QUESTION: Marty; Socrates has done a fantastic job in picking turning points, rallies, projections for resistance, so many things. Yet IBM’s Watson was supposed to blow everything out of the water and find the cure for cancer and it has failed miserably. What did you do that IBM did not?

Also, the rumor is that China has made you a huge offer even citizenship because they intend to be the leader in AI. That’s why you’re having a WEC in Shanghai. Is there any truth to that since Socrates covers all of the main Chinese stocks as well?

JH

ANSWER: IBM’s Watson was simply a giant neural net. I have explained before that I toyed with that back in the 1980s and quickly saw that it would lead nowhere. Real Artificial Intelligence is something that learns and analyzes on its own to create its own conclusion. In all honesty, 99.999% of what people present as AI are simply expert systems that can be distinguished rather easily because all they are doing is looking up some subject from rule-based systems.

IBM’s Watson could search the entire internet and gather every piece of information possible. That was the easy part. What IBM lacked was the expertise in how to do research. How do you know that one piece of info is the key or more important than another? They lacked the ability to create a real analysis capability.

Neural Nets were a great hope that somehow you just throw in all this information, shake well, and out will magically appear the answer. The presumption was that our minds are just supercomputers and they ignored perhaps the critical understanding of what makes one person brilliant at math and another a brilliant artist who can’t count beyond 1,000.

This theory that our minds are simply supercomputers ignored some critical traits and how to distinguish one person from another. There was this idea that if you create a neural net and stuff in all this knowledge it will learn all by itself. This was just a giant fiction to me, which was up there with the theory that somehow the machine will come to life and decide it wants to rule the world and take over humankind.

My approach was to teach it HOW to analyze, not WHAT to analyze. I created in the code as much of myself as I could without the human flaws that keep life interesting. I taught Socrates HOW to analyze and did not leave that to the chance of a neural net that cannot be tested.

I then had to teach it language so I could communicate with it to try to understand how it arrived at such a conclusion. I used my children to improve Socrates’ language skills back in the 1980s. I wrote a program to have an ongoing conversation with them. My daughter believed it was alive and would bring her friends over to show them a computer that talked.

Now as for China, no I do not have an offer from the Chinese government. We have been focused on expanding our services into China and we are not blocked like most other analysts because they do understand it is a computer writing all these reports so there is no risk of a person sneaking into paragraph three and writing, “BTW, overthrow your government.”

Yes, I would take in a major partner who brings something to the table in the field of expertise. This is not a start-up operation. We do not need money to fund a theory. We have clients in more than 137 different countries and a track record of more than 40 years.

And no, we have not been approached by IBM