Clifford Asness, co-founder and manager of the hedge fund AQR capital management, called out ARK Invest founder Cathie Wood for her prediction regarding artificial intelligence’s impact on the U.S.’s gross domestic product.
Wood tweeted back in May 2022 that AGI (artificial general intelligence) would help increase the GDP by a staggering 30-50% per year.
For context, last year’s GDP was $23 trillion. A 50% increase would bring us well above $34 trillion. It’s unclear exactly how Wood ended up at the 30-50% increase in GDP number, but it does sound outlandish at first site.
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To Wood’s credit, she has made bold predictions that have come true. Back in 2018, many people called her out for her 'crazy' Tesla Inc TSLA price target when she said it would reach $4,000 a share.
Tesla did indeed end up hitting that price target prediction (with stock splits), and even two years before Wood said the stock would get that high.
Asness responded to Woods’s tweet, saying “Btw, multi-factor quant with a value tilt is going to return one hundred million bazillion percent over the next few years! She’s on to something as this is fun!”
Clearly, Asness is being tongue-in-cheek, comparing his outlandish claim of “million bazillion percent” to Wood's claim about AGI increasing GDP by 30-50%. Asness’s original response was back in May, but he recently retweeted the Tweet bringing it back into the light. Wood's flagship ETF, the ARK Innovation ETF ARKK has been under tremendous pressure recently, making new multi-year lows.
It’s hard to determine which is more likely: a fund returning “one hundred million bazillion percent” or the GDP increasing by 30-50% YoY, but both are pretty outrageous claims.
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