Defending towards AI’s Darkish Aspect!

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    A couple of weeks in the past, I began receiving a stream of message about an Instagram put up that I used to be allegedly starring in, the place after providing my views on Palantir’s valuation, I used to be soliciting traders to take a position with me (or with an funding entity that had ties to me). I used to be not stunned, since I’ve lived with imitations for years, however I used to be bemused, since I haven’t got an Instagram account and haven’t posted on Fb greater than a couple of times in a decade. In the previous few days, these warnings have been joined by others, who’ve famous that there’s now a video that appears and appears like me, including to the gross sales pitch with guarantees of super-normal returns in the event that they attain out, and presumably ship their cash in. (Please do not go searching for these scams on-line, for the reason that very act of clicking on them can expose you to their attain.)

    I want to assume that readers of my books or posts, or college students in my lessons, know me effectively sufficient to have the ability to inform that these are fakes, and whereas this isn’t the primary time I’ve been focused, it’s clear that AI has upped the ante, by way of creating posts and movies that look genuine. In response, I cycled by way of a collection of feelings, beginning with shock that there are some on the market who assume that utilizing my identify alone will attract traders, shifting on to anger on the focusing on of weak traders and ending with frustration on the social media platforms that enable these fakes to exist. As a instructor, although, curiosity beat out all of those feelings, and I believed that one of the best factor that I can do, along with the fruitless train of notifying the social media corporations concerning the fakes, is to speak about what these AI imitators received proper, what they had been astray on and what they received unsuitable in attempting to create these fakes of me. Put merely, I plan to grade my AI imitator, as I might any pupil in my class, recognizing that being goal on this train will probably be robust to do. Within the lead-in, although, I’ve to bore you with particulars of my skilled life and thought course of, since that’s the key to making a normal framework that it is possible for you to to make use of to detect AI imitations, for the reason that sport will solely get extra refined within the years to return.

An Simple Goal?

    In a put up final yr, I talked a couple of bot in my identify, that was in growth part at NYU, and whereas formally sanctioned, it did open up existential challenges  for me. In discussing that bot, I famous that this bot had accessed every part that I had ever written, talked about or valued in my lifetime, and that I had facilitated its path by making that entry straightforward. I’ll clarify my rationale for the open entry, and offer you the hyperlinks if you wish to get to them, hoping to pre-empt those that will attempt to cost you for that content material.

My Open Entry Coverage

    I’ve mentioned this earlier than, however there is no such thing as a hurt in saying it once more, however I’m a instructor, at the beginning, and virtually each alternative I make in my career life displays that mindset. A instructor, like an actor or singer, craves an viewers, and the bigger and extra enthusiastic that viewers, the higher. After I began educating in 1986, my viewers was restricted to these in my bodily classroom at NYU’s enterprise college, and my preliminary makes an attempt at increasing that viewers had been very restricted. I had video recorders set as much as document my lectures, made three copies of every lecture tape, and put them on the cabinets at NYU’s library for patrons to take a look at and watch. The web, for all of its sins, modified the sport for me, permitting me to share not solely class supplies (slides, exams) but in addition my lecture movies, in on-line codecs. Although my early makes an attempt to make these conversions had been primitive, the expertise for recording lessons and placing them on-line has made a quantum leap. In spring 2025, each one in every of my NYU lessons was recorded by cameras which might be constructed into classroom, the conversions to on-line movies occurred in minutes, proper after the category is completed, and YouTube has been a sport changer, in permitting entry to anybody with an web connection anyplace on the earth.

