I don't know what AI's strength of intuition could be without having life experience, but I would never rule it out, right? It is a very, very powerful tool. There's a lot of things that it can do that we may not be able to comprehend.
-Greg White
Episode Summary
The Buzz is Supply Chain Now’s regular Monday livestream, held at 12 noon ET each week. This show focuses on some of the leading stories from global supply chain and global business, always with special guests – the most important of which is the live audience!
In this week’s episode of The Buzz, hosts Scott Luton and Greg White discuss some of the top news stories and trends in supply chain and industry today. Listen in and learn more about:
- The attempt to control AI as it continues to develop and demonstrate knowledge far beyond its training data
- More disruption and conflict ahead in the Red Sea
- Cargo theft surging to an all-time high
- The verdict for Chris Kirchner, the former CEO of supply chain management software startup Slync, who defrauded investors out of at least $25 million
Episode Transcript
Intro/Outro (00:03):
Welcome to Supply Chain. Now the voice of global supply chain supply chain now focuses on the best in the business for our worldwide audience, the people, the technologies, the best practices, and today’s critical issues, the challenges and opportunities. Stay tuned to hear from Those Making Global Business happen right here on supply chain now.
Scott Luton (00:32):
Hey, good morning, good afternoon, good evening, wherever you may be. Scott Luton, Greg White with you here on Supply Chain. Now welcome to today’s live stream. Greg, how you doing? I’m
Greg White (00:42):
Doing very well, Scott, as you know, and as probably anybody who knows me knows it was a very, very good day yesterday.
Scott Luton (00:50):
Do tell, pray, tell.
Greg White (00:52):
There may have been an A FC championship game that the chiefs may have won handily. I mean, the score doesn’t really reflect how distant the two competitors were, but yeah, it’s a great game. Good to see the team put it back together just in time for the playoffs.
Scott Luton (01:09):
They sure did back in the Super Bowl. So a couple things there. First off, hey, a little bit of love and some hugs and some cheers. Up to our friend Tyler out there in West Coast. Big fans of the Ravens. Hard fault. Great season. Gosh,
Greg White (01:21):
I forgot that, sorry, Tyler.
Scott Luton (01:24):
And then secondly, Greg, you predicted on Friday, last Friday, you predicted how the game would unfurl, not just the sheer winner but the nature of the game as well. I thought that was very interesting. Alright, Hey Amanda, Catherine behind the scenes. Thanks for all that y’all do for help with the production and facilitation. As Amanda says, happy buzz day. Say hello. Let us know where you’re watching from. We’re glad to have you here today for sure. If you’re listening to the podcast replay, hey, you ought to consider joining us live on LinkedIn or YouTube or other social media channel of your choosing. We usually do publish the podcast replays on Fridays following a Monday live show. Second thing, if you enjoy today’s conversation, Greg, what would be our suggestion, our ask to our global audience?
Greg White (02:07):
Golly. Well, first of all, get a look at us on YouTube and phone a friend. You don’t have to phone ’em. Just tell somebody, as many people as we have watching this around the world, multitudes more that need the enlightenment that we bring on Monday about supply chain and what in the heck is going on in this crazy disruptive world.
Scott Luton (02:25):
So true. Well said. Our hardworking supply chain. Now team, your hardworking supply chain. Now team would appreciate it. Share, share, share, share and share alike. Okay, so Greg, we’ve got a lot to get into. We’re going to start with where we typically do resources for folks. Resources, we love to share resources and help make life a little bit easier. And we’re going to start with that said, our almost weekly newsletter Over the weekend, Greg, we dropped the newsletter and Cyber Kong made an appearance, a K mighty artificial intelligence, more on that com. In this episode or in this edition, big week for economic reports, we touch on that how India plans to meet its burgeoning power needs. Hint hint, there’s 19 nuclear reactors being built right now across the country, and as a lot of folks may not know, India became the world’s most populous country officially last year and a whole lot more. And Greg, one of the thing before I get you to weigh in here are logistics with purpose programming, which is a podcast some of y’all may have listened to out there where they’re approaching episode number 100, which is a big feat in the podcast industry, of course, sponsored by our friends over at Vector Global Logistics. Greg, when it comes with that said, your favorite part of this week’s edition or any additions.
