President Biden's Executive Order on Artificial Intelligence

President Biden and the White House published an Executive Order on AI that highlighted the potential risks and benefits of the technology and outlined the administration's plans to ensure its safe, secure, and trustworthy development and use.

Many AI professionals had expected controls centered on the large AI leaders in the U.S. that could have crippled the ability of smaller players to compete.  However, the document was more benign and was mostly aimed at developing safety standards and establishing security protocols.

The statement notes that AI has the potential to transform many aspects of our lives, from the way we work and learn to the way we interact with the world around us. However, it also warns that AI can pose risks, such as discrimination, bias, and job displacement.

The Fact Sheet explains that The Executive Order directs the following actions:

·       Require that developers of the most powerful AI systems share their safety test results and other critical information with the U.S. government.

·       Develop standards, tools, and tests to help ensure that AI systems are safe, secure, and trustworthy. 

·       Protect against the risks of using AI to engineer dangerous biological materials.

·       Protect Americans from AI-enabled fraud and deception by establishing standards and best practices for detecting AI-generated content and authenticating official content.

·       Establish an advanced cybersecurity program to develop AI tools to find and fix vulnerabilities in critical software.

·       Order the development of a National Security Memorandum that directs further actions on AI and security, to be developed by the National Security Council and White House Chief of Staff. 

To address these risks, the administration is taking a number of steps, including (italics are direct quotes from the Fact Sheet):

• Issuing an executive order that establishes new standards for AI safety and security, protects Americans' privacy, advances equity and civil rights, stands up for consumers and workers, promotes innovation and competition, and advances American leadership around the world.

• Securing voluntary commitments from leading AI companies to help move toward safe, secure, and transparent development of AI technology.

• Investing in research and development to develop new AI technologies that are safe, secure, and trustworthy.

• Working with international partners to develop global norms and standards for the responsible development and use of AI.

To Promote Innovation and Competition – the Executive Order provides the following instructions:

• Catalyze AI research across the United States through a pilot of the National AI Research Resource—a tool that will provide AI researchers and students access to key AI resources and data—and expanded grants for AI research in vital areas like healthcare and climate change.

• Promote a fair, open, and competitive AI ecosystem by providing small developers and entrepreneurs access to technical assistance and resources, helping small businesses commercialize AI breakthroughs, and encouraging the Federal Trade Commission to exercise its authority.

• Use existing authorities to expand the ability of highly skilled immigrants and nonimmigrants with expertise in critical areas to study, stay, and work in the United States by modernizing and streamlining visa criteria, interviews, and reviews.

The Biden-Harris Administration will continue working with other nations to support safe, secure, and trustworthy deployment and use of AI worldwide. To that end, the President directs the following actions:

·       Expand bilateral, multilateral, and multistakeholder engagements to collaborate on AI. The State Department, in collaboration with the Commerce Department, will lead an effort to establish robust international frameworks for harnessing AI’s benefits, managing its risks, and ensuring safety. 

• Accelerate development and implementation of vital AI standards with international partners and in standards organizations, ensuring that the technology is safe, secure, trustworthy, and interoperable.

• Promote the safe, responsible, and rights-affirming development and deployment of AI abroad to solve global challenges, such as advancing sustainable development and mitigating dangers to critical infrastructure.

The statement concludes by emphasizing the administration's commitment to working with the private sector, civil society, and academia to ensure that AI is used for good.

Finally, the Executive Order issued the following instructions to U.S. Government agencies:

• Issue guidance for agencies’ use of AI, including clear standards to protect rights and safety, improve AI procurement, and strengthen AI deployment.  

• Help agencies acquire specified AI products and services faster, more cheaply, and more effectively through more rapid and efficient contracting.

• Accelerate the rapid hiring of AI professionals as part of a government-wide AI talent surge led by the Office of Personnel Management, U.S. Digital Service, U.S. Digital Corps, and Presidential Innovation Fellowship. Agencies will provide AI training for employees at all levels in relevant fields.

In short, the Biden administration is taking a comprehensive approach to address the risks and opportunities of AI. The administration's goal is to ensure that AI is used to benefit all Americans while protecting them from potential harm.  Companies that work with AI should consider some of the same measures.

Source:  White House Fact Sheet, October 30, 2023

From ChatGPT: ATTENTION is Key to Good Prompts

Question for ChatGPT: How can I use knowledge of AI transformer attention to improve the effectiveness of my prompts for ChatGPT?

1.     Provide Sufficient Context: Transformer models use attention to weigh the importance of each word in the input when generating a response. (This is the purpose of role-playing.) Therefore, providing clear and sufficient context in your prompts will help the model generate more relevant and accurate responses. Keep in mind that if a conversation is very long, some of the older parts may be ignored due to the model's token limit (e.g., 2048 tokens for GPT-3), so the most relevant information should be closer to your current prompt.

2.     The Sequence of Information: Since attention mechanisms weigh all words in the input but give more importance to recent ones, the sequence in which you present information can impact the response. Important information is often better placed toward the end of your prompt.

