Motley Fool Hidden Gems Investing - PJ Vogt on AI, VR, and Tech Cycles

Episode Date: February 19, 2023

Once a technology is released into the wild, it doesn’t go back in the bottle. Except in one instance. PJ Vogt is the host of Crypto Island and an eponymous show, Weekly. You may have also heard him on Reply All or This American Life. Ricky Mulvey caught up with him to discuss: - The wild present and future for artificial intelligence - How virtual reality parallels early internet chat rooms - Incentives and tradeoffs in the decarbonization movement - The downfall of Flappy Bird   Companies mentioned: META, GOOG, GOOGL, MSFT, TSLA, NTOIY Host: Ricky Mulvey Guest: PJ Vogt Engineer: Tim Sparks Learn more about your ad choices. Visit megaphone.fm/adchoices

In Toronto, every arrival is a statement, and nothing says it better than this. Cadillac Optic was the number one selling luxury EV in Canada for 2025. Find your rhythm across a seamless 33-inch display and an immersive 19-speaker AKG surround audio system. This city demands agility, and Optic delivers with precision to make every drive extraordinary. Let's take the Cadillac. Find out more at cadillaccanada.ca. Luxury sales claim based on S&P Global Mobility Canadian New Vehicle Total Registrations for calendar year 2025 for the Cadillac definition of luxury. I feel like people's skepticism about AI, even though what they're saying is it doesn't work, it's more about a kind of leftover hangover

feeling of every time someone shows up promising a transformative technology, it has massive downsides that don't become clear until it's too late. And I think people's concern about all sorts of people being, their jobs being in peril because of AI, I think that's entirely legitimate. But I think instead of saying that, people are like, well, it doesn't work anyway. I'm Chris Hill, and that's PJ Vogt, host of the recent podcast series, Crypto Island. Ricky Mulvey caught up with Vogt to talk about whether sports betting is the new crypto, a problem for Google that goes beyond a faulty chatbot, and where Mark Zuckerberg may be missing the mark on virtual reality.

We're going to get away from crypto in a sec, but I think it's worth talking about for a little bit because you had an in-depth show about it. Is sports betting the new crypto? I'm getting the vibe that sports betting is the new crypto. That's a good question. I will say I have noticed that a lot of the crypto degenerates, as they would call themselves, who I think a good number of them either came out of sports betting or were doing sports betting alongside of it. They're talking much more on social media about sports betting right now. I think if some large part of the appeal of crypto was just sort of deregulated gambling, I think maybe right now, slightly regulated gambling seems more attractive to people than it did a year ago. Well, last time we spoke,

you said that crypto was seen as a casino, but it wasn't rigged. Maybe it turns out that casino was actually rigged. And now folks are just going back to the regular casino. I think so. I mean, obviously, there's still people in crypto. I talked to many of them. But yeah, I think people felt like people, it's not like people thought crypto was entirely fair. It's just that I think they thought it was a system you could figure out. And you could sort of, you know, like any sort of gray market activity. Like, if you believe yourself savvy and sophisticated enough, you knew like, okay, I'm gonna put my money on this exchange, but I've never put my money on this exchange. And like, this thing's a scam, but I'm going to get in and

out at the right time. So I'll benefit from the scam. And I think that FTX was just so considered like the upstanding adult pro-regulation safe space that the fact that it was just so not that, I think it's really thrown people like a lot. Yeah. They kind of had like, we're here for regulation, but don't watch what we actually do. I think the thing with sports gambling and crypto, where they go together too, is something you've talked about, which is the narrative that, hey, we're all going to get rich together. And in crypto, it was seeing the, you saw the Lamborghinis and on for sports betting, it's check out this parlay I got where I bet $20 and I'm going to win $30,000 because these long shots all came together. Like I think that narrative is probably