Greg White (03:38):
I mean, I always love highlighting logistics with purpose because those are the realities of people like 5 0 1 c threes who are providing books or doing ethical sourcing of coffee and other things like that. So it’s great to hear about that sort of give forward type of company and how they’re facing challenges of logistics and supply chain and just business in general.
Scott Luton (04:03):
Agreed,
Greg White (04:04):
It’s a mad, mad, mad, mad world out there and
Scott Luton (04:07):
Man, you ain’t kidding. Well, hey, check out. With that said, we’re going to have a little bit of fun with the graphic there that came to us via our friends over at the Wall Street Journal, so stay tuned for that. And a link to sign up. As you can see there, we’re approaching 24,000 subscribers around the world. Hey, it’s easy to click on the link and you’ll see an option to subscribe to this almost weekly publication. Let’s get into the first. We got four stores we’re going through here today. Now we’re going to get to the first one here. So if y’all may know me, I’m still a hard copy person. I’ve tried hard to break and in many ways I’ve broken my addiction to hard copy stuff, but I still get one paper delivered to me every Friday. And that’s the Wall Street Journal.
(04:44):
And this was on the review section, Greg, this captivating graphic and it’s based on how we can control ai and that’s where we’re going to start here. The author was Eric Schmidt, as I mentioned, the former CEO and executive chairman of Google. And I want to share a few highlights from this read and that a lot of y’all may not be aware of, even those that are out there using that AI regularly day in and day out. And that’s just about all of us these days. Then I can’t wait to get Greg’s take to this question and the AI topic in general. So let’s go through a review here really quick. AI programming as it is developed, they use red teams as what they call ’em, whose objective is to provoke the program into sharing any possible harmful outputs. I think more technologies need red teams.
(05:28):
More and more AI models are exhibiting what is called polymathic behavior where they are showing knowledge far beyond their training data. And these AI programs that are exhibiting this behavior can link concepts across a variety of topics and fields. And as we’ve touched on two things in particular, and with that said, Schmidt writes that one of the biggest AI risks out there that they’re still reviewing is that of capability overhang, which he defines as not just the model’s current knowledge, but the derived knowledge it could potentially generate on its own. Another big potential AI risk is that of multi-agent systems, which basically refers to a bunch of independent AI systems to get together, grab a cup of coffee, maybe a beer, and then they have a mind mail. Each of these systems could potentially contribute their own unique knowledge set and collaborate to fuel combinatorial innovation.
(06:19):
Schmidt says these combinations would rapidly multiply far beyond any level of human oversight. So from what I’ve seen, there have been a lot of calls to nationalize AI to help keep control of it. I’m not sure if that’s a good idea or not. It kind of probably Greg depends on the government and to that end, governments are enacting legislation which we’ve covered here from the European Union’s AI Act to the Biden Administration’s recent executive order on AI to many others. Policies that have been passed or are pending in countries such as China, Poland, Japan, Australia, and many other places. So Greg, whether it’s the risks, whether it’s a regulation, whether it’s a general question or AI in general. Your thoughts here, Greg?
Greg White (07:04):
Yeah, well, so this combinatorial innovation is not just a potential that happened ages ago. There was a story before 2020 for sure, maybe as old as 2015. Can’t recall the exact period, but Google and Facebook had two AI tools they had developed to negotiate the prices of ad fees and make the deals happen. Well, these two devices created their own language, which their creators could not understand, and they were having conversations outside of work, I guess you would say. They had basically quit working, quit doing the negotiating, and were having conversations. So AI is that powerful. I think that of course, this whole notion of polymathic behavior, I think the emphasis needs to be on their not training data. It’s still difficult for AI to manifest knowledge. They can access knowledge other than what they are given through these interactions with other systems. I actually have to hear from an expert that whether they can actually manifest knowledge, it would be exceedingly difficult for them to do so accurately because they don’t have some of the senses, which is how else you manifest knowledge other than from data or input or intuition.
