Federal Reserve Daly: AI bubble does not pose a threat to financial stability for the time being

A potential artificial intelligence (AI) bubble in the stock market may not threaten overall financial stability, Mary Daly, president of the San Francisco Federal Reserve Bank, said recently. "We should be wary of the idea that all bubbles are classified as financial bubbles, and there is not much evidence that AI bubbles fall into this category," Daly stressed. She pointed out that from a research and economic perspective, investment in AI is more like a "beneficial bubble" - even if investors do not reap the full returns expected by early enthusiasts, they can leave productive results rather than nothing. Specifically, Daly gave three reasons: one is that the AI capital spending boom is driven by financially sound large companies, rather than a wave of high-risk startups, and does not pose a threat to financial stability; the second is that even if investors are too enthusiastic, they can help this transformative technology development, similar to the Internet after the bursting of the Internet bubble. Third, AI may be transformative as iPhone, unlocking unknown opportunities and improving overall economic productivity. (Global Market Broadcast)