AI is driving enormous investment and soaring valuations, but what do financial markets reveal about its long-term economic impact?

Jesús Fernández-Villaverde, Howard Marks Presidential Professor of Economics at the University of Pennsylvania, and Maryam Farboodi, Associate Professor at Cornell SC Johnson College of Business, examine how investors are pricing the promise and risk of transformative AI. They discuss why Treasury yields fell following major AI announcements, whether high AI stock valuations reflect productivity gains or speculation, and what the dot-com era can teach us about today's AI boom.

The conversation also explores AI's potential effect on inequality, the risks of regulation that slows adoption, and the skills people will need in an AI-driven economy.

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