BlackRock lauds AI as ‘mega force’ to drive returns

Global investment titan BlackRock, which manages some $10 trillion in assets, has declared artificial intelligence a “mega force” that could create significant returns for investors in today’s “unusual” market.

In its mid-year outlook

Macro-finance commentator @Financelot told his 90,000 followers on Twitter that the AI boom — which has seen shares in GPU-manufacturer Nvidia skyrocket by more than 180% in six months — is actually being fueled largely by demand for specific AI-focused computing chips.

The AI narrative was used to mask the true source of chip demand coming from China front-running U.S. export restrictions. That’s why chips were hot but memory (DRAM & NAND) remained in decline.

Once the U.S. passes the restrictions this whole “AI” narrative implodes overnight. https://t.co/cSvHVTinRC

— Financelot (@FinanceLancelot) June 29, 2023

In his view, once the U.S. implements export restrictions on these chips, the share prices of AI-related companies will falter.

While there’s bullishness for AI, recent weeks have seen the investment giant turn its gaze to Bitcoin. On June 15 the firm submitted an application to the Securities and Exchange Commission (SEC) for a spot Bitcoin Exchange Traded Fund (ETF).

If the application is successful, it will be the first spot Bitcoin trust product to be approved by the regulator. Senior investment analysts from bloomberg have pinned Blackrock’s chance of an approval at 50%.

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