Hi, Jeff Brown, here. Welcome to AMA Day at The Bleeding Edge…
But before we get into some of your questions and comments, I just want to say what a thrill it is to be back.
In case you missed the exciting news, I’ve returned to Brownstone Research. Only, things will be a little different this time around. For the inside scoop, you can catch my big announcement video below…
The outpouring of feedback and excitement from you all over the past couple of weeks since my team and I returned to Brownstone Research has been incredible. A big thanks to all of you. We’re excited to be back at it.
One of the biggest questions we’ve had rolling in has been from former subscribers to our paid-up advisories seeking to reinstate their subscriptions.
My managing director, Lindsey, and I have worked out a solution. We put it on your radar in last week’s Bleeding Edge AMA…
If you were a former paying subscriber at Brownstone Research but canceled your memberships and subscriptions and would like to have your subscriptions reinstated, we have a full customer service team ready to help you do that. You may contact them at [email protected]. Or call 888-493-3156.
Our team is receiving a lot of calls and emails, so we appreciate your patience. If your desire is to be reinstated, we will do our best to make that happen.
And, of course, if you run into any trouble along the way, we want to hear about it so we can correct it. Each day, our team collects all the emails we receive. We read each and every one.
I don’t want you to miss out on any of the exciting research, insights, and updates we’ve got coming up. So please make sure you reach out to our dedicated customer service team about reinstating your memberships.
You’ve all been writing and calling in with your comments, questions, and concerns. It’s been quite lively in the Brownstone offices. I’m reading, researching, and writing responses as fast as I can… and I’ll address a range of good ones in today’s Q&A.
Thanks again to all of you who have been writing in and reading Brownstone research. I can’t say enough how thrilled we are to be writing to you once again.
Have a great weekend.
Regards,
Jeff
The Matter of Tesla Safety
Jeff, I am a Lifetime member, and I could not be happier with how things have turned out in your situation. You have earned the full trust of all of your followers with the high-tech info and perspectives you provide. I would love to see your comments on a very simple issue for you and your staff, car safety. Since Elon Musk bought Twitter and revealed the extreme bias in their censoring of their users, he has become an enemy of the far left, and the media constantly tries to tell us how unsafe Tesla cars are. They try to scare us about accident and fire rates, and while many of your followers know better, it would go a long way toward removing these fears if you would provide trustworthy info on these safety issues. It should be simple for you to show current and near-term accident and fire rate data on gasoline, hybrid, and Tesla electric cars. It would provide your followers solid, real info to convince our neighbors. Thank you.
– Paul O.
Hi Paul,
This is an interesting topic, and you’re right… much of the media has made efforts to be critical of Tesla over the years.
The White House even claims that General Motors led the EV revolution. Not only was Tesla first in EV sales in the U.S., it sells more EVs than every other EV manufacturer combined.
And ironically, the Tesla Model Y is the most American-made car of all cars, followed by the Model 3, Model X, and Model S.
As for safety, we’ll need to consider that from two angles. There is the overall safety of the vehicle as determined by the National Highway Traffic Safety Administration (NHTSA). And then there is the safety of the vehicle when it is on Autopilot or Full Self-driving (FSD) mode.
The Tesla Model 3 received perfect 5-star ratings from the NHTSA in every category and sub-category. And it has the lowest probability of injury of any car the NHTSA has ever tested. The Model S, Model X, and since the chart below was produced, the Model Y are all rated the very best in safety.
Source: Tesla, NHTSA
An easy resource to see the safety ratings on any Tesla – or any other car for that matter – can be found here on the NHTSA website. It’s super easy to use. Just type in the year, make, and model and you’ll have the safety ratings.
We see nothing but 5-star ratings for Teslas.
Source: NHTSA
With that said, the safety question gets even more interesting when we consider the use of Tesla’s Autopilot technology. The numbers are absolutely incredible.
Source: Tesla
Above we can see a snapshot of the last five published quarters of safety data regarding miles driven per accident. It varies a little bit quarter by quarter, but two things stand out.
First, when Teslas are on Autopilot, they are remarkably safer than cars being driven by humans. In Q1 2024, there was only one accident per about 7.6 million miles driven. For Teslas not using Autopilot, there was one accident every 950,000 miles driven. And the U.S. average is about one accident every 500,000 miles.
So Teslas are about twice as safe as the U.S. average in general and about 15 times safer than the U.S. average when on Autopilot.
The data is remarkable. And I stand by my prediction that it will get even more compelling when Tesla fully commercializes its full self-driving technology to the point where it no longer requires the driver to tug on the wheel every few minutes (the steering wheel “nag”).
And one final point on safety related to car fires. This has been a major area where Tesla/Musk haters have tried to create fear. Again, the numbers are telling…
Source: Tesla
The 2023 numbers aren’t out yet, but they’ll look very similar to 2022.
In short, there was only one fire event for every 130 million or so miles driven in Teslas. That compares to one fire event every 18 million miles driven as the U.S. average as determined by the U.S. Department of Transportation and the National Fire Protection Association.
