Elon Musk says one billion robots could reshape AI
Musk says robots could be five times more productive than a human and could start manufacturing other robots, creating a recursive manufacturing effect.
One Billion Robots Please click here for an enlarged chart of Tesla Inc (NASDAQ: TSLA ).
Note the following: This article is about the big picture, not an individual stock.
The chart of TSLA stock is being used to illustrate the point.
Tesla is one of the major ways for U.S. based investors to participate in the humanoid robot revolution.
The chart shows TSLA stock is in a downtrend.
The chart shows TSLA rallied 5.5% on Monday on 46% above average volume after gaining about 18% in August.
The chart shows yesterday TSLA gave back some of the gains.
The recent gains in TSLA have come ahead of Tesla’s robotaxi event tomorrow.
In our analysis, more important than the Cybercab will be any unexpected FSD advance and credible numbers for scaling.
Further in our analysis, an unexpected technological advance or credible scaling numbers can result in a strong advance in TSLA stock toward the trendline shown on the chart.
On the other hand, if there is no surprise, TSLA stock may have a sell the news reaction to the event.
The reason we are highlighting TSLA stock is not the Cybercab, but Elon Musk’s prediction of one billion robots within 10 years.
Here are the key points from Musk’s prediction: Robots will be five times more productive than a human.
Robots will start manufacturing other robots generating a recursive manufacturing effect.
Initial growth will be slow but after the feedback loop develops, growth will be exponential.
Here are the two key questions for prudent investors: How realistic is Musk’s prediction? What are the risks to the stock market on a transition from conventional AI to robots? In our analysis, there are significant risks in the transition to robots for investors, but even if 20% of Musk’s projections come true, there will be significant opportunity that can drive the stock market much higher.
There is a reasonable probability of a 30% — 50% stock market drop at some point during the transition and ultimately, S&P 500 reaching 16,000.
Prudent investors should be aware that the U.S. is considering selective tariffs on semiconductors.
ADP is the largest private payroll processor in the country.
ADP uses its data to provide a glimpse of the official jobs report that will be released on Friday at 8:30am ET.
The just released ADP data shows employment is stable.
ADP Employment Change came at 38K vs.
47K consensus.
ISM Manufacturing Index released yesterday came at 54.6% vs.
55.3% consensus.
A number above 50 is considered economic expansion.
The Fed’s Beige Book was released at 2pm ET.
Expect blind money to continue flowing into the stock market this afternoon.
Blind money is the money that flows into the stock market on the first two days of the month without any analysis irrespective of market conditions.
Magnificent Seven Money Flows Most portfolios are now heavily concentrated in the Mag 7 stocks.
For this reason, it is important to pay attention to early money flows in the Mag 7 stocks on a daily basis.
In the early trade, money flows are positive in Apple Inc (NASDAQ: AAPL ), NVIDIA Corp (NASDAQ: NVDA ), and Tesla Inc (NASDAQ: TSLA ).
In the early trade, money flows are neutral in Alphabet Inc Class C (NASDAQ: GOOG ).
In the early trade, money flows are negative in Amazon.com, Inc. (NASDAQ: AMZN ), Microsoft Corp (NASDAQ: MSFT ), and Meta Platforms Inc (NASDAQ: META ).
In the early trade, money flows are neutral in SPDR S&P 500 ETF Trust (NYSE: SPY ) and Invesco QQQ Trust Series 1 (NASDAQ: QQQ ).
Momo Crowd And Smart Money In Stocks Investors can gain an edge by knowing money flows in SPY and QQQ.