Invest Like a Tesla

Money For the Rest of Us

J. David Stein

Investing, Investing Podcast, Business, Economics, Economy

4.5 • 1.4K Ratings

🗓️ 21 August 2019

⏱️ 26 minutes

🔗️ Recording | iTunes | RSS

🧾️ Download transcript

Summary

How the composition of Tesla's autopilot software gives clues to how we should invest, recognizing there are no perfect algorithms for driving or investing.

In this episode you will learn:

Why Americans are afraid of self-driving cars.
How autonomous automobile software works.
Why people reject even the best possible algorithms.
What are examples of safety features and rules of thumb we should build into our investing process.
Why does everyone think a recession is coming soon even though there is little evidence currently.

Thanks to WIX and Dashlane for sponsoring the episode.

For show notes and more information on this episode click here.

[0:17] The pervading fear of self-driving cars, despite their safety features.
[3:33] Why do people fear algorithms and prefer human decision-making?
[7:45] Algorithmic decision-making has proven to be most accurate.
[10:10] Automating your investing is like choosing an automated vehicle.
[12:06] Keeping within the guardrails of investing strategy.
[15:44] How to diversify your portfolio as an additional guardrail.
[17:31] Is a recession really looming on the horizon?
[20:16] Don’t maximize for perfect answers.

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Transcript

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0:00.0	Welcome to Money for the rest of us. This is a personal finance show on money. How it works, how to invest it and how to live without worrying about it.
0:09.0	I'm your host David Stein. Today is episode 265. It's titled Invest Like a Tesla.
0:17.0	A few weeks ago I test drove a Tesla Model 3.
0:21.0	I was in San Diego, weaked out on the highway and we turned on autopilot.
0:27.0	I was a little freaked out.
0:31.0	I've had a car that has had adaptive cruise control. I was
0:36.1	cunted with that but the idea of the car changing lanes, letting go to the
0:40.4	steering wheel to allow it to change lanes, I think you like to go to the steering
0:44.3	well, at least you held onto it and it drove for you. But didn't completely drive for you, and so
0:51.5	it was sort of how much control should I give this
0:54.8	car. The Brookings Institute did a survey last year and found that only 21% of
1:00.3	adult internet users said they are inclined to use a self-driving car.
1:05.0	61% said they would never do it.
1:08.0	The American Automobile Association,
1:10.0	survey this is from this past March,
1:12.0	said 71% of those that responded feared autonomous vehicles.
1:18.0	Greg Branen, who's the AAA's Director of Automotive Engineering,
1:22.0	said, it's possible that the sustained level of fear is rooted
1:25.6	in a heightened focus, whether good or bad on incidents involving these type of vehicles.
1:32.2	Self-driving cars, when we've been down in Phoenix of cars being tested. The National Highway Transportation Safety Association
1:45.3	says 94% of accidents are from human air. Now that seems low to me because there aren't that many self-driving cars on the road.
1:56.0	Cars typically don't just take off in terms of their acceleration.
	...

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