    Because the web has expanded its attain, and social media platforms have joined the combo, I’ve additionally shared the opposite elements that go into my lessons extra extensively, beginning with the information on trade averages that I want and use in my very own valuations, the spreadsheets that include these valuations and weblog posts on markets and firms and some other instruments that I exploit in my very own analyses. Whereas I’m comfortable to obtain compliments for the sharing and reward for being unselfish, the reality is that my sharing is pushed much less by altruism (I’m no Mom Theresa!) and extra  by two different forces. The primary is that, as I famous in my put up on nation fairness threat premiums final week, there a lot of what I do know or write about is pedestrian, and holding it in secret appears foolish. The second is that, whereas I’m not simply outraged, I’m pushed to outrage by enterprise consultants and consultants who state the apparent (changing phrases you realize with buzzwords and acronyms), whereas making outrageous claims of what they’ll ship and charging their clients absurd quantities for his or her recommendation and value determinations. If I can save even just a few of those clients from making these funds, I think about it to be a win.

My Sharing Spots

    Every part that I’ve ever written, labored on or taught is someplace on-line, virtually all the time with no protecting shields (no passwords or subscriptions), and there are 4 locations the place you could find them:

  • Webpage: The oldest platform for my content material stays my webpage, damodaran.com, and whereas it may be creaky, and troublesome to navigate, it accommodates the hyperlinks to my writing, educating, knowledge, spreadsheets and different instruments. 
    • Instructing: I educate two lessons at Stern, company finance and valuation, and have 4 different lessons – a lead-into-valuation accounting class, a made-for-finance statistics class, a category on funding philosophies and one on company life cycles, and I described these lessons in a put up on educating at the beginning of 2025. You will discover all of them by going to the educating hyperlink on my webpage, https://folks.stern.nyu.edu/adamodar/New_Home_Page/educating.html together with my common lessons (class materials, lecture notes, exams and quizzes and webcasts of the lessons) in actual time, in addition to archived variations from earlier semesters. As well as, the on-line lessons are on the identical hyperlink, with materials, post- class exams and webcasts of periods for every class. That is additionally the place the place you could find hyperlinks to seminars that I educate in the remainder of the world, with slides and supplies that I used for these lessons (although I’ve been tardy about updating these).
    • Knowledge: Firstly of yearly for the final three many years, I’ve shared my evaluation of information on publicly traded corporations, breaking down the information into company finance and valuation classes. This hyperlink, https://folks.stern.nyu.edu/adamodar/New_Home_Page/knowledge.html, will take you to the entry web page, and you’ll then both entry the most up-to-date knowledge (from the beginning of 2025, since I replace solely every year, for many datasets) or archived knowledge (from earlier years). My uncooked knowledge comes from quite a lot of sources, and within the pursuits of not stepping on the toes of my knowledge suppliers, my knowledge often displays trade averages, moderately than company-specific knowledge, nevertheless it does embrace regional breakdowns: US, Europe, Rising Markets (with India and China damaged out individually, Australia & Canada & New Zealand) and Japan.  
    • Spreadsheets: I’m not an Excel ninja, and whereas my spreadsheet-building abilities are sufficient, my capability to make them look polished is proscribed. I do share the spreadsheets that I exploit in my lessons and work right here, with my most-used (by me) spreadsheet being one which I exploit to worth most corporations at this hyperlink, with a webcast explaining its utilization.
