NEW YORK—Mary Callahan Erdoes, head of J.P. Morgan Asset & Wealth Management , declared Thursday that artificial intelligence is no speculative frenzy but the opening act of a sweeping transformation in business, brushing aside investor jitters over sky-high chipmaker valuations.
At CNBC’s Delivering Alpha summit, Erdoes told a packed room that markets are misreading the timeline. “We’re standing on the precipice,” she said. “The world is pricing AI multiples as if the revolution is already here, but companies haven’t pushed the gains through to the bottom line.”
Her reassurance arrived on a day when stocks took their sharpest tumble in five weeks, with Nvidia, AMD, and other AI darlings leading the decline—yet the broader indexes still sit within striking distance of all-time highs.
Erdoes invoked Ernest Hemingway’s line about bankruptcy to describe AI’s trajectory: gradual buildup, then sudden impact. “Explosive growth is coming on both revenue and expense lines,” she predicted. “Suppliers are racing to thread the pipeline.”
Michael Arougheti, CEO of Ares Management, reinforced the view from the same stage. Current capital outlays, he argued, are dwarfed by AI’s eventual economic footprint. “We can’t ramp supply fast enough for near-term demand,” he said, labeling the trillion-dollar figures “revolutionary, not hyperbole.”
The optimism extended beyond technology. Erdoes, who oversees $5 trillion in client assets, scoffed at five years of recession forecasts that never materialized. “If no downturn is in sight, credit markets are a buying opportunity,” she said. “Lean in.”
For all the enthusiasm, Erdoes urged precision. Investors must drill into specific applications—U.S. adoption is gaining, she noted, but far from mature. Blanket bubble talk, she implied, misses the nuance of a technology still in its infancy.
As Wall Street digests the latest sell-off, the message from two of finance’s heaviest hitters is clear: the AI story is just beginning, and the real payoff lies ahead.
