YouSaid · the spoken record

Steve Hou

lines on the record: 62
first: 2026-04-29
most recent: 2026-04-29
sittings or episodes: 1
sources: podcast

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“Cushing was going away a little bit, but this one was actually taking over, right? And particularly if you look at, say, just personnel payroll changes, we know that residential construction are very much gone down a lot, but housing market has been frozen. But the aggregate construction payroll has actually been recovering exactly singularly driven by non-residential construction error increases. In other words, there is actually a first order impact on GDP growth against the backdrop of a fairly resilient economy, consumption economy that is very much based on services and less on goods. We can go into how to what extent this is actually wealthy facts, obviously the economy has become very financialized US economy.”
2026-04-29 · Forward Guidance · The AI Bubble Is Widely Misunderstood | Steve Hou · IDENTIFIED FROM THE TRANSCRIPT
“There will be periods in which that could be the case. But so generally speaking, most of the growth scale comes from consumption growth and US economy consumers becoming being quite resilient. But if you look at the second contributor, it's clearly investments inventory change, especially a lot of imported reports from overseas. And that we can see on the mirroring side, Korean economy and Taiwanese economies are absolutely on fire because they just exported so much chips and microchips and memory. So to that extent, we certainly active as a cushion to the US economy have been slowing down from the 2022 rate hike cycle during which we have seen a gradual cool down of the US labor market in various ways and the fiscal stimulus.”
2026-04-29 · Forward Guidance · The AI Bubble Is Widely Misunderstood | Steve Hou · IDENTIFIED FROM THE TRANSCRIPT
“So, in terms of immediate GDP impact, AI so far the biggest impact obviously has come from the buildout itself. We have not really seen very much yet sort of the implications of adopting AI. But the first component, of course, is the investment, if you think about GP being C plus I plus G plus export, right? The most volatile component of GEP is business investment in Carebacks and indeed AI investment has been one of the most notable. I think this idea some people have mentioned, oh, AI has become the only contributor to GDP growth. That's actually not true, right? If you look on a quarter-on-quarter basis over the last year and change, there will be single quarters in which if you had, if you look at what's a Q1 of 2025 or something.”
2026-04-29 · Forward Guidance · The AI Bubble Is Widely Misunderstood | Steve Hou · IDENTIFIED FROM THE TRANSCRIPT
“I became quite convinced that there was enough epistemological uncertainty over this technology that it was going to have to last through its entire logical conclusion before we will have anything like a decision. And indeed, if you look at on the right, this is the biggest and fastest CAPEX cycle we've ever had of all, I think, notable in a past investment cycles, including internet bubble. And in a way, I almost feel like even with the investment as big as has been, we may have actually overlearned some of the lessons from the dot-com bubble that caused us to actually be a little bit more cautious, you know, when it comes this time round in the various stages of the supply chain, which we could get to later, that might have actually met. To the cycle being another bit more elongated, a little bit more drawn out.”
2026-04-29 · Forward Guidance · The AI Bubble Is Widely Misunderstood | Steve Hou · IDENTIFIED FROM THE TRANSCRIPT
“Right, that this wouldn't work out, that the investment cycle will continue. That's how I think that on the first angle I wrote about it. The second angle, I think just intuitively, it felt very always to me very natural, this idea that how does intelligence come about, right? It's really similar to. So, if you look at the first one, right? So somebody made this chart on the right, you know, sort of the investment cycle and how this compares to previous significant investment cycles. And here is me on the left here, possibly in May 2023. I said I'd be very disappointed if the AI bubble wasn't as at least as big as crypto bubble, if not the biggest bubble of all time.”
2026-04-29 · Forward Guidance · The AI Bubble Is Widely Misunderstood | Steve Hou · IDENTIFIED FROM THE TRANSCRIPT