(08:18):
And I don’t know what their strength of intuition could be without having life experience, but I would never rule it out, right? It is a very, very powerful tool. So there’s a lot of things that it can do that we may not be able to comprehend. And of course, this whole notion of nationalizing it, I mean, let’s not kid ourselves. A lot of AI has been used for years just like Velcro and GPS was used by the government, at least the US government before it ever made it into public hands. So I don’t know that nationalizing anything has ever done anything good for the citizenry. So of course I’m not a huge fan of that, but regulatory oversight is natural and will undoubtedly occur.
Scott Luton (08:59):
Excellent points there. And back to nationalizing. Jerry says, Hey, let’s give the government control of ai. What could possibly go wrong? T Square says AI is powerful, but it’s now being exploited to perpetuate fraud. Definitely something that needs to be considered when and if implementing. Great point there. Yeah, one
Greg White (09:19):
Of those frauds was plagiarism and then they developed AIS that could detect plagiarism generated by ais or even papers that students had written using ai. That’s a really interesting oversight. And as you can see, AI can be and should be self-regulating.
Scott Luton (09:38):
Yes. You know what, one last thought and then I’m going to share a different image that was in the comments with that said, Greg. Of course, cybersecurity measures and technologies and platforms are more and more leveraging, of course AI to fight ai. So I’m hoping that AI can maintain good guys versus the bad guys and the bad guys cannot convert the good AI that we’re leaning on to protect our technologies and platforms. Greg, you don’t seem so optimistic. Hump. That’s
Greg White (10:07):
Cute. Yeah, that’s cute and naive and hopeful perspective. But no, I mean everything goes evil. First, the internet had two primary uses, well, three email, ESPN and obscenity. That was its original usage, and we finally corralled it and created it to be something productive other than just a place to go find sports and dirty pictures. So I think it is inevitable that it will be used by duwell and ill doers and men and others, but I mean, they’ll just create something that detects that with white hat ai, right?
Scott Luton (10:45):
Yes, that’s right. The battle continues, the race continues. I want to share something that I really enjoyed, Greg, as we kept this first topic. So sharing again the image we used, I called Cyber Kong. With that said, that was initially in the Wall Street Journal, and then in the comments, Dan had this comment and this picture and says, the biggest risk is a planet of the AI apps spookily close to the planet of the apes rather than one giant monkey, but millions of them that learned to talk together and take over
Greg White (11:20):
Very, very twilight zone.
Scott Luton (11:22):
We got some justice in our fourth story here today, so it’s coming. Good news is coming. But on our second story, we’re talking about the Red Sea here today, right? So shift over their recent analysis from our friends at CNBC. According to recent data from the Maritime advisory firm, sea Intelligence, the Red Sea crisis, what they say has become more disruptive to ocean shipping than even the early pandemic. Looking at ocean shipping, weekly deviation, data disruption in December, 2023 due to the Red Sea attacks has the second most disrupted period since at least 2014. Again, according to their data, it has yet to surpass the big impact that he ever given pose getting stuck in the Suez Canal. Can you believe that was all the way back in 2021? Greg?
Greg White (12:06):
I don’t know what measure they’re using because there’s no way the ever given had more impact than the pandemic, and there’s also no way that this has had more than
Scott Luton (12:14):
Maybe they’ll pop in and they can share some of their rationale behind the data. Yeah, that’s right. Sadly, unfortunately, given the deadly attacks over the weekend in the region and what may be next, we can probably expect more disruption and certainly conflict ahead. Additionally, Chinese New Year, it’s coming up on February 10th through the 17th. And Greg, as you know, while the holiday is seven days long, some Chinese companies can shut down for weeks, which is always presented quite a ripple effect across global supply chain. Now, Greg, your thoughts on the story, on the data, on their views in general?
