Technology Winter? Dream On!!

I will be writing a 2023 ‘trends to watch’ article but I have to confess to being blind-sided on that mission this week. I had previously thought it striking that an ‘old economy’ stock index like the Dow Jones was outperforming the broader economy index – the S&P 500 – in 2022 by a quantum not seen since 1933. Less surprising was the Dow Jones beating the tech-heavy Nasdaq index by the most since the TMT meltdown in 2000. These data points were teeing me up for 2023 thoughts along the lines of a rebalancing of the tech sector in the context of the broader economy, a pausing of tech giddiness and excess so to speak. And then I read, or should I say chatted? Let’s start with the reading…..

First email of the week was a handy round-up of green technology and regulatory activity from Callaway Climate Insights. Given my tech thinking was in rebalancing mode I have been looking for positive broader economy offsets to weigh against the stream of poor headlines from the tech sector itself. What I wasn’t expecting was the ‘rebalance’ to be happening within tech itself. So, imagine my pleasant surprise to read that climate tech investment levels are on track to match 2021’s historic highs. More striking was climate tech’s increasing weight in overall capital deployment, at a whopping 25% of every venture capital dollar invested in the last quarter. It’s not just equity. Clean tech is being banked too.

In late October €3.5 billion of debt funding was secured to build a hydrogen-powered steel plant in Northern Sweden. Operations at the H2 Green Steel plant are expected to start in 2025 and targets 5 million tonnes of steel production by 2030 with a 95% reduction in CO2 emissions. Exciting times and good to see Europe taking the lead on hydrogen but you ain’t seen nothing yet. Current estimates of the capital investment required for the global economy to shift from fossil fuels to cleaner energy over the next 30 years is in the region of $275 trillion. That’s more than $9 trillion every year for the next thirty, or more than the combined annual GDP of Japan and Germany! One would be tempted to say digital Big Tech could be swamped by that capital investment shift but then the chat, or chatter started…..

Over the last 20 years I would read a variety of weekly blogs, newsletters, thought leaders etc every week in a deliberate attempt to gather a variety of views on different topics which have aroused curiosity with better minds than mine. For the first time ever this week there was ZERO variety. All of them were writing about the same thing, and in nearly all cases it was blowing their minds. The source of excitement was artificial intelligence (AI) chat software which has been trained to interact with users in a conversational manner and generate human-like written text. The chatbot is called “ChatGPT” and has been trained by an Elon Musk-founded venture, OpenAI, on a huge sample of text scraped from the internet.

These text-generating AI tools have been around since 2020 but ChatGPT is super-easy to use and can deliver on the most astounding requests. How about asking it to write some code for you, or write lyrics for a song in the blended style of Adele and Cher, or write an essay on the impact of the FTX collapse on effective altruism? Just type in the request, then wait mere seconds. The answers have been mind-blowing, not always accurate but the productivity opportunities are off-the-charts. In just 5 days this large language model(LLM) has picked up 1 million users. For context, Instagram took 2.5 months, the iPhone 74 days and Spotify 5 months to reach the same user levels. I don’t propose to do an in-depth analysis of ChatGPT’s capabilities in this piece but the following are worth a read if curious:

Ben Thompson at

Packy McCormick at

David Peterson at

Mario Gabriele at

I am skipping the ChatGPT capability details to make a broader point. This feels like a “moment” for AI and I’m not sure the world will ever be the same again. What happens to homework? Do I get to write the sequel to “It’s a Wonderful Life”?   What happens to copyright law? Or university essay assignments? Oh, and did I mention that AI is not just generating text(based on probability, context) prompted by human text? Text generated images, avatars and art are also possible now thanks to another AI technology tool called ‘stable diffusion’ and used in our headline image. The productivity opportunities are vast but the ethics and governance of AI pose significant challenges. As a creator I am half terrified. Who needs video scripts, investment pitches, government tender applications or market analyses when these can be generated on demand from a bot? That fear is for another day but let’s complete the AI tech circle on a more positive note

Like the steel plants in Sweden, the broader economy can benefit from a dramatic technology shift as investment dollars move to new projects. Recall our recent article “Did You Xi A New War With China Has Started?” and you will know the Biden administration is very keen to on-shore semiconductor chip production and keep the US lead over China in more advanced chip technology. Which chips you might ask? Yip, the ones that power artificial intelligence(AI). And… if you’d been watching your headlines this week you’d see that TSMC’s $12 billion investment in an Arizona based chip manufacturing facility has now morphed into a monster $40 billion investment. You won’t see that on Fox News!

As a final thought, and a reflection on my initial thinking on 2023, I am reminded of the work of Brian Arthur and the Santa Fe Institute on complexity economics. Rather than traditional equilibrium economics thinking with rigid winner/loser frameworks, Arthur’s words seem prescient:

“Complexity economics sees the economy as in motion, perpetually “computing” itself— perpetually constructing itself anew. Where equilibrium economics emphasizes order, determinacy, deduction, and stasis, complexity economics emphasizes contingency, indeterminacy, sense-making, and openness to change…. We also see the economy not as something given and existing but forming from a constantly developing set of technological innovations, institutions, and arrangements that draw forth further innovations, institutions and arrangements.

One senses a complex “computing” world is about to become a lot more complex. So, expect plenty of AI dreams and chat this Christmas…..



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