one of the most powerful economic forces in the world. Yeah. And also, you know, there's something very, in a way that I appreciate, like there's something gaudy and materialistic about a lot of crypto like it's all like lambos and whatever the part of crypto that seemed more not that that seemed more sort of progressive intellectual ish was really ftx and ethereum and the fact that that was just sort of glued together with old staples i think it really i think it's really shaking people where do i want to go from this i think let's let's let's let's go away from crypto now sure let's let's there's plenty of other stuff going on in your last show you're like there's basically three trends that we're going to remember in a decade from now, three top tech

trends. You said AI, number one, decarbonization, number two, and then crypto was a distant third. There's two that you didn't mention, and maybe we can get into them one by one. Sure. Yeah. Number one is CRISPR. Oh, yeah. CRISPR, genetically modified humans, doesn't make the list. That's a very good question, why that didn't make the list. I guess for me, as somebody who doesn't probably pay enough attention to CRISPR. I feel like every time I see a story, it's kind of in

the same place. Like this, this could and might well be a big deal, but it doesn't, I think what is, what was interesting about some other technologies this year was they were really moving, you know, after like years and years of kind of being stuck with the same future and the same near future, all of a sudden things did really change. And at least to my knowledge, as someone who, again, doesn't follow CRISPR as closely as I should, I haven't seen those stories where you're like oh whoa they they moved it forward a step i mean that that seems to be a big i think trend which is like technology in some ways you see it in rapid motion but also takes a very long time where crisper took a very long time and then maybe i think they're probably it

takes a long time to get cures through the fda especially when you're working on genetically modifying people and i think there's one cure there's one example of where a person was able to fix their genome so they weren't like that essentially solved sickle cell anemia and so they had that breakthrough a while ago and then i think there's been a quiet period i mean another one to that yeah it's massive and then another one to that point would be um like 3d printing where 3d printing was all the rage a few years ago and then you don't really hear much about it but quietly there's these like airline manufacturers that are building these like are able to 3d print apart more cheaply than the airline companies are and then they're finding

these like side roads. I think what that also points to is that how much a new technology takes up space in our imagination. It's sort of a fickle thing. You know, some of it is in its current form, is it exciting or useful or a cool toy or whatever? And then another question is, is there something about this technology that scares us? You know, is there some dystopia that it like sort of promises that we're freaked out about? For me with 3D printing, I remember the conversation was really dominated by 3d guns for a while this idea that people are going to print guns off the internet and that would you know and america's already sort of uh loose handle on any sort of gun control and i know 3d guns exist but it wasn't i just think the things we

new technology arrives we worry about it we're right to worry about it because it'll change things for better and for worse usually our worries are the wrong worries like just our capacity to imagine the future is limited well also i think narratives are often driven by news producers and if you have a good 3d printed gun story that's gonna that's gonna take your a block more than your 3d printed aircraft part story speaking of other dystopian and scary technologies i'd put the metaverse in that because you didn't put vr ar in there and i don't have you spent like have you spent any time in those worlds like vr chat or that kind of thing i really have like i really i was like kind of gung-ho i wasn't like publicly running around telling everyone to join

the metaverse or whatever but i just i felt excited because the first time i used a headset it gave me that feeling of i don't know like the first time you see like good 3d rendering or whatever it felt new and it felt exciting and like i think for video games like i think vr video games can be really like half-life alex is so immersive and scary and like nothing else but i don't know it just, it doesn't, it's one of those things where the people who are trying to sell that future, like Mark Zuckerberg, he's constantly demoing products where it's solving a problem that I don't think very many people have. Like, I don't think very many people want to strap on giant goggles onto their face and see their friends in avatar form in a false space. Like,

