Money Rehab with Nicole Lapin - AI Drama and FINALLY Good News on Inflation

Episode Date: November 22, 2023

On this week's roundup of the biggest headlines on Wall Street and how they affect your finances, Nicole decodes the Sam Altman drama with ChatGPT and OpenAI, Musk's latest lawsuit and some good news on inflation... finally!

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It's time for some money rehab. Here's your weekly roundup of the biggest headlines on Wall Street and how they affect your finances. This is a juicy, juicy episode, and we're kicking it off with a chaotic mess over there at OpenAI, which is the company, of course, that made ChatGBT. To ease us into this, I want to read you a quote from a New Yorker profile of Sam Altman from all the way back in 2016. It's kind of a long quote, but trust me, it's worth it. The background of the quote is that Sam Altman is discussing his hobbies and he says, quote, I prep for survival.

My problem is that when my friends get drunk, they talk about the ways the world will end. After a Dutch lab modified the H5N1 bird flu virus five years ago, making it super contagious, the chance of a lethal synthetic virus being released in the next 20 years became, well, non-zero. The other most popular scenarios would be AI that attacks us and nations fighting with nukes over scarce resources. I try not to think about it too much, but I have guns, gold, potassium, iodine, antibiotics, batteries, water, gas masks from the Israel Defense Forces, and a patch of land in Big Sur I can fly to, end quote. I share all of that to give you a frame of reference for

the guy who is at the center of the biggest AI breakthroughs this year. ChatGBT, everyone's favorite AI. To understand anything about this story, you need to know two things. You don't need to believe them, but you do need to remember them for this story to make any sense. One, some people who are seriously involved in the development of general artificial intelligence believe that it could pose a massive apocalyptic threat to the human race. And two, some people believe AI will be the most lucrative development of all time. There is a Venn diagram where those two circles overlap, and Sam Altman has spent a lot of the last few years in that space. Altman believes that the threat of AI is almost equal to the promise it holds to

solve many of the human race's problems. Given that worldview, he and a few others founded OpenAI, which has a very unique corporate structure. The company was actually founded as a nonprofit and supported by donations. And the motive for the organization was altruistic, humanitarian, nonprofit-centric in nature. This noble vision ultimately ran into the reality that developing AI takes boatloads of money. From the servers that function as AI's brain to the people to code it and train it, every step of creating true artificial intelligence just guzzles cash. So Altman created a for-profit corporate subsidiary of the company to take on outside investments, although those investments

would be capped. Their official page about their corporate structure says, quote, It would be wise to view any investment in OpenAI Global LLC in the spirit of a donation with the understanding that it may be difficult to know what role money will play in a post-AI world, which is honestly a little unhinged. The nonprofit controls the for-profit subsidiary, and the whole thing is governed by a board of directors, including founders like Sam Altman, as well as other experts in the field who do not have a financial stake in the business. The idea is that the board of directors would act as sort of a moral leash on the company, directing its work in a way that resulted in a benevolent AI that would aid humanity, rather than a sort of AI that would have Altman flying, I guess, to Big Sur with guns, gold,

and gas masks. At some point recently, something that Sam Altman did triggered that independent board of directors to fire him, which they can do because they oversee the operations of the OpenAI company and its money-making wing. The board didn't have to consider the feelings of major investors like Microsoft, because that's none of its business. It is only interested in what creates a benevolent AI. Microsoft, which provides much of the computing power of open AI, as well as a significant portion of its funding, was not happy, to say the least, about the ousting of Altman. On Friday, the board's official stance was that Altman, quote, was not consistently candid in his communications with the board,

hindering its ability to exercise its responsibilities, end quote. This is probably code for something like he was trying to profit off AI in ways he knew the board would object to. This story could have huge global implications and impacts, or it could be the tiniest of teacup tempests. The question is, did the board fire Altman because he was developing technology they found dangerous, or because he was raising money, or because he was profiting from AI in ways the board found unethical? While this could be about the future of life on Earth, it could also be about boring details of corporate governments.

