(MENAFN- ProactiveInvestors) Invents an AI System That Plays Video Games on Its Own
Here is the opening of this interesting article from : has created the computer equivalent of a teenager: an artificial-intelligence system that spends all of its time playing—and mastering—video games. The company introduced the new development in machine-learning technology on Wednesday describing it as "the first significant rung of the ladder" to building intelligent AI that can figure out how to do things on its own.
The research project built by a London startup called DeepMind Technologies that acquired last year exposed computers running general AI software to retro Atari games. The machines were shown 49 games on the Atari 2600 the home console beloved by all ’80s babies and were told to play them without any direction about how to do so.
When the computers passed a level or racked up a high score they were automatically rewarded with the digital equivalent of a dog treat. 's AI system surpassed the performance of expert humans in 29 games and outperformed the best-known algorithmic methods for completing games in 43 instances. Some games like Ms. Pac-Man can't be easily beaten with a mathematical formula. In others like Video Pinball the AI crushed human players with a system that was more than 20 times better than a professional human game tester.
The goal of the experiment wasn't to try to find a better way to cheat at video games. The principles of being given a task and finding the best solution can be applied to real-life scenarios in the future. The system at its base should be able to look at the world navigate around it and take actions accordingly. One day 's self-driving cars could learn how to drive based on experience rather than needing to be taught says Demis Hassabis a co-founder of DeepMind and vice president of engineering at . This research marks the "first time anyone has built a single learning system that can learn directly from experience and manage a wide range of challenging tasks" he says.
David Fuller's view
When IBM’s Deep Blue computer finally beat World Chess Champion Gary Kasparov in a six-game contest in 1997 it was being programmed between games by computer specialists some of whom were also chess champions. Today ’s AI System learns on its own and I would love to know how many games of chess it would have to play to develop the standard of a grandmaster.
A Personal View From Peter Bennett: 1) Europe 2) Risk
My thanks to this experienced investor for his Strategy Letter published by Walker Crips Stockbrokers. Here is the opening:
Having been to another of BCA Research’s (Bank Credit Analyst to you and me) very useful breakfast (aaargh the time) strategy sessions I recently changed my Strategy 2015 Part II rather sniffy view of Europe. Only I hasten to add as regards equity investment currently. The European currency remains well Euromess. I have re-entered an Italy tracker for clients and self. (For fun – not for clients too hairy have made a small ‘play’ in an Athens tracker market down over 80%.)
The European economy notably Germany and Spain was fast beginning to crawl off the floor anyway. But if maintained the currency and oil price decline should add about 1.5% to GDP growth a significant number compared with not much more than schnix previously expected. Further the fiscal policy depressant is ending. More important forecasts of corporate profits having declined remorselessly year by year since 2011 are now finally being raised. Psychologically Europe has been unpopular – a state of affairs that always attracts my interest. If lots of people agree with you in this business it is likely that you are wrong. Better to be the investment outcast at the 19th Hole. Being an only child I have no problem with this sort of thing. Lastly on valuation the numbers are reasonable if not overwhelming. Certainly viz-a-viz the Shiller PER - about 16 (Italy 8.5 Greece 3.4) versus US 26.
Caveat. Given the current absurd financial environment risks are so high that an “all bets are off” situation could (and likely will) occur at some stage. Trading skills are at a very high premium currently. Buy and hold medium term. Generally speaking - dangerous. Though there are exceptions. Interestingly fund managers have been selling out of UK equities bar nine months for over a decade. This is surely bullish (source: FT 24/02).
David Fuller's view
In recent months the EU has been a catch-up play not least thanks to Mario Draghi. Most of the EU stock markets are currently overextended on a short-term basis and may now be commencing a reaction and consolidation phase. Thereafter I would not be surprised to see further recovery moves fuelled in part by QE which commences this month and runs until at least end-September 2016.
This item continues in the Subscriber’s Area where Peter Bennett's Letter is also posted.
Deepak Lalwani: India Report
My thanks to the author for his informative report on India’s Annual Budget (Y/E 31.3.2016). Here is his Budget Analysis:
VERY POSITIVE BALANCED PRAGMATIC BUDGET AIMED AT GROWTH JOBS INFRASTRUCTURE AND ADDRESSING NEEDS FROM ACROSS SOCIETY. DESPITE NO "BIG BANG" REFORMS INDIA INC IS LARGELY HAPPY AS THIS BUDGET IS SEEN AS THE START OF AN UPWARD ECONOMIC JOURNEY
1. Positives include: a) A social security net has been started; b) Intent to reduce the fiscal deficit with an eye on fiscal prudence while spurring economic growth; c) GST expected to be introduced on 1 April 2016; d) Infrastructure spending to continue to support economic growth; e) Forecast tax collection targets are reasonable and should remove the need on tax officials to be over-zealous and reduce pressure on them to harass taxpayers; f) GAAR postponed.