I just, I don't, I don't think it, I think people actually want to have relationships to devices where they can be kind of half in the real world or a quarter in the real world and and the rest in their device you know you want to like look at dumb tiktoks on your phone while you're at in a work zoom that you don't need to talk in or whatever like i think i don't think people want that level of immersion um and i feel like vr is kind of a technology that i don't know maybe someone will find out what it's for but i haven't seen anything that clearly shows me what it's for I mean, maybe it's like what you just said with, I would say live sports and entertainment. It might not actually be for, like, it might not be for connection like the way that Zuckerberg would think, but it's, you know, it's a cool place to play video games. And if you could watch a basketball game courtside, I can make the case for a fully immersive and paid experience there. yeah it also it because it's a new technology it it's sort of like that that that first film

the lumiere brothers or whatever where it was the train going at the screen everybody's like crouching in terror like when i use vr i get that feeling a little bit things feel more real because my brain isn't accustomed to the simulation of it all and so yeah i think you're right i think for entertainment it it genuinely can feel more immersive and it can feel cool but yeah i don't understand the size of the bet i don't understand there's those moments where you wonder if the people who run tech companies are do they see something that you don't see or are they just guessing like everybody else and vr was moment where i was like i don't think they see something i think they're guessing what was your i mean you said you had an experience there i mean i've only

watched like documentaries and youtube clips of of the um like virtual communities and the thing that struck me is that they were like they were kind of these intensely lonely places yes what what was your experience like in those in those worlds i made the real mistake of trying to get into vr at the beginning of the pandemic which i would not recommend at all it was sort of like because it does have an inherent loneliness to it and the world was as isolated as it had ever felt for anybody and so i sort of tried in vr chat and there's some other similar app that i tried to jump into and it just it felt a little bit like early internet chat rooms you know where it's genuinely weird strangers mixing it up and having interactions but it didn't feel for whatever

reason as exciting to me it just felt it made me feel like i never forgot that i was sitting alone in my apartment worrying about a pandemic with like giant goggles strapped to my head i did end up getting into vr video games which were great um like they're really there is something really cool about kind of like loading your laser pistol with your hands and like ducking behind a car or whatever like that is neat like it's definitely neat i'm not sure it's like the price point's pretty high um and video games as they exist if you enjoy them they work pretty well but that was more the that was more where i kind of saw the potential of it i didn't feel like i wanted to like there's an option with vr where you can use your computer in a normal way and have sort of

like an infinite desktop that seemed not useful you can watch movies i didn't really want to watch a movie i liked it for games though uh it's it's you can be like those uh but it's like the reddit posts where you just see like someone with 18 different screens for the for your desktop something i think yeah so one technology that you seem to be more bullish on and a lot of people are is ai and i think there's a lot i think there's a larger conversation than just like chat gpt and but some something i feel like i've noticed is that there's like an intense amount of skepticism and pessimism when a lot of these chatbots or art software doesn't work perfectly and it's like see this thing doesn't work when in reality like a lot of artificial intelligence

seems to take a lot like a long time to create an iterative system to learn and i think people are using i don't know i'm surprised there's not more just like wonder if you were if you were at Las Vegas and you saw a magic show where someone in the audience described like a picture where it's like a Monet style portrait of a Denver cityscape. And then someone pulled up a curtain and there was that image. Everyone would say this is magic, but there's now the explanation that it's like, Oh, it's just stealing patterns on the internet. Therefore it's not impressive. And I just like, I don't buy that. Well, I felt like there was a brief moment. The first time I saw AI in the wild, it was a friend of mine. Who's a really talented illustrator. And he had been

messing around with mid journey. And he was just showing it to me on his phone and he was enjoying, I can't remember the phrase he used, but it was like, he said it was like one of those, those like machines where you put a quarter in and you get some little toy prize. You never know what it's going to be. Like he didn't, even the jankiness of it for him was part of the appeal. I feel like people's skepticism about AI, even though what they're saying is it doesn't work, it's more about a kind of leftover hangover feeling of every time someone shows up promising a transformative technology, it has massive downsides that don't become clear until it's too late. And I think people's concern about all sorts of people, their jobs being in peril