What we do know is that Altman was quickly offered a job by Microsoft, leading an advanced research lab there. But Altman didn't come alone. The vast majority of OpenAI's employees quit in protest and seem very willing to follow him to Microsoft to continue their work there. So they appear to continue to have faith in him, and Microsoft's stock rallied on this news. This is a random lucky break for Microsoft. They are acquiring some of the greatest institutional AI knowledge around without actually facing any sort of monopoly oversight or lawsuits. I mean, if they went out and tried to buy OpenAI, it seems probable that the government would have many questions. However, the exodus of employees

would leave OpenAI a hollow shell of a company. So that is where things stand at the time I am recording this. Assuming the Altman story doesn't end in a dystopian universe run by AI, it is a very fun story about an eccentric tech founder and the company he's in the process of maybe ruining. Elon Musk used to be fun, but not anymore. Like Kanye West, it doesn't really matter how many times I listened to 808 and Heartbreaks during a breakup in 08. After he made anti-Semitic statements, I removed him from all of my playlists because no one needs an anti-Semite in their lives. And I think it might be time to remove Musk a little bit more from my life as well. Under Musk's management, X has basically

abandoned content moderation. The company has claimed that it is doing so for free speech reasons. But since Musk has gutted the company and content moderation is time consuming and can't really be automated, it's also possible that it's simply too difficult and expensive. This has created an environment where neo-Nazis and other white power movements have flourished. Musk has flirted with a great deal of problematic speech himself, and this weekend took it a step further by explicitly agreeing with a really gross anti-Semitic post. Into this toxic soup comes several reports of just how scary it's getting over on X. One study found that premium

X users are pushing the great replacement theory and other racist and anti-Semitic tropes, which have led to real world violence. Another study documented ads by major companies next to Nazi and white power content, which these advertisers definitely didn't want and makes them concerned that X is no longer a brand safe place to advertise. As a result, major advertisers like Apple, Warner Brothers, As a result, major advertisers like Apple, Warner Brothers, Disney, and IBM have all pulled back advertising from the company. Musk has responded with a lawsuit. If only X had an independent board like OpenAI. And also, I have used the name X so far in this episode, and I hope everyone can hear just how ridiculous it sounds. It almost sounds like I'm talking constantly about a former partner like an ex. Anyway, unhinged branding and Nazi content are a big no for me. But as a Jewish person, these comments create a risk for me, my family,

and my friends. So I am not sure if Elon Musk is anti-Semitic or not, until I am sure I'm going to reduce some of my content coverage of Musk, and you can probably find me more on threads than on X. I want to end this episode, though, on a positive note. Gas prices are falling just in time for one of the busiest travel days of the year. Not only is that great news if you have to make a long drive to see grandma tomorrow, it could also signal larger reduction in inflation and I'll take it. One of the biggest drivers of prices is fuel costs, and this could signal a larger reduction in inflation than expected. For today's tip, you can take straight to the bank. If you're feeling extra grateful this holiday season and plan to double down on that feeling by donating to a cause you believe in,

be sure to keep that receipt so you can write off the donation. I know it seems like a pain in the butt, especially if you're not giving very much. But think of it this way. If you saw a $20 bill on the ground, would you bend over and pick it up? If you would, then don't throw a $20 bill or more in the trash by tossing the donation receipt. Money Rehab is a production of Money News Network. I'm your host, Nicole Lappin. Money Rehab's executive producer is Morgan Lavoie. Our researcher is Emily Holmes. Do you need some money rehab? And let's be honest, we all do. So email us your money questions, moneyrehab at moneynewsnetwork.com to potentially have your questions answered on the show or even have a one-on-one intervention with me. And follow us on Instagram at moneynews and TikTok at

moneynewsnetwork for exclusive video content. And lastly, thank you. No, seriously, thank you. Thank you for listening and for investing in yourself, which is the most important investment you can make.