Weekly Bot Brief 5-28-02021

                 "There is no force on earth more powerful than an idea whose time has come."     Victor Hugo

Bots in The News:

All it takes is a wee bit of economic optimism to set the bots that comprise the Bot Index into  positive trajectory. Buoyed by many of the Asian companies, the Index gained almost three percent while the S & P 500 rose 1.16%. The bot gain marks the second consecutive week that the Bot Index exceeded the broader index. Five of the six Asian companies were among the best performers for the week, having returns in excess of 3 ½% each.

The best performance number was recorded by the Chinese EV firm, NIO Ltd. whose fortunes rose by 13.39%. NIO was joined by a number of Asian counterparts that included, Yaskawa Electric (+5.56%), Hiwin Technologies (+4.84%), Fanuc Corp. (+3.86%) and finally, OMRON Corp. (+3.77%).

Brooks Automation’s 7.45% increase was attributed to a couple of articles that appeared in Investor’s Business Daily. The first article entitled, ‘Industrial Automation, Robotics Market Is 'In Full Swing' Post-Covid’ helped to push the stock from $95 to $102.

NVDIA Corp. rose 8.36%, Tesla (benefitting from the extraordinary move in NIO Ltd.) gained 7.63% and the lower priced Immersion Corp. and 3D Systems each appreciated to the tune of 6.88% and 8.36% respectively.

Notable among the losers for the week were the two major defense manufacturers, Lockheed Martin who fell 1.29% and Northrup Grumman who declined 1.24%.

The worst performer for the week was Accuray Inc. whose fortunes fell by just under 7%. Apparently, last quarter’s earnings, while decent, were insufficient to garner much investor enthusiasm to justify the rich 85x P/E multiple. The stock is down 13% from the latest earnings report.

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Robotics and Ethics:

A major topic of the increasing application of various robotic automation is how robots will interact safely with humans. Since the virtual advent of the robotic industry, the ‘sanctity’ of humans was incorporated in every robot’s capabilities. However, with the advent of Artificial Intelligence’s integration with the physical capabilities of robots, the independence of automated machines has become more in question.

Recently, it has been reported that there has been a fatal and autonomous drone attack in Libya. A Turkish military drone hunted a human target in Libya last year without being ordered to do so. "The lethal autonomous weapons systems were programmed to attack targets without requiring data connectivity between the operator and the munition: in effect, a true ‘fire, forget and find’ capability" – suggesting the drones attacked on their own.

Zak Kallenborn, at the National Consortium for the Study of Terrorism and Responses to Terrorism in Maryland, said this could be the first time that drones have autonomously attacked humans and raised the alarm.

While this is an actual reported attack by a free-decision robot on a human being, it is likely not to be the last. In fact, in 2018, the United Nations sought to ban ‘killer’ robots for use in warfare but the initiative was stifled in debate. The future for nefarious use of these advanced technologies to create mischief will unlikely continue. Even though most nations have banned the use of chemical/gas warfare, the world has changed and the rules of nations will likely be circumvented by terrorist cells that can have ready access to advanced technologies of mayhem. This will become a problem that will be difficult to overcome, however, since the Pandora’s box has been opened, stringent rules must be developed and rigid enforcement enacted.

Member: American Economic Association, Society of Professional Journalists, United States Press Association. Institute of Chartered Financial Analysts, Robotic Industries Association, Member IEEE.

The Bot Brief is a weekly newsletter designed for economists, investment specialists, journalists, and academicians. It receives no remuneration from any companies that may from time to time be featured in the brief and its commentaries, analysis, opinions, and research represent the subjective views of Balcones Investment Research, LLC. Due to the complex and rapidly changing nature of the subject matter, the company makes no assurances as to the absolute accuracy of material presented.