Dalio warns: The AI bubble will not burst temporarily, it is still too early to exit now.

On November 21, billionaire investor and Bridgewater founder Ray Dalio believes that even if you worry that the market frenzy is a bubble waiting to burst, you shouldn't give up on the field of artificial intelligence (AI) too soon. In an interview with CNBC on Thursday, he stated that he is convinced the current stock market is deeply entrenched in a bubble—but that is still not a reason for investors to exit AI trading. Dalio explained to the media that the reason investors should stay in the market is simple: the conditions for a bubble to burst do not currently exist. “Don't sell just because of the bubble,” the legendary fund manager said, “You have to time it. What would burst the bubble? Typically, it is a tightening of monetary policy, and we are not facing that situation right now.” In Dalio's view, a bubble will only ultimately burst when there is a demand for asset liquidation in the market. He speculates that events such as rate hikes by the Fed or consumers facing a wealth tax could trigger selling. In the foreseeable future, both scenarios seem unlikely to occur in the market. “I want to reiterate that the stock market could rise significantly before the bubble bursts,” Dalio added. (Jin10)