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CHAPTER 4Artificial Intelligence

Let's get one thing out of the way quickly: This chapter will NOT be about fictional artificial intelligence (AI) systems gone rogue. There's no Skynet here. What it will be about is how this technology is going to change financial institutions and services as we know it soon. This promise that artificial intelligence will change everything has been made many times, but we are very close now. One reason for the recent boom in artificial intelligence applications is the amount of data that are available. This thinking is kind of counterintuitive, right? Most people think that artificial intelligence is being driven by Moore's law, which originally stated that the processing power of computers would double every year, and as of 2015, Intel a leading maker of processors, has stated that the cadence is closer to two and half years. However, the real driver of the AI revolution is the amount of data now available. To understand why the data revolution is driving the AI boom, it is necessary to understand a bit of how AI works under the covers.

Computers Will Be Trainable

I was in an airport and I bought a Wired magazine to read on the plane. It contained an article titled “Soon We Won't Program Computers. We'll Train Them Like Dogs.”¹ As I read the article, I pondered what that really means from a financial institution's perspective.

If you're doing any research at all on artificial intelligence, you'll see that the concept of training is a recurring ...