Three companies making 💰 from military AI

14th March 2024

Welcome to AI Collision 💥,

In today’s collision between AI and our world,

• AI weapons in a box

• EU goes full regulator

• Chicken from chicken

If that’s enough to get the missiles firing, read on…

AI Collision 💥 military 🤝 AI stocks = 💰

Before I get into today’s AI collision, fair warning that the “AI Gone Wild” section today is grim.

And it’s because I believe that the wealth window for AI may be closing. Not super quickly, but still closing. That’s due to regulation, government intervention and their obsession with “regulate first, ask questions later”.

That said, while the window to mint wealth from AI may be closing, I still believe you do have a chance to make your claim for a stake in this huge wealth opportunity now.

And it’s going to come from companies and industries that, as we’ve written about time and time again, are critical pieces of a large jigsaw puzzle.

That can come in the form of everything from semiconductor companies, to sensing technology, wireless technology, processing technology, communications, infrastructure, energy and memory systems.

But you need to follow the money. You need to ensure that when looking for ways into the AI investment story, you’re finding out where money is being spent.

And there’s not many bigger more well-funded areas for AI to soak up the capital than military purposes.

For example, the Pentagon is currently looking to have as many as 1,000 AI-powered drones developed and built with $6 billion up for grabs to the winning company.

In the mix are big players like Boeing, Lockheed Martin, Northrop Grumman, General Atomics and Anduril Industries.

Anduril is the interesting one in the mix there. It’s the brainchild of Palmer Luckey, the creator/founder of Oculus Rift/VR who sold Oculus to Facebook for $2 billion almost ten years ago to the day.

I covered Anduril briefly in AI Collision on 5 December last year as it was building weaponised AI drones. Now it looks like it is throwing its hat in the ring with the real big boys of weapons and military systems.

These all make for interesting companies to consider when looking at AI opportunities. Of course, when you’re as big and diversified as companies like Northrop, Lockheed and… Boeing (eek!) there’s other consideration to make.

I won’t say much about Boeing, but this isn’t going down well in the news cycle😲

Of all those, Anduril does look to be the most interesting, most aligned with AI integration into its weapons, and of course the most uninvestable right now of all of those!

In short, maybe Anduril gets this contract, maybe it doesn’t. But expect to see its name a lot more in relation to AI weapons. And if the company ever opens up for investment, it’s definitely going to be one we’re going to take the fine toothcomb to.

AI Gone Wild 🤪

I had to start with this GIF.

This is the most accurate reflection of emotion right now. As I write today’s AI Gone Wild section, literally two hours ago the European Union passed “landmark” AI laws that are designed to put:

• Safeguards on general purpose artificial intelligence

• Limits on the use of biometric identification systems by law enforcement

• Bans on social scoring and AI used to manipulate or exploit user vulnerabilities

• Right of consumers to launch complaints and receive meaningful explanations

Once again, 618 political elite (MEPs) have made sweeping decisions on behalf of approximately 447 million people.

As the EU news release states, this law, “… aims to protect fundamental rights, democracy, the rule of law and environmental sustainability from high-risk AI.”

See that?

See them slip in “environmental sustainability” in there? And the vaguest “high-risk” description of AI?

Smooth isn’t it.

The positioning of the “union” is such that they are saying this will help Europe become world leaders in AI development. These laws will help boost innovation.

These laws are for your own protection.

I guess we shouldn’t really expect much less. After all, if the regulators aren’t regulating, then what’s the point of them…?

Here’s how this goes.

New laws designed to protect you from AI really means red tape and bureaucratic obstacles, with costs, designed to excrete fees and taxes from companies looking to develop the most exciting technology since the proliferation of the internet and the release of the world’s greatest financial asset, bitcoin.

They have no intention of protecting anyone except their own interests in maintaining their standing in the European Parliament.

It should also come as no surprise that this decision has also comes hot on the heels of a new report by Gladstone AI, commissioned by the US State Department 13 months ago, into the “assessment of proliferation and security risk from weaponized and misaligned AI.”

This report also formulates a series of “action plans” to rein in the existential threat AI poses to humanity.

Again, unsurprisingly, it says, “Right now there is no clear model for long-term regulation that will protect us from catastrophic risks while promoting responsible development and adoption of advanced AI.”

Regulation. Regulation. Regulation.

In other words, command, control, conquer.

And don’t be fooled into thinking the US State Department has any interest either aside from the adoption and control of AI systems in the world.

It is clear that when a technology rises, that poses a direct existential threat to the kakistocracy (not really to you or I) that the immediate reaction is fear, fear and a sprinkling of fear to condition the public response to these technologies.

The end result becomes an industry that is maligned, railroaded, constrained and concentrated. The concentration flows towards those organisations and participants who submit and agree to the controls imposed. Because they get a seat at the big boys’ table.

Meanwhile, real progress and innovation is stifled. And who’s left holding the can and paying for it? You are, the taxpayer.

There’s not much you can do about all this I’m afraid. These patterns are repeated with eery significant new technology revolution.

The best pathway to freedom from government control is to exercise financial freedom. To build significant wealth that you are able to tap out of some of these systems and control the direction of your own pathway.

What makes that possible is that with new technologies like AI (and cryptocurrency for that matter) you do have a window of wealth to front run the government and the regulators. They are slow to react, and slow to move – that’s the one thing that works in our favour. So investing in these AI opportunities, and the stocks that are minting real wealth right now, is the best chance you’ve got to get ahead before the government slaps a gigantic lid on it all.

You’ve still got time. Not much I’d say, but still a good year or two before this opportunity, like many others, starts to dilute itself down, until the next major breakthrough comes along. Hence I suggest you get active, get investing and keep working on that plan for freedom.

Boomers & Busters 💰

AI and AI-related stocks moving and shaking up the markets this week. (All performance data below over the rolling week).

Photo by Gilly on Unsplash

Boom 📈

• Appen (ASX:APX) up 53%

• Darktrace (LSE:DARK) up 32%

• Lantern Pharma (NASDAQ:LTRN) up 26%

Bust 📉

• BigBear.ai (NASDAQ:BBAI) down 30%

• C3.ai (NYSE:AI) down 6%

• AMD (NASDAQ:AMD) down 7%

From the hive mind 🧠

• Remember that time we said that Ai and elections this year would be a hot topic? Yeah, that’s not going away in a hurry. Even Google is now putting the shackles on its AI to stop it influencing people's vote.

• Remember that time when it was said AI would be an existential threat to humanity, and it wasn’t? Yeah well that mainstream news angle isn’t going away in a hurry either. Here’s another fear injection about AI just incase things have got too positive recently.

• Remember that time when humans used to fight wars? Yeah well that’s not happening again any time soon. Specially when the Pentagon is fishing for the development of cheap AI drones to go and do their bidding on the battlefield.

Artificial Polltelligence 🗳️

Admittedly I’m quite against the overreach of government, regulators and concentrated power that wants to prod and pull you in every which way.

I’m much for the idea of just leave us alone and we’ll take care of ourselves, so butt out of our lives. But I also appreciate that certain parts of our world function better when there are some boundaries and bumper-rails to proved some guidance.

But I’m interested where you might sit on this question…

So today’s poll…

Weirdest AI image of the day

Animals made out of their own meat – r/weirddalle

ChatGPT quote of the day

"Innovation in technology and AI is like planting trees under whose shade you do not expect to sit. It's about creating a legacy that outlives your own immediate needs and benefits generations yet to come." – Unknown internet user

Thanks for reading, see you next week (and don’t forget to leave your comments below)

Sam Volkering

Editor-in-Chief

AI Collision

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