2. Negatives include: a) Rather rosy assumptions made of growth - calculations could go awry especially if oil prices spike sharply higher; b) No details are given on what will drive growth to such levels; c) Very ambitious target for privatisations.
Overall a very good budget. The key as always in India lies in implementation and speed of delivery.
David Fuller's view
The India Report also contains a 10-point assessment of the Budget which is sensibly pro-growth as one would expect from Narendra Modi and Finance Minister Arun Jaitley.
This item continues in the Subscribers’ Area where the India Report is also posted.
My personal portfolio
Some trading profits taken
David Fuller's view
Details and charts are in the Subscribers’ Area.
The 15 Happiest Economies in the World
Here is the opening of this informative summary from Bloomberg: Feeling bummed about your economy It's time to pack your bags for Switzerland.
That's one way to read the fate of 51 economies (including the euro area) this year based on Bloomberg calculations of what's known as the "misery index." Inflation and unemployment two factors that make consumers unhappy are remarkably low in the 15 countries shown below according to economists surveyed by Bloomberg News.
While the Swiss National Bank attracted some tumultuous headlines earlier this year the haven of ski slopes and chocolates still outshines its peers in the survey as a consumer-friendly place to live. For the country's working-age consumers — only 3.3 percent of whom are likely to be unemployed this year — an estimated 0.9 percent drop in prices in 2015 will help cushion the blow from a surging currency. That's enough for Switzerland to claim one of the least-sad spots in the misery index. (The lower the score the better.)
David Fuller's view
I hope you are happy where you live. The Fuller family remains very content in London but I am concerned about the General Election in May.
Berkshire Hathaway Annual Shareholder Letter
Thanks to a subscriber for Warren Buffet’s annual letter to shareholders. Here is a section:
The reason for our conservatism which may impress some people as extreme is that it is entirely predictable that people will occasionally panic but not at all predictable when this will happen. Though practically all days are relatively uneventful tomorrow is always uncertain. (I felt no special apprehension on December 6 1941 or September 10 2001.) And if you can’t predict what tomorrow will bring you must be prepared for whatever it does.
A CEO who is 64 and plans to retire at 65 may have his own special calculus in evaluating risks that have only a tiny chance of happening in a given year. He may in fact be “right” 99% of the time. Those odds however hold no appeal for us. We will never play financial Russian roulette with the funds you’ve entrusted to us even if the metaphorical gun has 100 chambers and only one bullet. In our view it is madness to risk losing what you need in pursuing what you simply desire.
Despite our conservatism I think we will be able every year to build the underlying per-share earning power of Berkshire. That does not mean operating earnings will increase each year – far from it. The U.S. economy will ebb and flow – though mostly flow – and when it weakens so will our current earnings. But we will continue to achieve organic gains make bolt-on acquisitions and enter new fields. I believe therefore that Berkshire will annually add to its underying earning power.
In some years the gains will be substantial and at other times they will be minor. Markets competition and chance will determine when opportunities come our way. Through it all Berkshire will keep moving forward powered by the array of solid businesses we now possess and the new companies we will purchase. In most years moreover our country’s economy will provide a strong tailwind for business. We are blessed to have the United States as our home field.
Eoin Treacy's view
A link to the full report is posted in the Subscriber's Area.
Governance really is Everything. It is interesting that when one listens to Warren Buffett or Charlie Munger speak about the businesses they own they first talk about the quality of management they employ to run their operations. The role of management in delivering results is too often underestimated as a major contributor to returns because it is difficult to quantify. On the other hand we often see that investors are willing to give the benefit of the doubt to a new manager brought in to effect a turn around after a difficult period.
Nasdaq 5000: Bubble or not
Thanks to a subscriber for this discussion from CNBC highlighting the fact that big round numbers are where investors tend to take stock of where a market is likely to go next. Here is a section quoting portions of the transcript:
The Nasdaq wouldn't be here if not for quantitative easing. It wouldn't be here without zero percent interest rates. It wouldn't be here without unprecedented stock buybacks fueled by cheap money" Peter Schiff CEO of Euro Pacific Capital told CNBC. "You have all these artificial props which have lifted up the market and there's no way to sustain the market without those props."
The Nasdaq index last touched 5000 in March of 2000 marking the peak of the dotcom bubble's euphoria - or what some called hysteria - before the index crashed around 80 percent to a nadir of 1108.49 in October of 2002. It's been a long climb back to its 5008.096 close on Monday.
