X-Message-Number: 21825
From: "Mark Plus" <>
Subject: CBS MarketWatch: Investor warning: 'The Singularity' is dead ahead
Date: Thu, 29 May 2003 22:35:55 -0700


Tech funds headed into a black hole
Investor warning: 'The Singularity' is dead ahead

By Paul B. Farrell, CBS.MarketWatch.com
Last Update: 12:01 AM ET May 29, 2003

LOS ANGELES (CBS.MW) - The latest headlines are enflaming the 1990s mania 
again: "Look who's back!" "U-turn for tech!" "Tech: Where the action is!" 
"Tech powers markets!"

Here we go again! Back stalking tech funds. Well, enjoy it while it lasts 
because it may soon blow up in our faces, and not tech stocks themselves.

A growing contingency of scientists believe technological advances are 
accelerating at an exponential rate. At some point between 2005 and 2030, 
they say, everything we know about science and technology will implode into 
some kind of black hole called "The Singularity."

I've been hearing about quantum singularities on Star Trek for a while, but 
since most of my attention was on Seven-of-Nine, I missed it. Now it's got 
me concerned as I look past the short-term "temporal shifts" (to use another 
Star Trek buzzword) in tech sector prices and see a big new bubble forming.

After all, if the Singularity is a real possibility early in the 21st 
century, and not just some 24th century Star Trek fantasy, then it's quite 
possible any short-term investments in the tech sector will be dangerous, if 
not just plain futile, in the longer run.

Why? Because the entire global economy would also peak as technology rushes 
headlong into this Singularity ... before suddenly vanishing mysteriously 
into a black hole, perhaps emerging in a parallel universe or neo-ice age 

Of course, on the other hand, it might just be a super-nova version of what 
the great economist Joseph Schumpeter called "creative destruction" wiping 
out all prior technologies to make way for a radically new reality.

Fascinating stuff to think about, huh? Well stick with me, because it'll 
help put this tech rally in perspective.

A life-time exploring parallel universes

I got into this technology time warp by following my own advice as a college 
professor. Here's some background: Twenty years after teaching a graduate 
course at Cornell, I found out that students actually listened to what I 
said. Back in the early 1970s, I encouraged students to make education a 
lifetime adventure with this neat trick: Every time you're in an airport, 
buy a magazine that you would normally not read.

Years later when I was back visiting Cornell, one of my students, now a 
professor, told me he not only remembered, he's still doing it.

So do I. Today it's much easier. Just browse the newsstands at Borders or 
Barnes & Noble, grab a few oddball titles, buy a latte and muffin, sit, 
read, enjoy. It's a great adventure. Try it, I promise you'll learn 
something every time! Usually I end up buying a couple of the oddballs 
because something is unexpectedly fascinating.

Last Americans now boarding the Singularity

So that's how I wound up grabbing and reading "Exploring The Singularity" in 
The Futurist, "Parallel Universes" in Scientific American, and "The Last 
Americans" in Harpers. I didn't expect to see a connection.

However, together they suggest a rather frightening future for America, 
notwithstanding the hope and promises we hear daily in the non-technological 
world of political hoopla and the short-term hype of the financial media. 
The articles painted a picture of our great American empire going out in a 
blaze of glory, thanks, ironically, to the accelerating advances in 

And yet (note closely, because this is the insane part of the phenomenon), 
both the public and the politicians will be so fully convinced that 
technology is the new messiah, they will deify the principle of "progress 
and growth through technology" creating a newer bigger economic bubble that 
will make the nineties look like child's play. Then, sadly, the Singularity 
will implode (or explode), destroying the existing order, collapsing into a 
black hole and a new reality.

20,000 years of progress ... dead ahead

Is this a doomsday scenario? Not necessarily. In his Futurist article, James 
John Bell says that in the Singularity, "we won't just experience 100 years 
of progress in the twenty-first century, it will be more like 20,000 years 
of progress" in which machines will far outstrip human intelligence and a 
Matrix-like world will emerge with humans fighting for their survival 
against super-intelligent machines capable of self-replicating, thanks to 
stuff like nano-technology and the merger of bio-technology and robotics.

Interestingly, Bell quotes Bill Joy, Sun Microsystems chief scientist, 
warning us of "the dangers posed by developments in genetics, 
nanotechnology, and robotics." Joy fears that the "exponential technological 
progress run amok" will alter the future so dramatically, "we could be the 
last generation of humans."

Jared Diamond's Harper's article, "The Last Americans," takes a totally 
different perspective, yet comes to the same result. He opens with this 
ominous warning: "One of the disturbing facts of history is that so many 
civilizations collapse. Few people, however, least of all our politicians, 
realize that a primary cause of the collapse of those societies has been the 
destruction of the natural resources on which they depend."

"Fewer still," says Diamond, a Pulitzer Prize winner, "appreciate that many 
of those civilizations share a sharp curve of decline. Indeed, a society's 
demise may begin only a decade or two after it reaches its peak population, 
wealth and power." He then goes on to draw parallels between America today 
and many powerful nation-states throughout history.

Ice age? New Asia? Or born-again America?

What is most striking is that both of these scientists predict a sudden, 
rapid decline following a peak of power, population and wealth, a theme 
reminiscent of an observation made by Kevin Phillips, Nixon strategist, 
political historian and author of Wealth & Democracy: "Most great nations, 
at the peak of their economic power, become arrogant and wage great world 
wars at great cost, wasting vast resources, taking on huge debt, and 
ultimately burning themselves out."

If the Singularity is triggered, possibly as early as 2005 as the scientists 
predict, what should you do? Would it be wise for you to jump back on the 
tech bandwagon now?

Maybe and maybe not. All that we know for certain is that absolutely nothing 
is certain nor predictable in the Singularity because 20,000 years of 
accelerating technological, sociological and economic progress is compressed 
into a short span of time.

In this scenario, we could collapse into a black hole and end up in a 
parallel universe. We could collapse into a new ice age. The Singularity 
could also trigger what scientists call a paradigm shift with a totally new 
Matrix reality emerging.

Tech funds for an unpredictable "Singularity"

Maybe it will be as simple as the fulfillment of John Naisbitt's megatrend 
prediction that the 21st century belongs to Asia, as the center of world 
power shifts. Or maybe we'll see a transformation and a born-again America 
... but whatever happens, you cannot predict what will be on the other side 
of the Singularity, it'll just be one big exciting trip into the unknown!

So should you be back in tech funds? You bet. If the worse case scenario 
happens, what have you got to lose, you'll be rocketed into a parallel 
universe without your money anyway! And if the best case scenario triggers, 
well then, you just might win big-time with America's technology geniuses 
(this time around).

So here's a few old favorites (most of which lost big-time in the past three 
years but have longer-term records worth a second look): Fidelity Select 
Electronics (FSELX: news, chart, profile); Fidelity Select Software (FSCSX: 
news, chart, profile); T. Rowe Price Science & Technology (PRSCX: news, 
chart, profile); Amerindo Technology (ATCHX: news, chart, profile); RS 
Information Age (RSIFX: news, chart, profile); and Invesco Technology 
(FTCHX: news, chart, profile).

But please, even if you are convinced that you can time the coming 
Singularity so that you'll get out before the implosion and not get 
snookered like you did when the 1990s bubble, stick to your asset allocation 
rules and don't gamble more than 5 percent of your portfolio on technology 
like so many investors did back then.

Help STOP SPAM with the new MSN 8 and get 2 months FREE*  

Rate This Message: http://www.cryonet.org/cgi-bin/rate.cgi?msg=21825