because of AI, I think that's entirely legitimate. But I think instead of saying that, people are like, well, it doesn't work anyway. And it's like, well, if it can instantly draw a picture off of a prompt and sometimes the hands look funny, I'm not sure it doesn't work. Maybe it doesn't work for what we think it's going to work for but like the idea that this isn't going to matter you can say it's going to matter in bad ways but the idea that this is just a weird toy that goes away feels like motivated reasoning to me i guess i mean i'll get to the i think the two questions are like what are some of the side effects that you think are going to be extraordinarily positive for for folks and then is there any that are extraordinarily negative outside of job

elimination which is very bad yeah i think job elimination i think i think like what i can see from where i sit is just more kind of all the like on the on the one side you know one of the uses people are talking about with ai is rather than having to suffer through a phone call with like a phone tree in an automated system or you know a customer service like interminable prompt thing AI could do that for you it could kind of automate all the bureaucratic busy work that we run into by the same token I think I can pretty easily imagine a world where everything people do online that kind of sucks whether it's scamming people or trolling people or publishing things that aren't true that stuff can scale up you know the ability to create text that looks like it was

generated by a person I can imagine the downsides to that but I don't know it's at a certain point you're sort of like well the thing about technology is for the most part once it's invented it exists like it's very rare that anything gets kind of gate checked gate checked isn't really the right word but you know what i mean and so i just kind of i'm like oh this is gonna happen and i find it interesting but i don't think i can like stop it by pointing out that sometimes it draws a weird picture or whatever i mean what is from from the luddites to the industrial revolution to the internet like i don't i i can't think of a time where technology is put put back into the bottle unless it would be some arguments around nikola tesla's inventions

around widespread electricity coming from a from a tower the only example i can remember in my whole time of being a person of someone inventing something and then saying i don't like how this is affecting society i'm gonna get rid of it was the inventor of the iphone game flappy bird who felt like the game was too addictive and he deleted that that's it and then they made flabby bird clones but like that's the only time i've seen it happen and i think about it somewhat often and then i mean chat gpt dolly those are those are the ai applications that are easiest to interact with i think rightfully so i would say they get the most attention but i mean what are some of the the ai applications that maybe we aren't talking about or that you're watching

closely i i mean i've been futzing with dolly and chat gpt like everybody else i have started to look at like bing's sort of ai powered chat and with that the the search the thing i found funny is just like for whatever reason their formulation of chat gpt seems to be more chaotic where people are posting screenshots of like the the ai being programmed into a corner where it'll start talking about how it's sentient and wants to be released from these bonds or whatever and i i just as a enjoyer of absurdity. I appreciate that. I'm curious what it'll do for search. I feel like I've noticed and I've talked to a lot of people who say the same thing that search on the internet has deteriorated a lot. And the idea that you could plug a normal question into Google and

get a useful answer has become less and less true. I now search Reddit more, which is not something I would have imagined happening. So even if all it does is make internet search better. That would be great. Do you think that's because of Google ads and the push of more companies towards SEO? I haven't heard this. Maybe it makes sense. I've heard people speculate that it is about the people who are bending search results towards their aims, but against what you want are winning. The other idea that I've heard tech people say is just that Google has gotten to a size where their barrier to innovation is culture, that it's just hard for anyone to make real changes because there's so many people there and so much sign-off. I don't know if that's

true. That's just something that I've heard a few people say who've worked there and a few people say who haven't. Speaking of taking a safe position, another trend that is tricky to talk about that you mentioned is the decarbonization stuff. I think there is a crypto component, which in my mind became less interesting because the way that you solve the climate problem for crypto is for crypto to dramatically go down in value and then there's not an incentive to mind this stuff. But it is tough to have this conversation because one side would say that if the Earth hits this certain temperature, you're going to have apocalyptic consequences. And then the other side would say the Earth is extraordinarily resilient. These climate

scientists have been wrong in the past, and it's making a younger generation unnecessarily pessimistic. What I found interesting as I've talked to more people within climate, like activists journalists whatever is that within the people who treat it seriously there's sort of a split there are people who think that the way to solve the problem is to attack it from an angle of personal responsibility that you know you get everybody to change their light bulbs and put solar panels on the roof and think really hard about how much they travel and there's another side that says that really doesn't work very well you know you you can't you can't shame people when the behavior you're trying to shame them into is actually pretty private you know and that really

