The AI Boom Is Transforming the American Economy Beyond Recognition by Justin Lahart
AI has rapidly become a huge economic factor while affecting everything from capital investment to how much you pay for an iPhone. The U.S. economy keeps putting more eggs in the artificial-intelligence basket. Oxford’s Michael Pearce estimates that AI investment alone has been behind nearly a quarter of the growth in gross domestic product recently. The AI-boosted stock market is the other big source of support. In the first quarter, U.S. household net worth reached $174 trillion, according to the Federal Reserve, an increase of $13 trillion from a year earlier that was mostly due to stock gains. Since then, the broad S&P 1500 index has risen by about 15%, so net worth is likely trillions of dollars higher now. Those gains have been driven in large part by enthusiasm for AI. When people’s net worth increases, they spend more freely. Estimates of these wealth effects vary, but economists generally think that for every dollar in stock-market wealth gained, people spend a few cents more. The AI Boom Is Transforming the American Economy Beyond Recognition – WSJ
