By Harry Wu, 21st Century Business Herald, SFC
While AI has led to a significant rise in the stock prices of related companies, it's still unknown whether this will become a bursting bubble. “The key thing going forward is going to be whether all the investments into AI start to earn a decent return,” said Rob Subbaraman, Head of Global Macro Research and Co-Head of Global Markets Research at Nomura in an interview with 21st Century Business Herald.
Subbaraman believes that to achieve this, we need to see AI being adopted globally, becoming general-purpose technologies, and companies reimagining their production processes and organizational structures to incorporate AI and improve productivity—this could be a very positive outcome.
Overall, Subbaraman expects the AI investment boom to continue this year. While there may be winners and losers, this is part of the creative destruction inherent in new technologies, he added.
It's important to note that AI is a double-edged sword. Subbaraman believes that governments and policymakers need to pay attention to the impact of AI on the labor market. There is going to be a lot of jobs that can become obsolete, but not workers becoming obsolete. New job opportunities will be created, and governments can retrain workers through various labor market programs to make it more flexible.