Goldman Sachs has maintained steadfastly that an artificial intelligence (AI) bubble does not exist. Rather than the anticipated bubble, the financial powerhouse believes we are on the precipice of an AI revolution.
Goldman Sachs rejected vehemently in a recent publication a comparison between the recent rise in AI stock prices and the dot-com mania of the late 1990s.
In the publication, Goldman Sachs’ Chief Global Equity Strategist Peter Oppenheimer continued:
“We are convinced that we are still in the early phases of a new technology cycle, which is poised to deliver additional strong performance.”
By 2025, Goldman Sachs anticipates a considerable increase in global investments in artificial intelligence, which could reach $200 billion. This increase is attributable to the significant economic opportunities presented by generative AI, a subset of AI that generates content using vast language models.
According to previous estimates, generative AI could contribute as much as $4,4 trillion to the global economy.
Following the decline in 2022, AI-related equities have contributed to the recovery of the entire SP500 index throughout the year. According to the report, the market-leading stocks’ valuations are less inflated than during previous periods, such as the internet bubble that broke in 2000.
In addition, according to the report, these businesses have exceptionally robust balance sheets and returns on investment.
While the outlook appears positive, some experts recommend a cautious approach when contemplating AI sector investments. Oppenheimer developed the PEARL framework to aid individuals in making well-informed decisions following extensive research.