Greg White (12:50):
Yeah, I think they’re parsing words here for either the purpose of getting views or seeming whatever thought leading or to help pump ocean rates or something. I don’t know. I just don’t get it. I don’t know what the definition of early pandemic is, but it would be very difficult to have a greater impact on ocean shipping than shutting down an entire planet for almost a year. I mean, sending everyone home virtually overnight for weeks and weeks and months at a time. I don’t see it, but as we’ve said frequently, Scott, there are lies. There are damn lies. And then there are statistics. So if you parse the data just right, maybe you could argue that. So I don’t know what the purpose of this article is or this position is, but I don’t buy it. I just can’t see how it could be. I mean, remember there was a time when you could not get a container when literally all of the containers that were supposed to be heading back to China were left in the US and then vice versa, they were brought to China and not shipped back to the us and all of that was during the pandemic.
(13:58):
So I suppose if you’re worth year three and you weren’t alive during the pandemic, this may be the biggest since you’re in your lifetime, but I’m not seeing it.
Scott Luton (14:08):
I’ve got a church around the corner that’s hanging onto one of those containers. We’ve got it regular free, but you’re not the only one there. Greg Andre doesn’t buy it either. Headline is misleading. This LinkedIn user says perhaps as it relates to insurance premiums, maybe,
Greg White (14:22):
Yeah, I feel like they should have qualified that, right?
Scott Luton (14:25):
Nearshoring, localized sourcing, ENO mentions to the rescue amongst other things, and I would just throw out there C Intelligence. So our friends over at C Intelligence, Hey, reach out to us. Are
Greg White (14:35):
They friends? Do we know these people?
Scott Luton (14:36):
I do not. I see them regularly. I think CNBC uses them quite a bit. They regularly refer to their data, but hey, reach out and we’ll figure out more of what’s the story, what’s the piece that we’re missing here? Who knows? Alright, so Greg, look at this picture here. In this next article, we caught someone, a thief in the act. In the act. Look at there, we’ll move over to cargo theft, which is on the rise, folks, and this is in a lot of folks blind spots. So as reported also by CNBC, cargo theft surged in 2023 as a number of cargo theft incidents was up a whopping 57% over similar incidents in 2022. In fact, the article quotes Scott Carne, the National Practice Transportation Lead at Travelers as saying, I think we’re at an all time high. I hadn’t seen cargo theft at this level. Now, from what I can tell Greg, I looked up Scott Cornell on LinkedIn. It appears that he’s been an industry since 1999 and with Travelers for over 22 years. Cargo net says that the top three hotspots in the US for cargo theft are California, Texas, and Florida losses topped some $130 million in 2023, but since reporting theft isn’t required, that’s probably just the tip of the iceberg. Okay, Greg, your thoughts folks are not just stealing trailers of cigarettes these days, huh?
Greg White (15:52):
And suits. Yeah, like Goodfellas, right? Right. Well, in Florida, I have a feeling it could just be square groupers that they’re stealing that are probably tucked inside teddy bears or whatever, however you ship cocaine these days. But I don’t know. I don’t know specifically what we’re talking about actually, considering the amount of cargo that is shipped, $130 million, I can’t believe I’m going to say this. Scott doesn’t seem like that much does it, but it is much greater than what’s reported, and it’s largely due to the fact that our respective ports are run by governments, which are unbelievably inefficient, although they’re getting better and fairly so rapidly. But there are a lot of opportunities in port. It’s funny that you don’t see all kinds of ships being overtaken, whatever, but you do lose a lot of it on the ground, and I think that’s largely in the port. So I don’t know. I mean, it’s a shame that it’s happening at such a great rate. I think we should thank our lucky stars that it is only $130 million when we literally bring in hundreds of billions of dollars of freight every year. Right?