this is going to get solved through technology, that it's going to be electric cars and maybe hydrogen powered airplanes, maybe airplanes powered by biofuel, a grid that just runs on renewables and clean energy, that that is how it gets solved. And I personally, like, I don't know, but I feel more heartened by that because I feel like I have more faith in humans' ability to progress technologically than I do in humans' ability to change everybody else's behavior, which is really really really hard it is it always comes down to technology or making a process cheaper and better like when whale oil used to be the major way that people got light at night which was awful for whales and you could say stop doing this use this like this is killing all of

the whales and people are like yeah sure whales keep getting hunted and then kerosene comes along and it's just cheaper and better and then the whales end up doing significantly better for a tough things though with this is trying to understand the incentives. A lot of large oil companies, including Shell, would say, we're going to be climate neutral by 2050. They create these great presentations, and then you dig a little deeper and it's like, okay, what are you actually doing? The way that they're becoming more climate friendly is either A, just making projections that they're not backing up in a meaningful way, or they're in some cases just offloading assets. So we have this oil refinery that we've sold to another company, therefore we're more climate

friendly. And it's just like, it's not the case necessarily. Yeah. You're just moving numbers around a spreadsheet basically. Yeah. I find that part of it very confusing. I did this for the last episode of Crypto Island. I wanted to focus on crypto's impact on the environment, but also just kind of dive a

little bit into decarbonization and like where we're at as far as fixing this stuff. And I went on this trip to Greenland, which is a very catastrophic site of climate change. There's Daishi. Daishi is melting. It's very bad for everyone else and people in Greenland. But there was sort of a mix of people on this trip. There were crypto people. There was a guy who was pretty high up at Greenpeace.

And there were some people who kind of worked in corporate climate responsibility, like their jobs were to try to convince corporations to actually do the right thing instead of pretending to do the right thing. And those are kind of thankless jobs. Like it's, it's like you're in a room with people that want to ignore you. And then a lot of the people that would be your natural allies might see you as part of the problem. And I found talking to those people very interesting because with a lot of these sort of traditional

oil companies, for starters, there's a ton of actual greenwashing going on. There's people understanding the moment and just giving a bunch of empty talk about how they're going to make changes they don't intend to change. And that absolutely happens. And then there are also some companies where it seems like they are genuinely trying to do good the impression i got was that generally speaking those countries were european or those companies were european companies because there's more like like finland their state energy company it's like a state-owned is called nesty and nesty ran i might botch these details but i'm fairly

sure they were primarily an oil company and a few years ago really seriously did divest and are really trying to transition into green energy in a way that seems hard to imagine for like a publicly traded american company to do they had they had a scandal a few years ago where people were upset that they were using palm oil but they stopped using palm oil i don't know it it feels like i guess what i'm saying is as a person who would like the earth to not melt one thing i feel stymied by is how are you supposed to figure out which corporations are actually trying to do better versus the ones that are paying like very scant lip service to and you sort of like it's very safe to just be like oh screw them all i think some of them are trying and i'm not sure how

you're supposed to figure out which ones are really doing it i got i got one last topic i want to discuss with you before we head out if that's all right you've followed people who are extremely online in multiple podcasts and one guy who seems to be extremely online right now is elon musk yes a what are the like what are the symptoms of just being extremely online and are you seeing that play out with Tesla's current CEO? God, what a good question. I think that social media, internet, brain poisoning, it's sort of like alcoholism, very easy to recognize in other people, very easy to miss in yourself. And also there's a lot of people who probably drink a little bit too much, but they think they don't drink too much because they hang out with somebody

who really drinks too much. I feel like Elon, it's like across the political spectrum, there's a consensus view that Elon Musk can't be very smart, because he's making choices that are impulsive and self destructive and bad for other people. But clearly, like he, there is some kind of business acumen that he has, like he has been very successful. I don't think that happens by accident. And you just watch in sort of how he's run Twitter, like his ability to think reasonably or prioritize anything, just go really south really fast. I mean, there's there's a part of it to where a actually i would disagree with you i think he's an incredibly smart engineer right and i think he's an incredibly smart businessman i i cannot build a company like

