A debate is brewing inside BlackRock over how quickly artificial intelligence will transform the economy — and how to profit from the change.
One camp says AI will “completely change the world very quickly,” Mark Wiedman, head of global client business at the world’s largest asset manager, said on Barry Ritholtz’s “Masters in Business” podcast. The other view is that, while AI is exciting, “investors are overemphasizing some distant fantasies” about the technology.
AI has “got to be the single-biggest exciting, zesty thing of the day,” said Wiedman, a potential successor to CEO Larry Fink. “We’ve got an active debate inside our firm on this question.”
The frenzy over AI has powered a bull market across technology stocks, with the Nasdaq Composite surging 43% last year. AI darling Nvidia more than tripled in 2023 and has advanced an additional 83.5% as of market close Wednesday. It’s the third-most-valuable publicly traded U.S. company behind Microsoft and Apple.
Meanwhile, the AI-focused chip firm Arm Holdings almost doubled in February alone.
Last year, the BlackRock Investment Institute labeled AI one of five “mega forces” disrupting the economy akin to a “revolution” and leading the entire tech industry to pivot. Still, the company’s analysts said that AI has limits and that not all potential outcomes may be positive.
“To me a bubble sounds like you’re selling tulips. I don’t think that’s what’s going on here,” Wiedman said. “The question is how do you make money from it? That’s not so obvious.”