Cathie Wood Warns: AI Boom Faces “Reality Check” Correction
Cathie Wood, CEO of ARK Invest, allayed concerns about an artificial intelligence bubble while raising the prospect of a "reality check" on AI valuations.
Quick overview
- Cathie Wood, CEO of ARK Invest, addressed concerns about an AI bubble while suggesting a potential 'reality check' on AI valuations.
- She indicated that rising interest rates could lead to market shifts, stating, 'there will be a shudder' as rates increase.
- Wood emphasized that the relationship between innovations and interest rates is not as straightforward as commonly believed.
- Her comments come amid rising worries about inflated tech valuations as investments in the sector continue to grow.
Cathie Wood, CEO of ARK Invest, allayed concerns about an artificial intelligence bubble while raising the prospect of a “reality check” on AI valuations.
On the fringes of Saudi Arabia’s Future Investment Initiative (FII) in Riyadh, Wood told CNBC’s Dan Murphy that “there will be a shudder” in markets as interest rates start to rise.
The closely watched investor stated, “We are going to reach a moment in the next year where the conversation will shift from lower interest rates to rising rates.”. People believe that there is an inverse relationship between innovations and interest rates.
Over time, that has not been the case, according to Wood. “I want to dispel that idea from people. However, we anticipate a reality check.”
Her remarks coincide with worries about skyrocketing tech valuations as companies and investors pour money into the industry.
Global markets surged at the beginning of this week, with investors encouraged by expectations that the US and China could soon reach a deal.
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