• The media, as expected, doesn’t understand Tesla’s Cybertruck
  • Amazon’s AI: Coming to a grocery store near you
  • Quantum computers are powerful, but how do we know they’re accurate?

Dear Reader,

As we enter the holiday season, we certainly have a lot to be thankful for. It has been one exciting year in the world of technology, and the U.S. economy continues to deliver. We can see it in the equity markets as well. The broad indexes are at record highs, and the New York Stock Exchange is up an impressive 19% this year.

Given the health of the economy and the record low unemployment levels in the U.S., I reckon we’re in for record retail sales over the U.S. Thanksgiving holiday weekend – the crazy Black Friday and Cyber Monday sales.

The latest back-and-forth between the U.S. and China on trade negotiations still suggests that we’ll see the first iteration of a trade deal in place before the end of the year. China’s economic numbers continue to weaken, and the U.S. continues its strength, which supports a trade deal getting done sooner rather than later.

Even though the initial deal might be limited in scope, it will still be seen as bullish by the market. For subscribers to my investment research publications, keep an eye out for alerts. I’m planning on selling some positions into market strength. A little “bonus” for the holidays…

Now let’s turn to our insights…

The Cybertruck is a vision of the future…

We have to talk about the Cybertruck that Tesla just released. This thing looks like it is out of a science fiction movie. And as with everything Tesla does, it has been very polarizing. People either love it or think it is atrocious.

The New Tesla Cybertruck

Source: Tesla

First, this is a real pickup truck. When we compare it to the Ford F-150, the most successful truck in the U.S., it measures up in every way.

The F-150 is 232 inches long with a six-and-a-half-foot bed. It can tow 13,200 pounds. Tesla’s largest Cybertruck model is 250 inches long with a six-and-a-half-foot bed. And it can pull 14,000 pounds.

On top of that, the high-end Cybertruck can go from zero to 60 miles per hour in 2.9 seconds. That matches the fastest Porsche out there. Plus, it’s bulletproof, and the windows are armored.

As a brief aside, the mainstream media fixated on the fact that the truck’s windows broke when a metal ball was thrown at it. What media outlets usually fail to mention is that the windows were damaged when a sledgehammer struck the door in a prior test. This is something that Tesla can fix as it begins production.

The media also forgot to mention that the glass survived an impact from the same metal ball from 15 feet without shattering. Would any of us be comfortable dropping a heavy metal ball on our windshields from 15 feet or using a sledgehammer on the door? No way… The Tesla Cybertruck is impressive.

So the Cybertruck has more capacity and more towing power than the F-150. And it drives like a sports car. Pretty unbelievable.

And it’s electric. That means it has more torque and will be easier to maintain. That’s because electric vehicles have far fewer moving parts than cars with internal combustion engines. Tesla even demonstrated the Cybertruck’s power by conducting a “tug of war” with a Ford F150.

Cybertruck Versus the Ford F-150

Source: Twitter (@elonmusk)

Now, here’s what people are missing about the Cybertruck… The design is simple and elegant. There aren’t many curves on the frame. Everything is flat and angular. That makes it much cheaper to manufacture. And, of course, that means higher gross margins for Tesla.

And it doesn’t look like Tesla will have to wait long for those margins…

News is out that the company has already received 250,000 early reservations for Cybertruck. And each order requires a $100 deposit. Yet the vehicle won’t go into production until late 2021.

So the Cybertruck is truly a vision of the future. It’s a sign that our cars are going to start looking dramatically different than we’re used to today.

To be sure, radical ideas like this are always met with skepticism at first. But what I see is a high-performance product that is simple and cost effective. The Cybertruck is going to be a profitable vehicle for Tesla. And as with all things that Tesla does, it will redefine an entire category.

As longtime readers know, I’m very bullish on Tesla’s future. Here’s a company that was hated by most investors and the mainstream financial press. But rest assured, Tesla’s best days are still ahead of it.

And the best part is that there will be further improvements to the truck between now and production in late 2021.

As for me… I’m going to get on the list and put my deposit down on the future.

Supersized Amazon Go stores are coming…

We have talked about Amazon Go stores before. As a reminder, these are the next generation of convenience stores. Artificial intelligence (AI) and computer vision (CV) power these stores, which allows them to be cashierless.

When consumers walk into the store, they scan a barcode on their phone’s Amazon Go app. This links their activity with their Amazon account. From there, cameras use computer vision to identify exactly what each consumer takes off the shelf. Then, when consumers exit the store, their Amazon account is charged for the items they took.