3.     Avoid Ambiguity: Transformer models can struggle with ambiguous prompts because they cannot ask clarifying questions. They will make their best guess based on the attention scores, which may not align with what you intended. So, strive for clarity in your prompts.

4.     Use Instructive Prompts: Instructive prompts, where you tell the model what kind of answer you're looking for, can help get the desired output. For example, if you want a summarized answer, you can say, "In a short summary, explain...".

5.     Experiment with Different Prompts: Different prompt styles can lead to different responses because of how attention weights are assigned. If you're not getting the results you want, try rephrasing your prompt or presenting the information in a different order.

6.     Temperature & Max Tokens: You can adjust parameters like 'temperature' and 'max tokens’ to influence the response. Higher temperature values make the output more random, while lower values make it more deterministic.

7.     The 'max tokens' parameter limits the length of the response. Token Limitations: There is a maximum limit on the number of tokens the model can handle. For GPT-3, this is 2048 tokens, but it may vary for later versions. If a conversation exceeds this limit, you might need to truncate your text, this could cause the model to lose context.

8.     Incremental Queries: If your query is complex, you can break it down into multiple simpler queries. This can often result in better responses, as the model can handle each part separately.

9.     These suggestions are based on general principles and might need some experimentation & adjustments to get the best results for your specific case. The model doesn't genuinely understand the context or have real-world knowledge beyond its training data, manage your expectations.

Sources:

ChatGPT sources: "Attention is All You Need" by Vaswani et al., 2017: This paper introduced the concept of the Transformer architecture, which is the foundation of models like GPT-3 and GPT-4. Understanding how attention works in these models can help you craft effective prompts.

OpenAI's GPT-3 paper: This paper presents the model's capabilities and suggests some strategies for generating effective prompts.

"The Illustrated Transformer" by Jay Alammar is a helpful resource for understanding how the Transformer model works, with visualizations to assist comprehension.

Various blog posts, articles, and tutorials by the AI community: Many practitioners share their experiences and insights online, providing practical tips on using AI language models effectively.

The temperature parameter is used in the sampling process of a language model's output. It determines how focused or diverse the output will be. Here's how you adjust it: When you use an API like OpenAI's to interact with a model like GPT-4, you can specify the temperature as a parameter in your API call.

The temperature parameter controls the randomness of the model's responses:

• High temperature values (close to 1.0) make the output more diverse and creative, but also more likely to be inconsistent or make errors.

• Low temperature values (close to 0.0) make the output more focused and deterministic, often sticking closely to the style and content of the input. However, the responses can also be more repetitive and less creative.

You can adjust the temperature value according to the needs of your application. If you want more creativity and are okay with a bit of randomness, use a higher temperature. If you want more consistency and focus, use a lower temperature.

Remember, as of my knowledge cut-off in September 2021, the actual effect of the temperature parameter can depend on various factors, including the specific model version and the complexity of the input prompt. For up-to-date information, always refer to the latest documentation from the API provider.

Gathering Financial Information with ChatGPT

ChatGPT does more than answer questions; it is closer to a search engine than a thinking app. However, ChatGPT does have uses when gathering Financial Data.

To gather financial planning and analysis information with ChatGPT, you can follow these steps:

Define the objectives: Determine the specific information you need for financial planning and analysis. It could include financial statements, budgeting, forecasting, performance analysis, variance analysis, key performance indicators (KPIs), or any other relevant metrics.

1. Prepare questions: Create a set of questions or prompts that you can ask ChatGPT to obtain the desired financial information. Structure your questions to be specific, concise, and clear. For example, you could ask:

• "What were the total revenues for the previous quarter?"

• "Can you provide a breakdown of operating expenses by category?"

• "What is the projected net income for the next fiscal year?"

• "What are the key drivers affecting profitability?"

1. Engage in a conversation: Interact with ChatGPT using natural language to ask your questions. Many AI platforms, including ChatGPT, provide an API that allows you to integrate the model into your application or system for seamless communication.

2. Interpret responses: Analyze the responses provided by ChatGPT and extract the relevant financial information. Ensure that the information aligns with your expectations and matches the context of your financial analysis requirements. Exercise critical judgment and verify the accuracy of the information obtained.

3. Refine and iterate: If the initial responses from ChatGPT are not satisfactory or require further detail, refine your questions and prompts to seek the desired information. Experiment with different phrasing and approaches to improve the effectiveness of your communication with the model.

4. Provide context and constraints: When seeking financial planning and analysis information, it can be helpful to provide additional context or constraints to guide the AI model. For example, you can specify a particular time period, assumptions, or specific data sources to narrow down the response.

5. Cross-validate with other sources: While ChatGPT can provide insights, it's advisable to cross-validate the information obtained from the model with other trusted sources or financial data. Use the AI-generated information as a reference point and validate it against established financial reports, internal data, or inputs from domain experts.

6. Iteratively improve the model: Provide feedback on the responses given by ChatGPT, particularly when it misinterprets or misunderstands your questions. This feedback can help improve the model's performance over time.

Remember that ChatGPT is a language model that relies on the data it was trained on, and it may have limitations or biases. Therefore, it's important to exercise critical thinking, validate the information, and use the AI-generated insights as a supplement to human judgment and expertise.