    • Books: I’ve written eleven books and co-edited one, unfold out throughout company finance, valuation and investing, and you could find all of them listed right here. Many of those books are of their third or fourth editions, however with each, it’s best to discover a webpage that accommodates supplementary materials for that guide or version (slides, solutions to questions on the finish of every chapter, knowledge, spreadsheets backing the examples). That is the one part of the spreadsheet the place chances are you’ll encounter a gatekeeper, asking you for a password, and provided that you search entry to teacher materials. If you’re questioning what’s behind the gate, it’s only the powerpoint slides, with my notes on every slide, however the pdf variations of those slides must be someplace on the identical web page, with out want for a password.
    • Papers: I do not a lot care a lot for educational analysis, however I do like to write down about matters that curiosity or confound me, and you could find these papers at this hyperlink. My two most generally downloaded papers are updates I do annually on the fairness threat premium (in March) and nation threat premiums (in July). A lot of the fabric in these papers has made its manner into a number of of my books, and thus, for those who discover the books unaffordable, you will get that materials right here without spending a dime.
  • Weblog posts: I’ll confess that once I write my first weblog put up on September 17, 2008, I had no thought what a weblog was, what I used to be doing with it, and whether or not it could final by way of the next week. Within the years since, this weblog has develop into my first go-to, when I’ve doubts or questions on one thing, and I’m attempting to resolve these doubts for myself. In brief, my weblog has changing into my remedy spot, in occasions of uncertainty, and I’ve had no qualms about admitting to those doubts. Throughout 2020, as COVID made us query virtually every part we find out about markets and the financial system, as an illustration, I posted on the place I used to be within the uncertainty spectrum each week from February 14, 2020 (when the virus grew to become a worldwide downside, not one restricted to China and cruise ships) to November 2020, when the vaccine appeared. You may get all of these posts in a single paper, for those who click on on this hyperlink. Whereas my authentic weblog was on Google, within the final two years, I’ve replicated these posts on Substack (you’ll want to be a subscriber, however it’s free) and on LinkedIn. If you’re on the latter, you’re welcome to observe me, however I’ve hit my connections restrict (I didn’t even know there was one, till I hit it) and am unable so as to add connections.
  • YouTube: For the final decade, I’ve posted my class movies on YouTube, grouping them into playlists for every class. You can begin with the hyperlink to my YouTube channel right here, however if you’re considering taking a category, my suggestion is that you simply click on on the playlists and decide on the one which corresponds to the category. Right here, as an illustration, are my hyperlinks to my Spring 2025 MBA valuation class and my Spring 2025 Company Finance class. Beginning a couple of decade, I’ve additionally accompanied each one in every of my weblog posts with a YouTube video, that accommodates the identical materials, and you could find these posts in its personal (very lengthy) playlist. 
  • X (Twitter): A few of you may have robust emotions about X, with a few of these emotions reflecting your political leanings and others pushed by the typically poisonous posting on the platform. I’ve been a person of the platform since April 2009, and I’ve used it as a bulletin board, to alert folks to content material being posted elsewhere. In actual fact, outdoors of those “alert” posts, I virtually by no means put up on X, and steer away as far-off as I can from debates and discussions on the platform, since a model of Gresham’s regulation appears to kick in, the place the worst and least knowledgeable posters hijack the controversy and take it in instructions that you do not need it to go.

