Key Insights
Key takeaways from "Artificial intelligence – beyond the buzz" report published by BlackRock
CFTE summarised “Artificial intelligence – beyond the buzz” report by BlackRock. This report identifies digital disruption and artificial intelligence (AI) as one of the five key megaforces shaping a new era of macroeconomic and market volatility. It emphasizes the transformative impact of AI on the way we live and work, and the consequent market reshaping as companies rapidly adopt this technology.
Key Aspects
- The report discusses the progression of AI technologies, such as Large Language Models (LLMs), and their potential future applications.
- It highlights the challenges in measuring AI innovation and the significance of AI patents in understanding economic value and market trends.
- The report also touches upon the need for significant investment in infrastructure to fully harness AI and addresses the limits of AI adoption, including cybersecurity risks and reliability issues of generative AI.
Table of Contents
- 1. Introduction to Megaforces
- 2. AI as a Transformative Force
- 3. Measuring AI Innovation
- 4. Investment Opportunities in AI
- 5. Challenges and Limits of AI Adoption
Key Findings and Insights
This report will give you an insight into:
- AI as a Transformative Force: AI, particularly technologies like Large Language Models (LLMs), is seen as a key factor in transforming markets and industries. The report compares the rise of AI to historical revolutions such as the industrial and information revolutions, highlighting its potential to reshape various aspects of work and life.
- Progression of AI Technologies: The report notes that the development of AI, especially LLMs, is ongoing and requires time, new skills, and massive data sets. It suggests that advances in AI are likely to be exponential, as observed in the rapid improvements with each iteration of LLMs.
- Measuring AI Innovation: Measuring innovation in AI is challenging, but AI patents are mentioned as one indicator, even though they don't capture the entire picture due to the open-source nature of much AI development. The report finds a positive correlation between a pickup in AI patents relative to historical trends and broad earnings growth in the near term.
- Investment Opportunities in AI: Significant investment is deemed necessary to fully harness the potential of AI. The report highlights the importance of securing top AI talent, investing billions to fund ambitions, and amassing the computing power needed for innovations.
- Interactions with Other Technologies and Megaforces: AI's interaction with other technologies and megaforces is expected to create significant investment opportunities. The report suggests that understanding where products may sit on the tech stack is crucial for identifying potential beneficiaries of these megaforces.
- Challenges and Limits of AI Adoption: While the potential for AI is vast, there are limits to its adoption. Concerns include cybersecurity risks and the reliability issues of generative AI. The report also acknowledges that while governments are attempting to address these risks, it may slow the pace of adoption in certain sectors.
- Focus on Future Research: The report indicates that future research will focus on AI’s interaction with other technology and megaforces, emphasizing the need for substantial investment in infrastructure to harness AI effectively.
Key infographics
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