BlackRock Says AI Could Be the 'Biggest Uncertainty We've Faced'

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moomoo News Jun 20 10:43 · 23.2k Views

Jean Boivin, head of BlackRock Investment Institute, discusses the AI-driven tech rally and why Japan is his biggest overweight in terms of risk assets.

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Transcript

  • 00:00 I think you're overweight tech and the AI theme,
  • 00:02 is it more Europe?
  • 00:03 I mean, Europe just because of the nature of the economy, the proximity to some of the wars,
  • 00:08 you know, valuations are a little bit lower.
  • 00:09 Is that how you play it or you just go for the the big seven in the US,
  • 00:13 actually the big six, yeah, or five or we'll see.
  • 00:15 Yeah, but yeah, no, it's it's mainly the US still to to this day.
  • 00:18 I mean, it's true from a valuation perspective.
  • 00:20 You, you, you, you see more opportunities in Europe as a result.
  • 00:23 But like the,
  • 00:24 the AI team is playing first in the USI think
  • 00:28 there's a lot of investment is happening there.
  • 00:29 CapEx is being deployed.
  • 00:30 It's going to be pretty significant.
  • 00:32 And I think
  • 00:33 and there's AUS polar attraction that is pretty, pretty strong there.
  • 00:35 So it's US first.
  • 00:37 I think Europe
  • 00:38 eventually will benefit, but it's less clear for us now.
  • 00:40 But
  • 00:41 what industries will be disrupted the most?
  • 00:43 And again, can you play AI through disruption in industries or is it a little bit too soon?
  • 00:49 The other point I would make on the Eye is that like we believe it's a big story.
  • 00:52 How it's going to play out is I think this is the biggest uncertainty we probably face in my professional life.
  • 00:57 It could be extremely fast, it could be very low.
  • 01:00 Everybody's trying to make sense of it.
  • 01:02 So big uncertainty,
  • 01:04 I think.
  • 01:05 And the big question is
  • 01:07 how much is going to be augmenting labor as opposed to replacing labor.
  • 01:10 And that I think
  • 01:12 we're watching.
  • 01:13 So it's more about right now
  • 01:14 looking at the companies that can extract profits from the situation, the knock on effect I think is going to be something we need to watch and not the time to play it just yet.
  • 01:22 And John, overall, what region?
  • 01:24 I mean, I know you like the US quite a lot.
  • 01:26 Do you believe that there could be, you know, the the end or a slowdown of US exceptionalism and does that impact the markets or is it a longer term
  • 01:35 kind of protracted story that we could see play out?
  • 01:37 Yeah, I think, I think
  • 01:38 it is the case that I don't think that that reality has really sunk in from in markets yet that we're weak on the other side of COVID.
  • 01:45 Now on the track globally that is much weaker than we were pre COVID.
  • 01:49 the US is the exception.
  • 01:51 So it's the one that is doing the best.
  • 01:53 But even the US is on the slower track.
  • 01:55 So I think there's there is a structural story
  • 01:58 of,
  • 01:59 you know, slower growth demographics being behind that high debt
  • 02:02 AI is the offset to this.
  • 02:04 So we'll see how it plays out.
  • 02:06 But in terms of other regions, we are interested that Japan is for us the place where we have the biggest overweight right now in terms of risk asset equities.
  • 02:12 And the reason there is because that's the only place where we see macro.
  • 02:15 The macro environment has been your friend as opposed to other places.