“Well, I guess we will unpack your question a little bit, right? There are two things going on here. One is the economic impact and financial impact. Another one is whether or not this piece of technology is actually the right paradigm to actually achieve the type of intelligence that people were hoping for. I think technology can be very, very powerful and have a massive economic impact and financial impact certainly without necessarily having worked out in the end, right? And I think that is quite clear even from the beginning that there was enough hype around this because just because the mere uncertainty that we didn't know whether or not this was actually going to work was sufficient to get people excited about investing and finding out as long as there was no disapproval or disconfirmation.”
2026-04-29 · Forward Guidance · The AI Bubble Is Widely Misunderstood | Steve Hou · IDENTIFIED FROM THE TRANSCRIPT
“Being a productivity booster, I just know that at least there was enough uncertainty about whether or not it could be that the investment cycle would have to follow through and it would basically be a massive delta cycle in real investments and financial investments and asset valuation and so on that you would have flat follows through. And gradually as the technology developed as ChatGPT evolved to become more powerful as the hallucination actually reduced, decreased and the consistencies of the answers increased, improved and the usefulness in my daily life became more convinced that this was a trajectory that was actually quite promising.”
2026-04-29 · Forward Guidance · The AI Bubble Is Widely Misunderstood | Steve Hou · IDENTIFIED FROM THE TRANSCRIPT
“So, I think to be a trained economic economist is right to be skeptical of technology shocks, especially one that Boses of being disrupting and destroying jobs and making everyone jobless. That is a very typical attitude because historically we've had many, many technological innovations revolutions that did not pan out that way, right? Instead led to augmentation of labor force and people just adapted and found new jobs. I think the one thing I saw even back in 2023 about AI was that it felt very much to me this was at the very minimum significant as the internet itself, right? In terms of a build-up cycle, at the time, I did not necessarily right away believe in its full potential.”
2026-04-29 · Forward Guidance · The AI Bubble Is Widely Misunderstood | Steve Hou · IDENTIFIED FROM THE TRANSCRIPT
“Off of just unpack your AI thesis and how you think about it. Why were you so confident back in 2024 when it was just this random chat bot that seemed to hallucinate nonstop? What was the vision and how do you think about it as this academically trained economist?”
2026-04-29 · Forward Guidance · The AI Bubble Is Widely Misunderstood | Steve Hou · IDENTIFIED FROM THE TRANSCRIPT
“Since the blood chaff has been working on and working on leveraging the data that Bloomberg has, I'm very special angle through which we can get the route.”
2026-04-29 · Forward Guidance · The AI Bubble Is Widely Misunderstood | Steve Hou · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, so I'm a quant researcher at Bloomberg Indices, which is sort of Cuba think of Bloomberg either. They think of either the news business or the terminal data business. And there is actually an index business where we create systematic investable indices that is passive benchmarks or stuff that leverages data to create things that result a little bit more exotic away from the benchmarks. And that is sort of what I do, what was the letter. My training comes from academic macroeconomics and asset pricing. I got my PhD in macro and financial econometrics at the University of Michigan in 2018, after which I joined a quant hedge fund called AQR Capital. I was there for a couple years. And then I joined Bloomberg in 2020.”
2026-04-29 · Forward Guidance · The AI Bubble Is Widely Misunderstood | Steve Hou · IDENTIFIED FROM THE TRANSCRIPT
“I mean, of course, it's a bubble. I mean, yes, in a bubble, it was always going to be a bubble, right? Just because something's a bubble doesn't mean that you couldn't have very large, sustained impact. The question is, how long is the bubble? How big could the bubble get? And at what stage are we? The AR bubble is very much adopted and used by everybody almost right away, unlike the dot-com bubble where you actually have a lot of unused capacity that was at the end gold out. Now you have AI calling itself, right? Which changes the magnitude of AI compute demand probably by 100 fold or potentially more depends on just how crazy you let the AI agents go. And that obviously changes the picture completely. One reason why a lot of people underestimate the most recent acceleration is because”
2026-04-29 · Forward Guidance · The AI Bubble Is Widely Misunderstood | Steve Hou · IDENTIFIED FROM THE TRANSCRIPT