I can’t consider a single merchandise of content material that I’ve produced within the final decade that’s not on one in every of these platforms, making my skilled life an open guide, and thus additionally accessible to any AI entity. The Damodaran bot that I wrote about final yr has entry to all of this materials, and whereas I signed off on that and one different variant, there are a number of unauthorized variations which were works-in-progress. 

The Commonalities

    My content material has taken many kinds together with posts, movies, knowledge and spreadsheets, and is on a number of platforms, however there are just a few frequent options that they share:

  1. Low tech: I’m decidedly low tech, and it reveals in my sharing. My web site appears to be like prefer it was designed twenty years in the past, as a result of it was, and accommodates not one of the bells and whistles that make for a contemporary web site. My weblog stays on Google blogger, however every part I’ve been informed about how utilizing WordPress would make it extra engaging/adaptable, and my posts are neither quick nor punchy. Each week, I get folks reaching out to me to inform me that my YouTube movies are far too lengthy and verbose, and that I might get extra folks watching with shorter movies and catchier descriptions, and far as I recognize their gives to assist, I’ve not taken them up on it., As well as, I shoot virtually each one in every of my movies in my workplace, typically with my canine within the background, and sometimes with ambient noise and errors embedded, making them positively unpolished.  On twitter, I’ve solely just lately taken to stringing tweets collectively and I’ve by no means used the lengthy textual content model that some skilled twitter customers have mastered. In my protection, I may all the time declare that I’m too previous to be taught new methods, however the fact is that I didn’t begin any of my sharing as a way to buying a bigger social media following, and it could very effectively be true that holding my presence low-tech operates as a screener, repelling mismatched customers.
  2. Course of over product: In my writing and educating, I’m usually taken to job for not attending to the underside line (Is the inventory low-cost or costly? Ought to I purchase or promote?) shortly, and spending a lot time on the why and the way, versus the what. A lot as my verbosity might frustrate you, it displays what I feel my job is as a instructor, which is to be clear about course of, i.e., clarify how I reasoned my technique to getting a solution than providing you with my reply.
  3. Pragmatism over Purity: Although I’m usually criticized for being an “tutorial”, I’m a horrible one, and if there have been an educational fraternity, I might be shunned. I view a lot of an educational analysis as navel gazing, and virtually every part I write and educate is for practitioners. Consequently, I’m fast to adapt and modify fashions to make them match each actuality and the obtainable knowledge, and make assumptions that might make a purist blanch. 
  4. No inventory picks or funding recommendation: In all my years of writing about and valuing markets and particular person shares, I’ve tried my greatest to steer away from making inventory picks or providing funding recommendation. That will sound odd, since a lot of what I do pertains to valuation, and the essence of valuation is that you simply act in your estimates of worth, however right here is how I clarify the contradiction. I worth shares (like Meta or Nvidia or Amazon or Mercado Libre) and I act (purchase or promote) these shares, based mostly on my valuations, however it’s neither my place nor my function to attempt to get different folks to do the identical. That mentioned, I’ll share my story and valuation spreadsheet with you, and if you wish to adapt that story/spreadsheet to make it your personal, I’m at peace with that alternative, even whether it is totally different from mine. The essence of fine investing is taking possession of your funding actions, and it’s antithetical to that view of the world for me or anybody else to be telling you what to purchase or promote.
  5. No business entanglements: In case you do discover my content material on any of the platforms it’s obtainable on, you’ll discover that they’re free, each by way of what you pay and the way you entry them. In actual fact, none of them are monetized, and for those who do see adverts on my YouTube movies, it’s Google that’s accumulating the income, not me. One cause for this follow is that I’m lazy, and monetizing any of those platforms requires leaping by way of hoops and catering to advertisers that I neither have the time nor the inclination to do. The opposite is that I consider (although this can be extra hope than fact) that one of many causes that folks learn what I write or take heed to me is as a result of, a lot as they could disagree with me, I’m perceived as (comparatively) unbiased. I worry that formalizing a hyperlink with any business entity (financial institution, advisor, investor), whether or not as advisor, advisor or as director, opens the door to the notion of bias. The one exception to the “no business entranglements’ clause is for my educating engagements, with the NYU Certificates program and for the handful of valuation seminars I educate in particular person in the remainder of the world. I’m grateful that NYU has allowed me to share my class recordings with the world, and I cannot begrudge them no matter they make on my certificates lessons, although I do supply the identical content material without spending a dime on-line, on my webpage. I’m additionally indebted to the folks and organizations that handle the logistics of my seminars in the remainder of the world, and if I could make their life simpler by posting about these seminars, I’ll achieve this.    

The Imitation Sport

    Provided that my finish sport in sharing is to provide entry to individuals who need to use my materials, I’ve typically taken a lax view of others borrowing my slides, knowledge, spreadsheets and even webcasts, for their very own functions.

  • For probably the most half, I categorize this borrowing as good neighbor sharing, the place simply as I might lend a neighbor a key cooking ingredient to save lots of them the difficulty of a visit to the grocery retailer, I’m at peace with somebody utilizing my materials to assist in their educating, save time on a valuation or a company finance mission, put together for an interview, and even burnish their credentials. An acknowledgement, when this occurs, is far appreciated, however I do not take it personally when none is forthcoming. 
  • There are much less benign copycat variations of the imitation sport – selectively utilizing knowledge from my website to again up arguments, misreading or misinterpreting what I’ve mentioned and reproducing massive parts of my writing with out acknowledgement. To be sincere, if made conscious of those transgressions, I’ve gently nudged the culprits, however I haven’t got a authorized hammer to observe up.
  • Essentially the most malignant variations of this sport are scams, the place the scammers use my content material or identify to separate folks from their cash – the schooling corporations that used my YouTube movies and cost for lessons, the information websites that replicate my knowledge or spreadsheets and promote them to folks, and the valuation/funding websites that attempt to get folks to take a position cash, with my identify as a draw. Till now, I’ve tried, as greatest as I can, to let folks know that they’re being victimized, however for probably the most half, these scams have been so badly designed that they’ve tended to break down below the burden of their very own contradictions.

