Steve McDonald: Hi, everybody. I’m Steve McDonald. This is your Market Wake-Up Call. Well, any boomer worth their salt knows what HAL 9000 is. That was the supercomputer that ran an entire space station in the movie 2001: A Space Odyssey and refused to be turned off.

And then, of course, there was Scotty and Kirk who, in the ’60s series Star Trek, routinely talked to their computers asking for solutions for their dilithium crystal problems and corrective actions from the bridge.

And here we are a few short decades later, and we’re talking to computers – Watson, Alexa and Echo. Our appliances communicate with our phones, and our refrigerator talks to the food store and then everything’s delivered. It’s amazing. We have self-driving cars and phones that fit in the palm of our hands and manage our lives. Airliners have dial-in, navigation speed and altitude control – all computer-controlled. They’re so hands-off that the concern is that pilots are losing their edge for flying them in emergencies.

Now, while these may seem like modern marvels, they aren’t even close to the leading edge of technology. Now we have terabyte storage and processing systems that can learn from themselves, learn from their mistakes and, some say, predict the future. In fact, they are.

Now, to put this into perspective about how far and fast this machine evolution has progressed, consider this… Just 30 or so years ago, my first computer was a Tandy 64K. It did almost nothing, but it was so cool to own. But just typing on it was a chore. In number representation, this is what 64K looked like. I’m serious, 64,000 is all it had.

Today we have multi-terabyte and exabyte storage, and processing systems whose numbers look like this. There’s a pyramid graph on the screen here. Our capabilities are exploding from there. All the words ever spoken by human beings between the dawn of civilization through 2003 could be stored in 5 exabytes of data. Five.

That much information, 5 exabytes, is being created every two days now, and we’re processing that information faster than anyone ever imagined possible. The average laptop computer today has more computing power than all of the NASA systems combined when it sent a man to the moon. Think about that… You carry this thing around in your purse for God’s sake.

What do you think a server with a gazillion bytes of information like this one can do? The picture is on the screen now. That’s a server farm. Robots and artificial intelligence (AI)… this is beyond Star Trek. And our guest today is working on a system that uses all the Space Odyssey and Star Trek stuff to do what many will think is impossible. Stay with me…

Wall Street is scrambling to corral all the AI talent it can buy to stay ahead of this curve, and our guest says the right combination of machine and man is already delivering huge returns in the stock market – four- and five-digit returns.

Our guest, Andy Snyder, the Founder of Manward Press, says AI can and is predicting what the stock market will do. So that’s all it is, Andy? Just predicting the stock market?

Andy Snyder: That’s right. So it’s a little bit more than what your Tandy used to do.

Steve McDonald: Yeah. I remember the little orange cursor blinking. I thought it was amazing. First up, what is AI? Give us a really quick description of what it is. Then give us a feel for how big the AI and Wall Street connection is.

Andy Snyder: AI is a wide spectrum. There are many different levels of it. Now we’re going from computerized algorithms – people programming computers to run certain data sets – to really getting into the idea of machine learning. And that’s where the exponential growth for the financial side is really coming in. Something like $2 out of every $3 that trade on Wall Street today are based on machines; the machines are making the trade without any human input. Mortgage companies are using AI to determine who is and who isn’t a good person to lend money to. We’re seeing it in portfolio management: People are using AI instead of going to financial brokers or analysts. So we’re seeing this all across Wall Street – people are going away from the emotional decisions made by people and going to machines.

Steve McDonald: How’s it working? What kind of results are we seeing?

Andy Snyder: We’re seeing huge results. Everybody knows the market had a really lousy 2018. I think 93% of assets across the world were in negative territory, and hedge fund Bridgewater – the flagship user of AI for investing – was up by about 14%. And I could go on and on with companies or hedge funds doing the same thing. We’ve found that by using this new technology and adding some twist to it, we’re looking at easy double-digit returns.

Steve McDonald: But there have been problems with digital systems running the stock market. The 1987 crash was because they couldn’t turn off the computer systems, isn’t that correct?

Andy Snyder: Exactly. We’ve seen that, and that’s why we’re kind of at the “version 2.0” of all this. And what fascinates me is the idea of – it’s a big word – quantamental analysis. That’s taking the old-fashioned, if we can even call it old-fashioned, algorithms of yesterday – literally of last year – and adding this human thinking element to it.

Right now we’re still adding the actual human brain to it, but these AI equations are self-learning. They make mistakes, and they learn from it. And with this quantamental idea, a lot of people are saying it can turn the average guy into a Warren Buffett. You can go out there and search the whole array of Wall Street – every stock and bond out there – and not only use very profitable algorithms but also use some mental learning that only humans have been able to do.

Steve McDonald: But let me ask you, is this finally the solution? I write all the time about how human emotions drive almost all losses for the average guy in stocks. Is this the solution – the interface of man with the supersystems?

Andy Snyder: It’s certainly part of it. I don’t think there’s ever going to be a solution because people aren’t going to always jump into this like they should. And what’s so great about what we’re doing right now is that it’s still adding the ability for humans to learn. There’s no way a computer can learn like we can right now. But if we can, as you say, pull the emotional side out of it with computers, that’s where we’re seeing the really, really big gains. And that’s where the idea of quantamental analysis is at.

Steve McDonald: Can you go down a list of what kind of winners AI is picking? I know you have a full report on this, don’t you?

Andy Snyder: I could go down a huge list, and that’s all in the report, but know this: On average, by using AI, we’re seeing a gain of 89% per day. Up until now, we’ve been trained to think between 5% and 7% is good. Most people can’t even beat the market and get those figures. That’s the equivalent of using a rotary phone versus a smartphone today. Most people are still in rotary phone mode with their portfolio analysis and their stock picking. They go out and mainly guess. The numbers might look good, but they have no idea. By going to this new form, we know with much more certainty where things are going.

Steve McDonald: Andy’s complete report is in the link below. Just click on it if you want to read all about this, which I would strongly urge you to do. Some of the numbers – like 89% a day – almost seem impossible. Andy, I’ve got to be honest with you. When you said that, it’s just like holy cow. How’s it doing that?

Andy Snyder: So there are 4,000 stocks out there, and every day we see them taking off. We’re using options and different strategies to really take advantage of that movement, and only a computer can go in there and find that. If you and I tried to do it by hand, we wouldn’t have any luck.

Steve McDonald: Now, would you consider me behind the power curve because I just last year got a smartphone?

Andy Snyder: Hey, if you got rid of your Tandy, you’re doing well.

Steve McDonald: I’m actually using parts of it now other than the phone. Thanks so much for being with us.

Andy Snyder: Thank you, Steve. I appreciate it.

Steve McDonald: And for everybody here at the Market Wake-Up Call, take a look at this. It’s is the future of investing. Thank you so much for being a part of this. We’ll see you next week.

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