Make a Fortune on This 2500-Year-Old Chinese Game

Written by Charles Mizrahi
Posted January 9, 2018

“This is Chinese game. Too hard for you.”

I was first introduced to the Chinese game Go when I was barely out of high school.

But I didn't know that it would end up changing my life nearly 40 years later...

Back then, my father had needed an extra hand in his garment business. He'd hired me to oversee production for the summer.

Most of the production was done by Chinese contractors in New York’s Chinatown.

I would go each day to visit the sewing contractors.

My job was to update my father on when the goods would be finished. This was very important. Every order that we received from a retailer had a cancellation date.

If the order was not shipped by that date, the retailer could cancel the order.

The number one reason we were late? Production problems. The garments were waiting to be sewn together. Each day, I visited the shops to report back to my father.

When lunchtime came, the shop would fill with the aroma of white rice. The workers would line up and receive a bowl of steaming rice each.

They would then put toppings that they'd brought from their homes, such as pork, beef, or chicken, on top of the rice.

Although close to 40 years have passed, I can still smell the freshly steamed rice...

The Game That Would Change My Life

I became friendly with one contractor named Mr. Lee. When I was visiting his shop, Mr. Lee would offer me tea. We would then sip tea and talk about politics, business, and life.

In China, Mr. Lee had been an economics professor. When he'd emigrated to the U.S. in the early 1970s, he'd worked as a dishwasher at a local restaurant.

There wasn’t much demand for an economics professor with a degree in communist economies — especially in the U.S. After saving his money, he'd opened a sewing contracting shop with just two sewing machines.

Ten years later, Mr. Lee was one of the largest contractors in Chinatown. His shop floor had more than 100 sewing machines.

After work, he would sit at a table, across from the shop steward, and play Go. Between long drags on his cigarette, he would contemplate moves and plan his strategy. I used to stop by the shop on my way home to watch.

I once asked Mr. Lee to teach me Go. He told me in broken English, “You American — stick to chess. This is Chinese game. Too hard for you.” And then his face would break into a big smile.[1]

I never did learn how to play Go or take much of an interest in it.

Until last year...

Harder Than Chess

Mr. Lee wasn’t joking when he'd said Go was a hard game.

Go is a 2,500-year-old board game invented in ancient China. It’s played by two players, and the game uses pieces called stones. The object of the game is to surround more territory than your opponent.

The rules are simple, but the game has very complex strategies...

While computers were able to beat most board games, they had a very difficult time with Go.

Artificial intelligence (AI) researchers use board games because they're complex and challenging. John McCarthy, who coined the term artificial intelligence in the early 1950s, said chess is the “drosophila of AI."

He was making reference to how significant early research of the fruit fly was to genetics. Games, such as chess, are the testing ground where researchers test algorithms and ideas.

They want to learn how to apply what they learn to big, real-world problems.

It took more than two decades, but AI finally won against chess.

In 1997, IBM’s supercomputer Deep Blue beat the world chess champion, Garry Kasparov.

In 2011, IBM’s computer Watson competed on the game show Jeopardy and won.

But they were having no such luck with Go...

Here’s Why

Go is much more complex than chess. It requires learning very subtle patterns in how the stones lay on the board.

There are more than 1-followed-by-170-zeros possible positions. That’s more than the number of atoms in the universe. And more than a googol (1 followed by 100 zeros) times larger than chess.

In May 2017, AlphaGo, a computer program developed by Alphabet’s Google took on Ke Jie — the world's highest-ranked Go player.[2]

Over three games, AlphaGo dominated the world champ.

This was very big news.

AlphaGo wasn’t just an expert system with a handful of rules. Instead, it used general machine-learning techniques and learned how to win.

This was a giant leap forward for AI and deep learning.

Google and Facebook are already using deep learning to identify images, recognize spoken words, and understand natural language.

The impact on science will be enormous.

The computer could process a large amount of data and learn from it. It might even suggest a way of moving forward that could lead to major breakthroughs...

Bigger Than the U.S. Economy?

One study is projecting that AI could add close to $16 trillion to the global economy over the next decade.[3]

The companies that are at the forefront of this wave will do very well. Here are two companies that will profit greatly:

  • Facebook (FB) is using AI to scan for posts about suicidal thoughts and to send mental health resources to the user.

  • Oracle (ORCL) uses AI and deep learning across its cloud applications.

And that’s just the tip of the iceberg. Truth be told, every major company the world over is scrambling to use it, and every billionaire I know is scrambling to invest in it.

It’s that big.

But believe me when I say these are the early days of AI and fortunes will be made for years to come.

And I’ve found the one company that stands to make millions for its investors.

The company that I’ve been researching is what's at the forefront of this huge trend. This company is a fraction of the size of FB and ORCL but will dominate the market.

All my best,

Charles Mizrahi signature

Charles Mizrahi
Founder, Park Avenue Digest

Twitter: @Park_Ave_Digest

Charles cut his chops on the trading floor of the New York Futures Exchange before moving on to become a wildly successful money manager on Wall Street.

And with more than 35 years of recommending stocks under his belt, Charles has knocked the cover off the ball, compiling an amazing record of success and posting gain after gain for his loyal readers. He is the founder of Park Avenue Investment Club and the Insider Alert newsletters.

Charles is also the author of the highly acclaimed book, Getting Started in Value Investing.

[1] You could learn the game of Go in about 15 minutes by clicking here.

[2] Google just created an even stronger AI program: AlphaGo Zero. It's the latest evolution of AlphGo.

[3] To see the full report about the impact of AI on the global economies, click here.

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