It’s only an argument against the EMH if you take the exploitability of AI timeline prediction as axiomatic. If you unpack the EMH a little, traders not analyzing transformative AI can also be interpreted as evidence of inexploitability.
The OP described how a trader might exploit AI timeline prediction for financial gain if they believed in short timelines, such as by borrowing. Are you saying they are wrong, and that it’s not possible to exploit low real rates in this manner? I have to point out that this is not the argument you were making in the comment I responded to. Markets certainly are thinking very hard about AI, including the immediately transformative possibilities of LLMs like ChatGPT for search. Even if markets ignored the possibility of doom, it seems like they’d at least be focusing heavily on the possibility for mega-profits from controlling a beneficial AI. And it’s not like these ideas aren’t out there in the world—advances in AI are a major topic of world conversation.
At the very least, if markets were considering the possibility of AI takeoff and concluding it was inexploitable, that would not look like “if you could peer into the internal communications of trading firms, and you went looking for their thoughts about AI timelines affecting interest rates, you wouldn’t find thoughts like that.” It would look like firms thinking very hard about how to financially exploit AI takeoff and concluding explicitly that it is not possible.
It’s only an argument against the EMH if you take the exploitability of AI timeline prediction as axiomatic. If you unpack the EMH a little, traders not analyzing transformative AI can also be interpreted as evidence of inexploitability.
The OP described how a trader might exploit AI timeline prediction for financial gain if they believed in short timelines, such as by borrowing. Are you saying they are wrong, and that it’s not possible to exploit low real rates in this manner? I have to point out that this is not the argument you were making in the comment I responded to. Markets certainly are thinking very hard about AI, including the immediately transformative possibilities of LLMs like ChatGPT for search. Even if markets ignored the possibility of doom, it seems like they’d at least be focusing heavily on the possibility for mega-profits from controlling a beneficial AI. And it’s not like these ideas aren’t out there in the world—advances in AI are a major topic of world conversation.
At the very least, if markets were considering the possibility of AI takeoff and concluding it was inexploitable, that would not look like “if you could peer into the internal communications of trading firms, and you went looking for their thoughts about AI timelines affecting interest rates, you wouldn’t find thoughts like that.” It would look like firms thinking very hard about how to financially exploit AI takeoff and concluding explicitly that it is not possible.