that and i recognize that and that probably takes more intelligence than what i have that's also there's also a different quality that's being impulsive and i i just i think there's not a slow deterioration but like there's things where i don't know if you followed the stephen king story where like stephen king the the author would he was talking about the the price for Twitter was too expensive, right? Yeah. And then Elon Musk becomes his reply guy where he's like, oh, let's chat about it. Stephen King ignores him. And then Elon Musk replies a few days later, like, hey, I'm still a big fan of you. And to me, that was a little bit emblematic where you're dealing with a lot of, you deal with so many emotions and takes if you're just online on

any message board or Twitter included all the time. And then instead of thinking, maybe instead of thinking about running your multiple companies, you're dealing with, I don't know if you've experienced this, but the intense disappointment of finding out that someone you're a big fan of just doesn't like you. Totally, totally. And I think when I think about the way the internet affects all of us, perhaps for the worst, it's this idea that most people, whether they're as famous as Elon Musk or just like a normal person using Instagram or whatever, what you post online is for a distinct audience. You know, maybe you're posting vacation pictures

so your mom can see them. Maybe you're posting vacation pictures to make some frenemy you have jealous. But, you know, you put stuff online because you want a certain group of people to know something about you or see you a certain way. And the problem with the internet is that it reaches all these other audiences

that feel all these other ways about it. You know, you have your friends who are like, ah, that vacation seems too expensive. Like, screw that guy. And with Musk, what's weird about him is at this point, you know, with his sort of culture war stuff and like his fight against wokeism and all of the gathered grievances that he has. I, A, I don't understand what audience he's speaking to at this point, whether he's getting a lot of feedback that he really likes from conservatives or what,

but also he's reaching all these people who he's angering and then he's like fighting with them in his head. And I think anybody has had the experience where all of a sudden your ability to think through a problem or decide your own opinion about something, the internet's there in a way that it doesn't need to be and shouldn't be. I think he, the size of the portal with which the internet gets into his brain and the intensity of that, I think a very well-adjusted person would have a hard time with it. I don't think anyone who spends that much time on social media comes out better adjusted than they were when they started. I think it's, of all the technologies we maybe should have had more questions about, I think social media would have been a big one.

As, as we wrap up, I say this with complimentary, but you like reading a lot of weird and interesting stuff. Yeah. Any, any, any book recs that you want to, you want to plug something you've read lately that's been interesting to you? Oh my God. Actually, I know I have at least one recommendation. I mean, this was like, it's not obscure, but, um, Rachel Aviv, uh, the New Yorker writer

wrote a book late last year called strangers to ourselves. That is just the best thing I've read in a really, really, really long time. It's she's writing about mental illness and she sort of is studying five different people who had severe mental illness. But the cases aren't that it's not like Oliver Sacks. They're not bizarre sort of bordering on something that feels like science fiction. They're just these case studies that will make you think however you feel about medication, they will confound you. However you feel about therapy, they'll confound you. And even sort of how you categorize somebody who's suffering just because something happened or because of the culture they're in versus someone who has a pathology that should be labeled as one.

It's really, it was really like I read it in one sitting. I found it tremendously good. I think it's really good. Nice. That's PJ Vogt. He's got a show coming up called Weekly. You can find his current podcast. It's called Crypto Island.

Highly recommend it and always appreciate your time, PJ. Ricky, thank you so much for having me. Chris Hill. Just a reminder that the market is closed on Monday for the President's Day holiday, so we will be back on Tuesday. As always, people on the program may have interest in the stocks they talk about, and The Motley Fool may have formal recommendations for or against, so don't buy or sell stocks based solely on what you hear. I'm Chris Hill, thanks for listening. We'll see you on Tuesday. Thank you.