If those numbers weren’t compelling enough, Tesla’s data includes any fires that were caused by a structure fire (e.g. a house/garage is on fire), wildfires, arson, and any fires unrelated to the Tesla. And the data from the National Fire Protection Association excludes any fires related to a structure. This is to say that the Tesla fire statistics are even better than what we see above.
I hope this information is useful.
The Future of Our Dollar/Economy
Hi Jeff, your subscribers are happy to have you back at the helm, welcome. Would you please give us your opinion on the recent agreement lapsed of the Petrodollar and the future of our dollar/economy? Does this mean we can expect inflation up ahead? Are gold and BitCoin a hedge against inflation and if yes, are you able to recommend trustworthy companies we may purchase these commodities from? As always your assessment of this situation is greatly appreciated.
– Jeff I.
Hi Jeff,
I’m glad you brought this up, as this became an interesting “story” on social media and the internet. It’s also a multifaceted topic that has dimensions that most haven’t considered. But before we get to that, let’s clear up a misunderstanding.
The agreement that you’re referring to is the United States-Saudi Arabian Joint Commission on Economic Cooperation which was signed in 1974.
This wasn’t actually a Petrodollar agreement. In fact, there never was an explicit Petrodollar agreement.
Back then, the agreement was centered around economic cooperation and the stable supply of petroleum to the U.S.
Saudi Arabia naturally had a massive surplus of U.S. dollars from selling oil, and the U.S. wanted to have those dollars back in the U.S. economy through the purchase of U.S. Treasuries.
Even after the agreement was signed Saudi Arabia continued to sell oil in other currencies. Other than the U.S. dollar, the British pound was the most common.
But over time, the dollar dominated as the primary currency for the purchase of oil due to the nature of the strength of the U.S. economy and its currency (relative to all other currencies).
With that said, things have started to change…
The U.S., with the complicity of NATO, provoked the war with Russia in the Ukraine and blew up the Nord Stream 1 and 2 pipelines in an effort to cripple Russia’s economy. It didn’t work.
Not only has Russia’s economy not suffered, it has thrived.
Russia has now overtaken Japan as the fourth-largest economy in the world. And a few months ago, the International Monetary Fund projected that Russia’s economy would grow faster than all advanced economies.
The reality is that Russia was able to sell its own natural resources to other countries, and those transactions naturally took place in other currencies.
The U.S. foreign policy to war with Russia through its proxy Ukraine has now resulted in about 20% of global oil being bought and sold in currencies other than the U.S. dollar. This isn’t about an agreement lapsing, it is the direct result of current U.S. foreign policy.
And the BRICS countries – that’s Brazil, Russia, India, China, South Africa, Iran, Egypt, Ethiopia, and the United Arab Emirates – in addition to Saudi Arabia have been making moves to increase their trade in non-U.S. currencies.
Naturally, this is disadvantageous to the U.S. If countries decrease their use of trade in U.S. dollars. They will have less U.S. currency to funnel back into U.S. Treasuries to support the ridiculous levels of U.S. deficit spending.
In the worst-case scenario, Treasuries will collapse, and the Federal Reserve will be forced to print trillions more, greatly weakening the U.S. dollar.
And yes, gold and bitcoin are good hedges against the destructive monetary and fiscal policy that we are experiencing right now.
So are other hard assets like timberland and other forms of real estate. This is especially true if we can purchase land with cheap debt and long-term fixed-interest-rate loans. That way, we’re paying it back with devalued dollars as the income generated from the land increases with inflation.
Graphene Semiconductor Technology
Surely, you are aware of the advances in graphene semiconductor technology. It is claimed that graphene is a notably more efficient conductor of electronic signals than silicon. Perhaps, then, that material could go a long way toward solving the electrical consumption issues that you are discussing.
– Edwin P.
Hello Edwin,
Yes, graphene is always a fun topic with incredible promise.
What’s not to like about a material that is 200 times stronger than a comparable sheet of steel? And graphene is a superconducting material capable of withstanding heat up to 1,300 degrees Fahrenheit.
It’s an amazing material made of a single layer of carbon atoms bound together in a hexagonal shape as seen below in the microscopic image.
Source: Berkeley Lab
It is a wonder material that can be used for semiconductors and a wide range of other applications that would benefit from its properties.
But there is one major problem…
It is ridiculously expensive to manufacture and requires a lot of energy to do so.
Graphene can cost as much as $200,000 per ton. The industry is, of course, working towards a breakthrough that could radically reduce the costs of producing graphene. But until that happens, it is very difficult to scale production for commercial manufacturing.
I pay close attention to the materials science industry as any breakthroughs directly impact a wide range of industries, and there are of course investment implications.
We’ll absolutely be following any developments with graphene in The Bleeding Edge and my other investment research publications.
Neural Net Profits
I am very excited about your return. I hope you are successful in restarting your prior research. Specifically in renewing the neural net profits for us. The rebranding theft committed by those in charge during your absence was inexcusable and I hope you are able to right that wrong. Appreciate you and your team.