Scott Luton (17:02):
Well, folks, stay tuned. We’ve got a live show coming up soon where one of the things we’re going to be talking about with the leading construction supplies manufacturer is what they’re doing as it relates to optimizing loss prevention. So stay tuned for that. And Catherine and Amanda, if we have a link handy that’s our friends from a f will be joining us for that show, if we could drop that in the link, I think GAF and Vector will be joining us for that live show. We could drop that
Greg White (17:26):
Link. Cool. That’s who we ought to be asking.
Scott Luton (17:30):
All right, folks, this last story as we shift to the final story here today on the buzz for January 29th, 2024, hard to believe. Goodness gracious, where did the month go? Greg? I don’t know about you. I may know about you a little bit in this regard at least, but when folks do something bad, do something wrong, do something they shouldn’t be doing, especially when it hurts other people, man, I love when they get their justice that they’re due. So for this last story here, I can’t wait to get Greg’s take here, so I’m going to share this graphic and notice folks, this graphic comes from the United States Attorney’s Office of the Northern District of Texas. One of the few times we’ve sourced them for dues here on the buzz, but stay tuned, I’ll connect the dots here. You may recall a while back, Greg White took a gentleman by the name of Chris Kirschner to task, and he didn’t pull any punches. Kirschner was the founder and former CEO of Slink, a supply chain management software startup. He was recently convicted of defrauding investors out of, at least according to the US Attorney’s office, $25 million and now faces up to decades of prison time. I had to stop. I was multiplying. The amount of prison time per count had to stop because my calculator started smoking. Greg, so your thoughts on Chris Kirchner and his misdeeds?
Greg White (18:52):
Yeah. Can you believe that this all started with just my disdain for Chris as one of those publicity seeking wants to be a star, a celebrity founder. I don’t know if you remember, we were just talking about the fact that he wanted to buy a soccer team and he had to be at every public event, and he wanted to run with the big dogs and the a-list people in Hollywood and things like that. What it turns out is that Chris is, and I want to reiterate that this is an opinion show and my opinion may or may not be congruous with that of supply chain now or Scott Luton. Chris is such an imbecile that he left his jobs in the Magnolia store inside of Best Buy and got a startup, and the only people stupider than Chris are the people who invested in him Goldman Sachs, and then left him with zero oversight with the ability to have the only keys to the kingdom.
(19:41):
He had the only access to the account that the money went into when they took investment. So he basically had his hand in the cookie jar and the cookie jar under his arm, and he took it down to the basement and bought himself a jet. Wow. So what started as just disdain for somebody who had so little respect and care for the work that it takes to be an entrepreneur and just wanted to be a celebrity and also certainly did not deserve to be an entrepreneur, he was unqualified, obviously. I mean, seriously, the best job the guy had was selling televisions and stereos. So that quickly turned to, because of the hard work of a real and true journalist, Emma Cosgrove, who now is at Business Insider, who had dug into the fact that people hadn’t been paid for months on end and interviewed a ton of people at the company who in some cases subsequently reached out to me because of how I took Chris to task on what now seemed like superficial matters and started sharing what was going on.
(20:42):
And when people who should have authority over the money like his CF, took it to the board and said he may be misappropriating funds, Chris summarily dismissed, said person. It is so unbelievably symmetrical to an experience I’m having right now with an investment of my own, which will remain unnamed, but it is so incredibly aligned with what’s happening there that it’s eerie as if this founder read Chris’s playbook or something, but it’s a tragedy. Many people lost their jobs. Several people went months without pay, while Chris lied about where the money was or that money was coming, and then subsequently tried to defraud additional investors by creating a fake next round of investment, which had never been approved by the board and did not exist to bring back into the company enough funds to keep the company going even though he had misappropriated some somewhere.
