AI investment boom may lead to bust, but not likely systemic crisis, IMF chief economist says

By David Lawder

WASHINGTON (Reuters) -The U.S. artificial intelligence investment boom may be followed by a dot-com-style bust, but it is less likely to be a systemic event that would crater the U.S. or global economy, the International Monetary Fund’s chief economist, Pierre-Olivier Gourinchas, said on Tuesday.

There are many similarities between the late 1990s internet stock bubble and the current AI boom, with both eras pushing stock valuations and capital gains wealth to new heights, fueling consumption that added to inflation pressures, Gourinchas told Reuters in an interview.

Then, as now, the promise of a new, transformative technology ultimately may not meet market expectations in the near-term and trigger a crash in stock valuations, he said. But just as in 1999, investment in