The stock market is making new all time highs very frequently right now, so at first glance, many people would think that the economy must be very strong. While the stock market is certainly an important indicator of overall economic health, it is not the only one.

In addition, when analyzing the stock market as a whole, it is important to look at what is driving its growth. According to some warnings by Deutsche Bank, the US Stock Market is largely being driven not just by the tech industry, but by one segment of the tech industry.

Artificial Intelligence.

According to a report in Fortune, George Saravelos, the Deutsche Bank head of FX Research, wrote to clients:

“AI machines — in quite a literal sense — appear to be saving the US economy right now. In the absence of tech-related spending, the US would be close to, or in, recession this year.”

Being overly dependent on one industry for economic health is not a good thing, but if it is generating massive value, than it can be acceptable. For example, for quite some time now, the larger IT sector has been leading the economy, and that was fine since it was actually making products (computers, phones, cars, etc) and generating revenue.

With AI, on the other hand, there is very little revenue being generated currently. The investments are largely into the development of chips and the building of data center facilities needed to power the technologies.

Of course, the companies behind AI are promising world-changing abilities, but they have not yet come into existence.

Many different companies are trying to incorporate AI into their business model with varying levels of success. Software developers within companies are often reporting that while AI may be fast, it is not yet nearly good enough to deliver a finished product when it comes to usable programs.

Companies that force developers to use AI to generate code find that the developers end up spending more time cleaning up the code than they would have just writing it themselves.

That being said, nobody would deny the potential that AI technologies bring to the table. Spending even a little time interacting with the basic version of ChatGPT shows that the technology is a big step forward compared to things like traditional search engines or websites.

The question is, however, will AI be able to advance to the point where it can generate real revenue before the pocketbooks of investors and venture capitalists run dry, causing the entire stock market to crash.

If you think that’s impressive, check out this story about a “goldmine” of lithium that was found in the U.S. that could completely change the EV battery game.