– Jeff H.
Hi Jeff,
I definitely share your sentiment and thank you for your feedback.
For everyone’s benefit, Neural Net Profits was an investment research product powered by the advanced artificial intelligence that one of my team members and I spent years developing, called The Perceptron. I wrote about it in last week’s Bleeding Edge – Brownstone: Back and Better than Ever.
It was designed to take advantage of massive amounts of real-time trading data on digital assets to find patterns that result in high-probability trades.
Neural Net Profits was shut down in my absence and rebranded over at Palm Beach. The Perceptron became known as CONAN. This was disappointing to me, though I was happy that the technology and system were still in use.
The Perceptron performed well in the bear market of 2022 and early 2023 with the following returns for Neural Net Profits:
-
Win rate: 79%
-
Average return: 20.3%
-
Average hold period: 94.2 days
-
Total return of product: 223.9% (annualized)
The holding times were longer than what we had modeled, but that was the result of the bear market conditions. The product grossly outperformed bitcoin, which we used as a benchmark, which was down 40.5% over the same period.
And in the bull market of the last 12 months, the Perceptron (the AI that we designed for Neural Net Profits) returned nothing but winners as CONAN.
-
Win rate: 100%
-
Average return: 32.3%
-
Average hold period: 37.13 days
-
Total return of product: 119.1% (annualized)
This is, of course, what we had expected, but the accuracy in a healthy market has been incredible. And the average holding period dropped significantly to about 37 days, which is what we modeled for.
My team and I are currently working on some additional research and looking to bring the Perceptron back to life again. It’s even smarter than before after so much real-world training.
Republic Note?
Dear Jeff Brown, based on your recommendations, I invested in Republic Notes and also invested in Skybound through Republic. I could be wrong, but I don’t think there has been any guidance or direction concerning these investments since you departed from Brownstone. Now, if I am calculating correctly, the market has discounted my Republic Notes so they are worth 58% of what I paid for them. Also, I have no idea how or when I might see a return on my Skybound investment. Please provide us with an update, now that you are back.
– Scott E.
Hi Scott,
There have been a lot of developments around the Republic NOTE in the last year, the biggest being that the NOTE listed on a digital asset exchange this January.
When I first recommended the NOTE, it was at $0.12. And this January, it traded at $0.38 – representing a more than three times gain.
Had I been at Brownstone, I definitely would have recommended at least taking the initial investment off the table… But there is also nothing wrong with holding on given the quality of the assets that back the NOTE.
This March, I wrote an update on the Republic NOTE in Outer Limits – What’s Happening with the Republic NOTE? This will give you a complete picture. And you can track developments on the NOTE at the Republic NOTE website.
As for Skybound, I also provided an update this March in Outer Limits – An Update on Skybound.
The company is doing fantastic. It is still a private company and continuing on its growth journey. And, as with all private investments, liquidity typically comes when there is either an IPO or an acquisition. So we’ll enjoy the ride and progress as Skybound grows and wait for one of those two likely outcomes.
When companies go public, we typically receive shares of the private company that we’ve invested in. Most shares are typically locked up for six months after the IPO, after which they can become tradeable.
In the event that a private company is acquired, one of three things can happen…
-
There can be a cash payout for your shares.
-
You can receive shares in the acquiring company if it is private. In that case, we’d wait for that company to have an exit.
-
You can receive shares in the acquiring company if it is public. It usually takes several weeks for the share conversion to take place and for the publicly traded shares to arrive in your brokerage account. But when they do, you can sell them if desired.
But rest assured, my team and I are once again closely monitoring their progress and will keep you updated.
How is Jeff Doing?
Hi Jeff, how are you doing? How is your health? Hope your kids are doing well. Really motivated to see you back. Completely felt out of touch with technology when you were out last year. I clearly remember you writing about the development of OpenAI and AGI for quite a long time even before this AI hype manifested. Hats off for your previsions. Hoping to see recommendations of mid-cap and small-cap companies from tech, biotech, etc., which are beaten down and have great long-term moat. I definitely don’t want to miss the next growth cycle in these companies. Thanks for putting up a fight to come back for all of us.
– Lakshmi K.
Hi Lakshmi,
I’m doing great. I’m very happy and energized to be connected again with my subscribers. Thank you.
I’m still on my journey battling my cancer, but I feel like I’m making progress. I actually feel fantastic. My energy levels have never been higher, and my focus and flow have been incredible.
I attribute this to my consistent and rigorous training regime, my extremely healthy diet, fine-tuned supplements, and other functional health practices.
Seneca said, “The body should be treated rigorously, that it may not be disobedient to the mind.”
I have found the wisdom in these words and apply them with purpose. I am empowered and improved as a result.
In the short term, you’ll be able to find my investment research on small capitalization stocks in Exponential Tech Investor. And in the coming months, I’ll be excited to share news on new investment research that I’m planning to announce and bring back to life.
My team and I will keep fighting, we’re on a mission, and we have a lot to look forward to.
Thanks again,
Jeff