Bank of America wants you to know there's a good chance the universe isn't actually real


Analysts at big banks regularly publish all sorts of insights and predictions regarding the direction of the financial markets. Goldman Sachs says there are continuing challenges in the retail space. Morgan Stanley isn’t very happy with how Coach is performing. Bank of America thinks there’s a good chance the universe isn’t real.

Wait. Run that last one by me again?

It’s true. In an infographic sent to the bank’s Merrill Lynch clients last week about business challenges and opportunities coming up in the future, Bank of America analysts casually noted that there was a 20-to-50 percent chance that “we are already living in a simulated world”:

Many scientists, philosophers, and business leaders believe that there is a 20-50% probability that humans are already living in a computer-simulated virtual world. In April 2016, researchers gathered at the American Museum of Natural History to debate this notion. The argument is that we are already approaching photorealistic 3D simulations that millions of people can simultaneously participate in. It is conceivable that with advancements in artificial intelligence, virtual reality, and computing power, members of future civilizations could have decided to run a simulation of their ancestors.

Before we get into how weird it is to send this out to your banking customers, let’s first say that, yes, this is a legitimate theory. The infographic even has footnotes to the relevant academic literature—specifically the work of philosopher Nick Bostrom, who came up with the 20-to-50 percent figure.

To simplify Merrill Lynch’s explanation a bit more, think of the video game The Sims. Imagine you wanted to make a version of The Sims so accurate and lifelike that you’d be able to use the characters in the game to simulate almost any situation you can think of. A simulation that realistic would necessitate that the characters be able to think, feel and make decisions like real people. They would need to think they are real people in order to act the way real people do. So what would happen if those Sims found out they were in a game? That’s what this e-mail is suggesting: That we are The Sims.

(A lot of people also use the example of The Matrix when discussing this theory, but I don’t because I’m not 12.)

This isn’t just the province of philosophers. Tesla CEO Elon Musk has apparently talked about this subject so much it’s become de rigueur for him. He’s convinced we actually are not living in a “base” reality, but rather we’re in a simulation and building up our technology to the point that we’ll be able to make our own simulations.

“It got to the point where every conversation was the AI/simulation conversation, and my brother and I agreed that we would ban such conversations if we were ever in a hot tub,” Musk said at a conference earlier this year.

But let’s get back to Bank of America’s email for a moment. Everything else in the message they sent out has actionable investment advice linked to emerging technology markets, and the Merrill Lynch division manages more than $2.2 trillion, giving their clients a lot to invest. But what’s a savvy wealth manager to do when faced with a 20-to-50 percent probability that reality is an illusion?

Merrill Lynch doesn’t have the answers. But I do. Here are a few financial tips for the investor who has come to believe we are actually just a bit of post-singularity jetsam.

  • Liquidate physical assets like real estate property, gold, works of art, etc. What’s the point of storing up material wealth if everything is immaterial anyway?
  • Divest from tech companies that are pushing the envelope on space exploration, like Musk’s SpaceX. We don’t know how far outside of Earth this simulation can extend. The last thing we need is to land people on Mars and suddenly all of reality drops to a lower resolution, or even breaks up altogether.
  • Instead, put your money in companies at the cutting edge of video game development and artificial intelligence. If we are a simulation than we might as well make our own simulation and laugh at those poor fools trying to figure this question out.
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