It’s clear to me that AI is now going to vary this sport, and that I must take into consideration new methods to counter its insidious attain. To get a measure of what the present AI scams which might be making the rounds get proper and unsuitable, I did take the time to take a better have a look at each the Instagram put up and the faux video which might be making the rounds. 

  • What they get proper: The Instagram put up, which is in proven beneath, makes use of language that clearly is drawn from my posts and a picture that’s clearly mine.

    Not solely does this put up replicate the way in which I write, nevertheless it additionally picked Nvidia and  Palantir as the 2 companies to spotlight,  the primary an organization that I personal and have valued on my weblog, and the second an organization that I’ve been speaking about as one which I’m considering proudly owning, on the proper worth, giving it a patina of authenticity. The video appears to be like and appears like me, which must be no shock because it had 1000’s of hours of YouTube movies to make use of as uncooked knowledge. Utilizing a yiddish phrase that I picked up in my days in New York, I’ve the give the scammers credit score for chutzpah, on this entrance,, however I’ll take a notch off the grade, for the video’s slickness, since my movies have way more of a home made really feel to them.

  • What they struggled with most: The rip-off does point out that Palantir is “overhyped”, a phrase that I exploit not often, and whereas it talks concerning the firm’s valuation, it’s cagey about what that worth is and there may be little of substance to again up the declare. Palantir is an enchanting firm, however to worth it, you want a narrative of an information/software program agency, with two channels for worth creation, one in every of which appears to be like on the authorities as a buyer (a lower-margin, stickier and decrease development enterprise) and the opposite at its business market (increased margin, extra risky and better development). Every of the tales has shades of gray, with the potential for overlap and battle, however this isn’t an organization the place you may extrapolate the previous, slap numbers on income development and profitability, and arrive at a price. This put up not solely doesn’t present any tangible backing for its phrases by way of worth, nevertheless it doesn’t even attempt. If these scammers had actually needed to tug this off, they might have made their AI bot take my class, assemble a believable Palantir story, put it into my valuation spreadsheet and supply it as a hyperlink. 

  • What they get wrong: To get a way of what this put up will get unsuitable, it’s best to revisit the sooner a part of the put up the place I speak about my sharing philosophy, and with as a lot distance as I can muster, listed here are the false notes on this rip-off. First, this rip-off pushes folks to affix an funding membership, the place I’ll presumably information them on what to purchase or promote. Provided that my view of golf equipment may be very a lot that of Groucho Marx, which is that I might not be belong to any membership which might admit me as a member, the notion of telling folks which shares to purchase cuts towards each grain of my being. Second, there is part of this rip-off the place I purportedly promise traders who determine to partake that they are going to generate returns of 60% or increased, and as somebody who has chronicled that not solely do most lively traders not sustain with the market, and argued that anybody who guarantees to ship considerably greater than the market in the long run is both a liar or fraud, that is clearly not me. 

In sum, there may be excellent news and dangerous information on this grading evaluation. The excellent news is that this AI rip-off will get my language and look proper, however it’s sloppily finished by way of content material and capturing who I’m as an individual. The dangerous information is that it if this scammer was much less lazy and extra prepared to place in some work, even with the present state of AI, it could have been straightforward to carry up the grades on content material and message. I’ll wager that the Damodaran Bot that I discussed earlier on on this put up that’s being developed at NYU Stern would have created a put up that might have been way more troublesome so that you can detect as faux, making it a Frankenstein monster maybe within the making. The more severe information is that AI expertise is evolving, and it’ll get higher on each one in every of these fronts at imitating others, and it’s best to put together your self for a deluge of funding scams.

