The Powerful Yet Fragile Force Propping Up Stocks and the Economy
The artificial intelligence boom has pushed up the stock market, even as interest rates have pulled it down, our columnist says.
TL;DR
- The stock market and broader economy are strong despite bond market turmoil.
- Rising interest rates, driven by oil prices and the war in Iran, have reached their highest levels since 2002.
- The artificial intelligence industry is a potent force supporting the stock market and the economy.
- The iShares U.S. Technology ETF, a proxy for AI-led tech stocks, returned 33.7% this year.
- AI accounted for an estimated 0.6 to 0.7 percentage points of the U.S. economy's 2.3% real GDP growth in the second quarter.
- Concerns are mounting about the dangers of AI, particularly reports of rogue agents.
- This AI-driven economic foundation is considered precarious.