October 8 marked a significant moment for Geoffrey Hinton, who, along with John Hopfield, was awarded the Nobel Prize in Physics.

Hinton earned this prestigious accolade for his pivotal contributions to machine learning through artificial neural networks. This groundbreaking work has earned him recognition as the “Godfather of AI.”

Put simply, Hinton’s innovations form the backbone of modern AI functionality.

However, much like Alfred Nobel, who lamented the destructive use of his invention, dynamite, Hinton feels a mixture of pride and regret about his achievements.

Since May 2023, he has been vocal about the threats posed by rapidly advancing technology. To speak more candidly about his concerns, he even resigned from Alphabet Inc. (GOOG).

When recently asked about AI’s impact on society, he stated:

“It will be comparable with the industrial revolution. But instead of exceeding people in physical strength, it’s going to exceed people in intellectual ability. We have no experience of what it’s like to have things smarter than us.”

This brings me to my main point: we stand on the brink of a major transformation driven by the AI Boom.

Let’s explore what this means…

A Major Transformation in America

If you think the pace of change is rapid now, prepare for even more upheaval.

The core of this shift lies in technology. Our everyday lives, from the way we work to how we interact in our homes, are undergoing profound changes due to increasing automation.

Historically, whenever a revolutionary technology enhances our lives by making tasks cheaper and more efficient, it garners swift adoption, regardless of resistance.

With AI, we can soon expect innovations such as Robotaxis and tailored treatment plans for significant health issues, fundamentally altering our work and leisure activities.

However, this revolution is not without its downsides…

A few weeks ago, I discussed the dockworkers’ strike, which aimed to halt further automation at ports. I believed this push was fruitless, as AI-driven solutions were inevitable.

Yet, dockworkers aren’t the only ones facing challenges. Tech workers are finding themselves at risk as well.

According to TechCrunch, major companies like Amazon.com, Apple, Inc., Alphabet, Meta, and Microsoft have collectively laid off around 94,400 employees in 2023 alone.

Overall, tech layoffs this year total approximately 141,076 employees!

While some layoffs result from employees hesitating to return to the office, a significant number stem from companies increasingly relying on AI to streamline their operations.

This trend is just the tip of the iceberg. Professions in law enforcement, customer service, medicine, transportation, and beyond will also see job reductions.

According to a McKinsey study, up to 800 million workers worldwide could face job losses by 2030. A report from Wired estimates that 70% of existing jobs may experience wage cuts.

These statistics highlight a monumental shift in both the economy and society.

This change will accelerate with the arrival of what can be termed the “Real AI Boom.”

Getting Ready for the Real AI Boom

At present, many investors are focusing on the “first generation” of AI stocks, such as NVIDIA Corporation (NVDA). While NVIDIA may still be a profitable option, it has become somewhat outdated.

In contrast, the true profit potential lies in the “second generation” of AI stocks. These are companies that are employing generative AI to create new, profitable business models, revolutionizing existing industries in the process.

Those who adapt to this forthcoming surge in AI technology are poised for remarkable success, while others may struggle to survive — some could even go bankrupt.

In essence, we may witness a significant reshaping of the stock market, creating distinct winners and losers. As beneficial as AI may be, it will inevitably lead to the decline of many outdated businesses.

The Real AI Boom will usher in new market leaders, resulting in the creation of millionaires and possibly billionaires. Conversely, countless stocks may fade into obscurity.

This transition is already in motion and gaining momentum.

By utilizing my Stock Grader, I’ve pinpointed six innovative AI companies likely to excel during the Real AI Boom. Surprisingly, these firms aren’t the ones you might expect. One is an insurance company leveraging AI to enhance underwriting, while another is reimagining travel with AI technology. Both have shown strong performance this year, and as the Real AI Boom accelerates, their success should continue.

To discover how you can capitalize on the Real AI Boom and access my six AI recommendations, watch my special briefing here.

Act quickly, as this briefing is only available for a limited time.

Sincerely,

Source: InvestorPlace unless otherwise noted

Louis Navellier

Editor, Market 360

The Editor discloses that, as of the date of this email, he owns securities related to the subjects of this commentary and analysis:

NVIDIA Corporation (NVDA)