An AI Protecting Defend

    I did assume lengthy about penning this put up, questioning whether or not it could make a distinction. In any case, if you’re a frequent reader of this weblog or have learn this put up all the way in which down thus far, it’s unlikely that you simply had been fooled by the Instagram put up or video. It stays an uncomfortable fact that the folks most uncovered to those scams are those who’ve learn little or none of what I’ve written, and I want there have been a manner that I may cross on the next solutions on how they’ll defend themselves towards the opposite fakes and scams that may undoubtedly be directed at them. 

  1. “Seems to be & appears like” not adequate: Having seen the flood of pretend AI movies within the information and on social media, I hope that you’ve concluded that “appears to be like and sounds Iike” is now not adequate to satisfy the authenticity take a look at. This stays AI’s strongest go well with, particularly within the fingers of the backyard selection scammer, and it’s best to put together your self for extra faux movies, with political figures, investing luminaries and consultants focused.

  2. Steer away from conceitedness & hype: I’ve all the time been skeptical of the notion that there’s “good” cash, composed of traders who know greater than the remainder of us and are capable of beat the market persistently, and for lengthy intervals. For probably the most half, once you see a gaggle of traders (hedge funds, non-public fairness) beating the market, luck is extra of a contributor as talent, and success is fleeting. In a speak on the subject, I argued that traders ought to steer away from conceitedness and bombast, and in the direction of humility, with regards to who they belief with their cash, and that applies in spades on the earth of AI scams. Since most scammers don’t perceive the subtlety of this concept, screening funding gross sales pitches for outlandish claims alone will eradicate most scams.

  3. Do your homework: In case you determine to take a position with somebody, based mostly upon a digital meet or gross sales pitch, it’s best to do your homework and that goes effectively past asking for his or her monitor information by way of efficiency. In my class on funding philosophies, I speak about how nice traders by way of the ages have had very totally different views of markets and methods of earning profits, however each has had an funding philosophy that’s distinctive, constant and effectively thought by way of. It’s malpractice to take a position with anybody, it doesn’t matter what their fame for incomes excessive returns, with out understanding that particular person’s funding philosophy, and this understanding may also offer you a template for recognizing fakes utilizing that particular person’s identify. 

  4. Keep away from ROMO & FOMO: In my investing lessons, I speak concerning the harm that ROMO (remorse over lacking out) and FOMO (worry of lacking out) can do to investor psyches and portfolio. 
    1. With ROMO (remorse over lacking out), the place you look again in time and remorse not shopping for Fb at its IPO worth in 2012 or promoting your bitcoin in  November 2013, when it hit $1000, you expose your self to 2 feelings. The primary is jealousy, particularly at those that did purchase Fb at its IPO or have held on to their bitcoin to see its worth hit six digits. The second is that you simply begin shopping for into conspiracy theories, the place you persuade your self that these winners (at the very least within the rear view mirror) had been capable of win, as a result of the sport was fastened of their favor. Each make you prone to chasing after previous winners, and simple prey for distributors of conspiracies.
    2. With FOMO (worry of lacking out), your overwhelming concern is that you’ll miss the subsequent massive multi-bagger, an funding that may improve 5 or ten fold over the subsequent yr or two. The emotion that’s triggered is greed, main you to overreach in your investing, biking by way of your investments, as most of them fall in need of your unrealistic expectations, and trying to find the subsequent “massive factor”, making you prone to anybody providing a pathway to get there.

A lot as we consider scammers because the criminals and the scammed because the victims, the reality is that scams are extra akin to tangos, the place both sides wants the opposite. The scammer’s methods work as a result of they set off the feelings (worry, greed) of the scammed, to reply, and AI will solely make this simpler to do. Trying to regulators or the federal government to safety will do little greater than supply false consolation, and one of the best protection is “caveat emptor” or “purchaser beware”. 

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