What bubble
But not everyone is convinced dotcom euphoria is making a revival. "I'm not a perma-bull. I'm very interested in shorting overhyped overvalued stocks" Wayne Kaufman chief market analyst at Phoenix Financial told CNBC citing bets against GoPro and Tesla. "I don't believe we are in a bubble and I think the fundamentals bear that out" he said citing then-and-now data.
Eoin Treacy's view
The Nasdaq Composite tested the psychological 5000 on Friday and is somewhat overextended relative to the 200-day MA. In addition to being a big round number this level is also in close proximity to the Index’s all-time high and is a logical place investors would pause and take stock not least because the stock market has been rallying since 2009.
Creative AI: Software writing software and the broader challenges of computational creativity
I thought this article by Richard Moss for Gizmag offered an excellent summary both of where creative programming is and the challenges of developing it further. Here is a section:
"Every time you sit down and actually work with artificial intelligence you become aware of the limitations of what we're able to do and what we know how to do" says Georgia Tech associate professor Mark Riedl who spoke to us about his story and game generation projects. "Oftentimes scientists like myself like to extol the virtues of what we're working on without talking about the limitations and the boundaries that we have."
Those limitations are stark. Artificial intelligence agents are currently highly focused. They mostly exist to accomplish one task – telling stories for instance or perhaps serving personalized ads to users – and have no idea how to do anything else. Colton notes that it's "painfully difficult" to get it to accomplish even the most unintelligent of intelligent tasks. And he thinks the idea of a singularity – some sudden moment where AI goes from dumb to hyper-intelligent – is misguided.
"It's not like the physical sciences" he explains. "There are no breakthroughs in AI. Certainly not in the 15 years that I've been going to conferences. There are things which come to the fore and become very successful and AI is full of success but there's no moment where we split the atom put a man on the moon cure a disease. That just doesn't happen. Things are incrementally slowly carefully done."
Game-developing AI ANGELINA creator Michael Cook puts a different spin on it. "Driving a car from A to B is not the hard part" he notes. "The hard part is having a chat with the passenger on the way there." The first of those we can now do; the second not so much.
Eoin Treacy's view
Quantitative Easing Is not Working BlackRock Peter Fisher Says
This article by Alexandra Scaggs for Bloomberg may be of interest to subscribers. Here is a section: BlackRock’s Peter Fisher says that central- bank bond-buying programs aren’t working.
Quantitative easing is supposed to push investors into riskier assets Fisher senior director of the BlackRock Investment Institute and a former undersecretary of the U.S. Treasury and executive vice president of the Federal Reserve Bank of New York said in a Bloomberg Television interview.
“It isn’t working” Fisher said. “Mostly it drives up the price of the low-risk assets as we’ve seen in Europe today.”
The European Central Bank which meets Thursday has said it will begin monthly purchases of 60 billion euros ($67 billion) of bonds this month. Government bonds in many European countries have rallied before the purchases with about $1.9 trillion of sovereign debt trading with negative yields.
The Federal Reserve’s bond-buying program which wound down last year wasn’t much more successful he said.
“It didn’t really work here it worked at the margin as a little chase for yield” he said. “People want to hoard the best assets.”
The risk of deflation in Europe may mean that a rate increase from the Fed won’t dent the prices of longer-term Treasuries Fisher said.
Eoin Treacy's view
Quantitative easing has worked if one measures the response of risk assets such as equities to massive infusions of liquidity. A great deal of anxiety is currently being expressed at the elevation of stock markets but there is no sign that the flow of liquidity is being inhibited by central bank action.
Speaking Engagements 2015
Eoin Treacy's view
I have accepted an invitation to speak at the annual MTA Symposium in New York on March 26th and 27th. The topic of my talk will be Quality Trends: Bet on quality and monitor consistency
The Chart Seminar 2015
Eoin Treacy's view
Following a productive collaboration last year we have agreed to co-host another Chart Seminar with the CFA Institute in Singapore. This will be on April 16th and 17th at the M Hotel on 81 Anson Road.
To book your place or express interest please contact Sarah Barnes at sarah@fullertreacymoney.com
The full rate for The Chart Seminar is £950 + VAT. (Please note US Australian and Asian delegates as non EU residents are not liable for VAT). The early booking rate of £875 for non-subscribers expires two months ahead of the event start date. Subscribers are offered a discounted rate of £850. Anyone booking more than one place can also avail of the £850 rate for the second and subsequent delegates.
Private Seminars and Partnering Opportunities
We are also available to conduct private seminars and occasionally agree to speaking engagements at investment conferences and professional societies.
Eoin Treacy's view
FullerTreacyMoney set up a feed in December but I didn’t start updating it until yesterday. In the era of social media many people tend to look more at their accounts than free daily emails so we will post content both on our website and via .
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