Paul Tudor Jones said the bull market powered by artificial intelligence is still here, adding that he has recently bought more related stocks looking for similarities to the earlier tech boom.
The billionaire hedge fund manager said recent advances in AI are similar to the emergence of innovative technologies such as: microsoftThe early software dominance of the 1980s and the commercialization of the Internet in the mid-1990s were periods that ushered in years of productivity growth and market rise.
“I think this January will be a similar year for Claude to Microsoft in 1981,” Jones said Thursday on CNBC’s “Squawk Box.”
Jones, founder and chief investment officer of Tudor Investments, also compared the current stage of AI adoption to 1995, when commercial use of the Internet accelerated with the launch of Windows 95.
“All of that was the beginning of a productivity miracle that lasted four to five and a half years,” Jones said. “I think we’re 50% or 60% done. If we were to pick a time frame, we have another year or two.”
Stock markets have soared in recent years, partly on optimism that AI will transform industries and accelerate productivity gains. Mega-cap technology companies tied to AI infrastructure led the rally as investors poured money into chipmakers, cloud computing companies and generative AI developers, helping the S&P 500 repeatedly hit record highs.
Jones said that while AI development is in its early stages, in terms of a bull market, it’s still like 1999, about a year before the dot-com peak in early 2000. Once the bull market ends, the market decline could be significant, Jones said.
“Imagine if the stock market went up another 40%. Stock market GDP would probably be 300% or 350%. We know there will be a breathtaking correction,” he said.
Still, Jones said he added investments in AI, but declined to say when he made the purchases or which stocks he bought.
“I’m a macro trader, so I just buy baskets, but what I’m simply saying is these are crazy, crazy times. … I always love finding historical precedents,” he said.
The prominent investor warned of the long-term risks posed by the technology, saying that eventually governments would need to step up to regulate it. Jones said he is increasingly concerned about the potential for artificial intelligence to become dangerous to humanity if left unchecked.
Jones rose to fame after predicting and profiting from the 1987 Black Monday stock market crash. He is also chairman of Just Capital, a nonprofit organization that ranks U.S. public companies based on social and environmental metrics.
