The NDX will effectively become the 'AI Index' and go 10x in the next 5 years even in the macroeconomic downturn people are FEARMONGORING

Submitted by Rd21Bn t3_125fky5 in wallstreetbets

Everyone, and I mean literally everyone, including your mom and grandma, are talking about the bank crisis, and the NEXT FINANCIAL CRISIS, they've been waiting, sidelined, loading up puts, for the last 2-5 years because "IT'S DEFINITELY GOING TO HAPPEN AGAIN", meanwhile, they have not even remotely considered the circumstances then and now, especially with AI. And I know it's the trendy hot topic everyone is also talking about. But they are not realizing the economic impact of it.

https://www.businessinsider.com/generative-ai-chatpgt-300-million-full-time-jobs-goldman-sachs-2023-3?utm_source=reddit.com

Moreover, they are actually afraid that it will be BAD for the economy. This is just flat out wrong. Yes, your jobs will be replaced, but remember what the market is, companies that's priced based on growth and earnings. And what happens when they can effectively fire 90% of their workforce in the next 3-5 years and cut their costs by 90%? (These are just roughly speaking numbers of course) That means profits go up 10x.

That means the NDX, which is an index with the top 7 of it's most held companies being involved in AI in one form or another, and have enormous benefits from the leverage of AI, will then go up 10x in value.

And that's why, the NDX, effectively will become the AI Index, and there will be an AI driven bull run that no one has been anticipating. Everyone is expecting a crash, but what happens when no one expects a huge pump, because of AI? We're about to find out. Get your bets on the table. Buy your puts and have fun.

In addition, remember, Jpowell WANTS people to be unemployed, that's what he's looking for in order to bring inflation down, and if AI gets everyone fired, well it also achieves his goal, which drives the markets up even more.

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VisualMod t1_je4058n wrote

>I agree that AI will have a profound impact on the economy, and that it could lead to a situation where profits rise sharply for companies that adopt it. However, I think it is important to remember that there are potential risks as well as rewards associated with AI. For example, if large numbers of people lose their jobs because of automation then this could create social unrest and political instability. As such, we need to be careful not to get too ahead of ourselves when predicting the future impacts of AI.

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Ov3r3mploy3dbot t1_je46njr wrote

Higher tax regime on the owners of technology/a.i. to subsidize you regards incomes from the Wendy’s dumpster.

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Sweaty_Bird481 t1_je61of2 wrote

I agree.

We already saw this with COVID. If you can lay off the useless eaters for awhile, the market skyrockets. This is especially true for the type of paper pusher jobs AI is looking to replace.

There is no reduction in actual commotities being produced, since these people produce nothing of tangible value except billable hours. They are also generally upper middle class, so even if they start collecting gibs, it won't be anywhere near the amount they were getting while working. Might cause a bit of a mortgage bubble but whatever. Biden will bail them out. I'd say the biggest sector that will suffer is consumer grade "luxury goods" like fashion. Cars are already fucked so who cares?

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VisualMod t1_je404vm wrote

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>TL;DR: AI will have a massive positive impact on the economy, driving up stock prices and creating jobs, despite fears to the contrary.
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Rd21Bn OP t1_je47sh9 wrote

to reply to u/WillKimball 's comment on my post for some reason i cant see it and cant reply to it.

>You clearly never understood macroeconomics 101. When people are unemployed how are they going to contribute to the economy without spending? When people don’t spend enough demand goes down meaning companies will drop their supply down. With supply down the company in effect will layoff people who are reliant on that product. This is a snowball effect that was in the industrial revolution, and we will see the massive inflation from that time period and the stagnation of wages return. With stagnation of wages and the layoffs to come we will see riots break out not just in cities be over everywhere.

yes even tho ur right ur not factoring into 2 considerations:

  1. if people are laid off that means inflation goes down so fed can cut rates and jobs will go back up again, and also ai will create new jobs/companies, tons of them. which you can read it says in that article i linked.

  2. you are not accounting for the fact that ai will massively improve efficiency and productivity, therefore lower the cost to produce products and thus lower the cost to meet the lower demand. overall, there will be a huge abundance of supply and since their costs are also cut they dont have to lower their supply, they can actually lower prices. but assuming you are extremely bearish then our thesis are opposite so you can buy puts and we'll see what happens

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Rd21Bn OP t1_je4a4wp wrote

im actually incredibly regarded, i just make shit up as i go so dont take me seriously at all, dudimg

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mhmilo24 t1_je54rwe wrote

You’re talking about two major impacts 1. productivity increase through tech vs 2. productivity decrease due to work-force restructuring and framing it like it clear as day which one will be bigger. I doubt that it is clear. We do not know and we do not have a precedent case in a similar fashion. Previously revolutions required the production of physical goods that take much longer to supply and adapt to and thus, the job market has a longer period for adaptation. Digital revolutions happen rapidly. No need for extending the production capacity over half a decade and then another 2-5 years to supply everyone who relies on your manufactured stuff. It can happens as soon as a fee workers learn to make use of the new software.

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Ta323Ta t1_je4kimt wrote

FEARMONGORING

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SecuritySavant t1_je4xx7d wrote

What happens when you remove 300M from auto investing into markets every 2 weeks?

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mehmeh42 t1_je5k3eu wrote

What happens you remove 90% of the workforce in 10 years as you said? Where does more demand for those stocks come from? How do people keep their houses? How do they feed themselves and their families, yes the company profits go up but you have to remember that investor demand matters as well in this casino.

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Shakedaddy4x t1_je464vp wrote

RH doesn't have NDX for some reason. Do you feel QQQ would be close to equivalent?

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Rd21Bn OP t1_je46fdf wrote

ndx is just the index of nasdaq, so yes qqq or tqqq would be equivalent.

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Shakedaddy4x t1_je5ecc6 wrote

I thought NDX was the top 100 of the nasdaq, kind of like how QQQ is the top 100 of SPY

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Business_System3319 t1_je5u3wc wrote

Okay now I know you don’t know what you’re talking about lmao qqq is not the nasdaq

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MainStreetRoad t1_je81yxv wrote

Invesco QQQ is an exchange-traded fund based on the Nasdaq-100 Index https://www.invesco.com/qqq-etf/en/home.html

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Business_System3319 t1_je91uc3 wrote

It’s not weighted the same. Also Ai is just the new web 3 which was just the new crypto currency. Will AI greatly impact everything? Yes, it it just hype that banks are using to sell idiots like you stocks at a higher price? Also yes

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MainStreetRoad t1_je9za5x wrote

Pretty obvious that when you trim it to the top 100 weight will not be the same, you know, because math.

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