Demand for compute in AI is going to 'absolutely skyrocket': Toggle AI co-founder Jan Szilagyi

Joining us right now to talk markets and the AI sector we want to bring in Jan Salagi he is Co founder of toggle AI that's an AI fintech company that uses machine learning to turn data into insights for investors and Jan, thank you for being here thanks for having me so how do you use AI? Because we were just talking about AI wondering is that more than garbage in, garbage out? Explain to us where we are in AI and how you're using it. Yeah, it's a very fine line. So we, we, we, we've built, we've built toggle terminal that's currently used by a number of a number of hedge funds. And the key component of it is what we call a knowledge graph. And it's the knowledge graph that's being fed by these generative AI models where effectively you're learning about relationships that matter between NVIDIA and interest rates and so on. So in those areas where you need a model to process large amounts of data, unstructured or structured, it's extremely, extremely helpful, but you need to control it tightly and, and control it tightly meaning what knowing what the input is. And yes, you need to know we only, we only give it access to data that we know how our high level of integrity. And so it doesn't just randomly pick it. So AI is great when you can have maybe a small language model, not necessarily a large language model that inputs everything that's out there on the planet. Maybe it's more useful if you're looking at smaller scales. Actually, you can use a large language model. The key still is just that the connections that it's establishing are based on data that you have faith in, so that when it's looking and learning about certain things, it says, aha, OK, I'm going to look at data and CPI data, for example, only from trusted sources, not just what I find on the web. So what have you learned? What have some of the insights shown you since you've been using this? So there are a lot of things that one thing we discovered is that there's a lot of insights that are left in the data, the data we use every day that would have gone otherwise undiscovered because you can process it at such scale. So for example, you're able to detect a decline in trading volume in a particular security and how that might impact price action going forward way before it actually happens. Or how that combines with the overall macro environment if the economy is slowing picking up on, you know, we have flash Pmis today and so on. Like all of these things combined to give you a more complete picture of what you could see over the next few days, next few weeks and so on. What, what do you think about the AI stocks in general? We were talking about this huge run up. We've seen maybe a pullback this week, yes, but what what do you see when you're looking at those trends? To me, it's still just looking from inside out, looking at what how few actual commercial applications we've had of some of this technology. I think the infrastructure still has a long way to go. So when I look at things like NVIDIA cloud stock, cloud compute stocks and so on, it really feels like we're trying to do streaming in the mid 1990s where the infrastructure wasn't even ready to actually completely take advantage of it. So I think there's going to be a lot more demand for all of this. I mean, you're you're talking back 20 years. How how quickly is that infrastructure going to be built up at this point? There's billions and billions and billions of dollars. Yeah. And you're seeing demand obviously for chips. But I think what you're then also going to start seeing is a lot more demand for compute. When a lot of these applications start to be used by large financial institutions, by hedge funds and so on. I think demand for that is going to absolutely skyrocket. Is this going to be a serious edge in trading to have access to AI? Is it going to almost make the markets more uneven for retail traders who don't have access to it? It's an it's, it's a good question. I think the way we think about at least around the toggle terminal is that, you know, if you were the first person ever to get a Bloomberg Terminal, you probably felt like had an edge By the time most people had it, you almost had to have it. I think the same thing is going to happen here will become natural to have it is just such a great productivity booster that you will feel like you're it's like not having access to Google search like you just you need access to this. OK, So with toggle and the AI that you're using, what do you see in terms of where the market stands with the Fed when rate cuts are coming or what that matters? What crystal edge that you have that everybody else we talk to all the time may not the the main. So what we're currently focused on is market breadth, which I think a lot of other people are focused on as well. But what we're seeing is that because the economy remains actually in really good shape, you should expect a broadening of the rally as opposed to shrinking. I think a lot of what we currently see in the news is people expecting, OK, if NVIDIA falls, then the market is basically done. But actually, I think the way to look at it is there are a lot of other stocks, like you look at Russell 2000 that is basically flat on the year, even though a lot about the macroeconomic picture, it looks really good. Sure, the Fed is not cutting rates aggressively, but so long as the inflation doesn't turn out, which is the second thing we're focusing on, I think you're actually in a pretty good space.