It’s an amazing experience. There are now 21 Go stores around the country. I visited the one in Manhattan just days after it first opened.

And Amazon has big plans for Go in 2020. News is out that it has designed technology to support 30,000 square foot stores. For context, that’s about the size of a traditional small grocery store. And it’s compared to the roughly 2,000 square feet of storage space the first Go stores have now… more than 10 times larger.

What’s more, Amazon indicated that it is willing to license its technology to other supermarkets. This is interesting…

I am estimating here, but it costs several million dollars to outfit a 30,000-foot store with AI and CV. Not many supermarkets can afford to do that at scale… Most of them run their businesses at razor-thin margins.

But Amazon is sitting on $43 billion in cash. And it will generate nearly $26 billion in free cash flow this year. Not to mention that it owns Whole Foods now, which means that it has fantastic purchasing power. That makes Amazon the perfect company to set up next-generation retail stores.

So why would Amazon license its tech to other companies when it has such a big competitive advantage?

Well, I think Amazon is pulling a “Google” here. It is farming for data. If its technology powers other supermarkets and potentially retail outlets, Amazon will know what people buy and where they buy it every single day.

But unlike Google, I don’t believe Amazon wants to sell this data. As my readers know, I personally disagree with Google’s (and Facebook’s) business model of selling user data – without our consent, of course.

Instead, I believe Amazon will use this consumer data to make its services even more convenient and seamless to everyday consumers. We’ll get to the stage where Amazon will simply deliver products to our home precisely when we need them. It will know our buying habits and daily requirements better than we know them ourselves.

So don’t be surprised if you walk into your grocery store next year and the cashiers are gone. The tech is already here but just not widely distributed yet. But it’s just a matter of time…

The new quantum computer test…

Glenn Beck had me on his show last week to talk tech, and he asked a fantastic question when we got on the subject of quantum computing. How do we know if a quantum computer’s answer is right?

(By the way, readers can catch my discussion with Glenn Beck right here.)

This is a great question because quantum computers will be used to solve ridiculously complex problems. We already know that a quantum computer can solve a problem in seconds that would take the world’s fastest supercomputer 10,000 years to solve.

But since we can’t possibly know the answer to these complex questions, how can we trust the quantum computer’s answer? One of the current challenges with quantum computers in the “noise” in the systems, referring to things that can affect the hardware like fluctuations in temperature or stray magnetic fields.

Quantum computers with too much noise result in incorrect answers. Those with low noise produce very accurate answers. Of course, every year that passes results in improvements, but we need to understand whether the accuracy should be in question.

Well, researchers at the University of Warwick have a solution. They designed a test to “check” the quantum computer for accuracy.

They do this by giving the computer a set of problems that we already know the answers to. Then they measure how close the quantum computer’s answer is to the right answer. And we are talking about very specific calculations with many decimal places.

Here’s an easy way to think of it. We might use a diagnostic scanner to check that all the systems in our car are functioning as they should. Well, think of this as a quantum diagnostic check.

I expect we will use tests like this each time before we ask a quantum computer to tackle a major problem. That way, we can confirm that the quantum computer if functioning properly and accurately before we put it to work.


Jeff Brown
Editor, The Bleeding Edge

P.S. Quantum computing isn’t the only bleeding-edge technology that’s setting the world on fire right now. Regular readers know that I have been pounding the table on CRISPR genetic editing technology for years now… And it is finally proving itself in clinical trials.

As I have said many times, CRISPR is going to cure all human disease of genetic origin. And soon. The end of disease isn’t 100 years away. It may not even be 10 years away.

And early investors in the companies driving this great work stand to make a fortune.

We’ve already seen early signs that sickle cell disease and beta thalassemia can be cured with CRISPR. We’ve “cracked the biology” of those diseases, as the CEO behind the therapy put it. Incredible.

But that achievement pales in comparison to what’s going to be cured next. If my intel is right, the next CRISPR cure is going to astonish people. It is going to be all over the news. And I’ll bet the first patient cured will be on 60 Minutes right after the story breaks. That’s how big this is.

And my “boots on the ground” research tells me we are weeks away from this happening. This will be the biggest story of the year. When this cure hits the news, the small-cap CRISPR company behind it is going to go viral. And its stock price is going to explode.

That’s why I want all readers of The Bleeding Edge to get exposure to this small-cap company immediately. I would not be surprised at all if this stock soared 1,000% in a matter of days.

Simply put, this company needs to be in every small-cap tech investor’s portfolio. We’re staring down a once-in-a-lifetime opportunity with this one. I don’t think I’ve been this excited about something in a long time.

Just go here to get all the details.

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