Part 11/16:
A significant portion of the discussion focused on the booming investment in artificial intelligence (AI). Bessent acknowledged that while some fear an imminent bubble, history suggests that similar rapid growth phases often lead to substantial productivity gains—comparable to the late 1990s internet boom.
He sees AI moving into its third inning of investment and adoption, with productivity improvements expected to accelerate early next year. The Biden administration's cautious regulation of AI is viewed as a way to unlock latent demand while avoiding overreach, similar to efforts in financial deregulation that spurred lending and innovation.