A strategist who called the Asian financial crisis sees parallels with the AI boom

Albert Edwards, the strategist widely remembered for warning ahead of the 1997–98 Asian financial crisis, now draws a parallel between that episode and today's artificial intelligence boom. His concern is not that AI lacks potential, but that the economic benefits being priced into markets remain a promise rather than a demonstrated reality. In his view, investors may be capitalizing future productivity gains before they appear in earnings or broad economic data.

The comparison matters because the Asian crisis was less about weak fundamentals than about expectations that outran what economies and companies could deliver. Whether AI follows a similar path is uncertain. What is observable is the gap between heavy investment in AI infrastructure and the still-limited evidence of economy-wide productivity improvement. That gap is what Edwards highlights.

For markets, the debate centers on timing rather than direction. If AI-driven efficiency arrives broadly, current valuations may prove justified; if it arrives slowly, the adjustment could be sharp. What to watch: corporate capital spending on AI, measurable productivity data, and whether earnings growth actually reflects the technology's promised gains.