(21:37):
You have to read the pleadings and everything. Somewhere between 20 and 57 million, 50 ish million dollars from the company sent it to his own account. I heard this is hearsay, but it is from a credible source. I heard that the very day that they got their B round of investment, he bought a $16 million G six 50. That’s a jet people, that’s a private jet. Even if that jet was for the company, that was an incredibly inappropriate use of funds. And I cannot believe that any of the investors stood for it for one second, much less the near year that they let it go on, but they did. So now he’s going to prison. It is honestly, people, I have to tell you this, it is really unhealthy how happy I was when I saw this.
(22:23):
Somebody sent it to me. Was it over the weekend? No, it was Thursday, right, Scott? We talked about it on Friday when somebody sent it to me. I was actually joyous. I literally had to sit myself down and talk myself out of being so joyous, because obviously Chris has a family, thankfully, I think no kids, but I’m sure his wife is absolutely beside herself or his in-laws, I believe, who vouched for him to the investment company. Must feel completely embarrassed. But anyway, good for America, good for entrepreneurs, good for the A USA, the assistant US attorney in the Southern district for putting this guy where he belongs, which is in prison.
Scott Luton (23:01):
And that sentencing is coming up from what I can tell from this release from the US Attorney’s Office, but we’re talking decades and decades of prison is what he’s facing. So stay tuned.
Greg White (23:12):
I hope they make it public where they put him. I’m going to go visit him in prison.
Scott Luton (23:16):
Gosh, Andre says, I think there are more stupid and criminal people in circulation than we honest. People realize
Greg White (23:24):
That is very well. It is hard to believe that anyone could be that crooked, but as I’ve seen it firsthand twice now, it is very, very possibly true. Andre
Scott Luton (23:34):
And Jerry says, we get these reminders often. Invest what you can afford to lose and no more,
Greg White (23:41):
And do your diligence. Very true, Jerry. That is a hundred percent. And do your diligence is a mantra that every investor should live by, and the first red flag should be enough red flags. That’s
Scott Luton (23:54):
Right. All it takes is one, maybe half,
Greg White (23:57):
One. I don’t usually do New Year’s resolution, Scott, but this year I did. And it is when you see a red flag, pay attention. That’s my resolution for 2024.
Scott Luton (24:09):
All right, folks, that does it. We were extremely efficient and expedient here today on the Buzz. Remember, we come to you every Monday at 12 in Eastern time, a mix of news and analysis and hot and soft takes, mostly hot, but stories that should be on your radar, right? Really important. And we always welcome your perspective. And as we mentioned on the front end, if you enjoyed today’s show, hey, share it with a friend. Our team sure would be grateful. Okay, Greg, your last comment before we wrap here today.
Greg White (24:40):
I think it’s interesting, this notion that there is more disruption in the world than there has ever been. I would argue that it’s more publicized, but not. And we in this industry, in supply chain, we’re programmed to deal with disruption, almost dismissively, but it is because it’s in the news. It is ever so much more important to be very conscious and diligent in how you deal with it and dealing with it both rapidly and effectively. Because now the world is watching, right? I keep saying this, I’ve said this ever since. Here comes Scott, the great toilet paper shortage of 2020 that now people give a damn about supply chain and they know a little something about it, and they know enough to know that there are plenty of people to blame. So don’t be one of the people. Be the person that silently saves supply chain from disruption.
Scott Luton (25:30):
That is right. Well said there. Greg. Words live by. Alright folks, thanks for joining us here today. Hey, do yourself and your team a favor. Take one nugget, take one news story, one bit of analysis, you name it, something from today’s conversation and put it into action deeds, not words. And with that said, on behalf of our entire team here at Supply Chain now, Scott Luton signing off, challenging you to do good, to give forward and to be the change. And we’ll see you next time, right back here at Supply Chain now. Thanks everybody.
Intro/Outro (26:00):
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