barriers, including the enormous cost of developing and maintaining AGI systems. OpenAI’s GPT-4, for example, cost an estimated $100 million to build, and future models are expected to require billions. This financial challenge, coupled with the complexities of training AGI systems to perform specific tasks, may delay their widespread adoption.
Moreover, history has shown that technological advancements often create new opportunities, even as they displace existing jobs. Just as smartphones created new industries while making others obsolete, AGI is likely to open new avenues for work—many of which we can’t yet foresee.
