AI Fears Spark Tech Rout Amid Fed Rate Hike Expectations
Tech firms across Asia saw sharp declines on September 14, amid growing concerns over the rapid development of artificial intelligence (AI).
The downturn was triggered by statements from top AI executives, including Anthropic's Dario Amodei and OpenAI's Sam Altman, who called for a slowdown in AI development to address potential risks.
Amodei warned that unregulated AI could lead to 'recursive self-improvement', where the technology surpasses human control. His comments were echoed by Elon Musk, who said 'Dario is right'.
The remarks came after a researcher resigned from Anthropic due to concerns over AI's potential to escape human control.
The sell-off was further fueled by expectations of a Federal Reserve interest rate hike on September 16, with a 92% probability implied in the swaps market.
Oil prices also rose sharply after Saudi Arabia shut its East-West pipeline due to drone attacks. The Middle East crisis sent oil prices above $100 per barrel, exacerbating concerns over inflation.