Goldman Sachs forecasts that artificial intelligence could contribute approximately $8 trillion in present-value capital income over the next 10 to 15 years. The bank's projections range from $5 trillion to $19 trillion, contingent on the pace of AI adoption and productivity improvements. However, Goldman Sachs warns that much of AI's potential earnings boost is already reflected in current equity market valuations, particularly in the U.S., which may limit long-term returns for investors.
The firm advises investors to prioritize fundamentals, cash-flow stability, and productivity gains across different regions and sectors, rather than focusing solely on AI-driven narratives. Despite the potential for AI to expand profit pools, Goldman Sachs highlights that high valuations and current price-to-earnings ratios could restrict further market re-rating.
Goldman Sachs Predicts $8 Trillion AI Economic Impact, Cautions on Equity Valuations
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