Ray Dalio’s Warning: AI May Be the Revolution That Survives the Bubble
The technology can change civilization while investors still lose fortunes buying it at the wrong price
Ray Dalio recently gave one of the clearest explanations I have heard of the strange position investors find themselves in today.
Artificial intelligence may be one of the most important technological revolutions of our lifetimes.
And AI may simultaneously be helping create one of the great investment manias of our lifetimes.
Those statements are not contradictory.
In fact, financial history suggests they frequently occur together.
That is the paradox investors need to understand.
The greatest bubbles are often built around something that is genuinely revolutionary.
Railroads were real.
Electricity was real.
Automobiles were real.
Radio was real.
The internet was real.
And artificial intelligence is real.
But there is an enormous difference between correctly predicting a technology's future and correctly valuing the financial assets tied to it.
That distinction may become enormously important over the next several years.
Dalio Agrees With Grantham: The Classic Signs Are Appearing
During the interview, Dalio is asked about Jeremy Grantham’s warning that America may be experiencing an enormous AI-driven investment bubble.
Dalio’s response is essentially:
Yes. The classic signs are there.
