Wall Street "Legendary Tycoon" Tudor Jones: The AI Bull Market "Can Last Another Year or Two"

Ask AI · Why is the AI bull market compared to the internet commercialization period of 1995?

Legendary hedge fund figure Paul Tudor Jones stated that the AI-driven stock market bull run has not yet reached its end, and he has recently increased holdings in related stocks, seeking historical references from the tech boom cycle decades ago.

Jones said on a media program Thursday that the current stage of AI development is highly similar to the period of accelerated internet commercialization in 1995, estimating that this round of AI bull market has completed about 50% to 60% of its journey, “and can last another one or two years.” He compared the current market feeling to 1999 — about a year before internet bubble stocks peaked in early 2000.

Jones also issued a warning: If the stock market rises another 40% from the current level, the total market value of US stocks relative to GDP could climb to 300% to 350%, at which point “a suffocating large correction is bound to occur.” While optimistic about the future, he does not shy away from the downward impact when the bull market ultimately ends.

Jones is the founder and chief investment officer of Tudor Investment, renowned for accurately predicting and profiting from the 1987 stock market crash. His latest remarks provide an endorsement from a market veteran for the ongoing volatile AI trading logic, and offer investors a reference for re-establishing the timing of the AI rally.

Analogy of Microsoft and the Internet: Productivity Miracles Still in Midway

Jones compares recent breakthroughs in AI to two historical milestones: one is Microsoft’s early dominance in software in the 1980s; the other is the mid-1990s internet commercialization wave, especially the acceleration of internet applications after the release of Windows 95 in 1995. He believes both technological revolutions initiated a sustained four to five and a half-year productivity surge and market uptrend cycle.

“I think, in January this year, Claude is equivalent to the moment Microsoft was launched in 1981,” Jones said. He views the large model Claude released by Anthropic earlier this year as a landmark node in this AI revolution process.

“Both periods are the starting points of productivity miracles, each lasting four to five and a half years,” he said, “We are now roughly at 50% to 60%. If I had to pick a reference period, I think there’s still another one or two years to go.”**

Bull Market Signals Are Emerging, Corrections Could Be “Suffocating”

Despite his optimistic outlook for the future, Jones remains highly alert to downside risks at the end of the bull market. He pointed out that, in terms of overall market trend, the current feeling is still like 1999 — not the peak of the internet bubble in 2000. This judgment suggests that the market may still have room to rise, but the top is not far off.

“Imagine if the stock market rises another 40%, the market cap-to-GDP ratio could reach 300%, 350%,” Jones said:

“At that point, some… suffocating large correction will inevitably occur.”

In recent years, driven by expectations that AI will transform industries and significantly boost productivity, US stocks have continued to rise, led by chip manufacturers, cloud computing companies, and generative AI developers, with the S&P 500 repeatedly hitting new highs.

Recently Increased AI Asset Holdings, Diversified “Basket” Approach

Jones said he has recently increased his holdings in AI-related investments but did not disclose specific timing or stocks. He emphasized that, as a macro trader, his usual approach is to buy a basket of related assets rather than betting on a single stock.

“I’m a macro trader, so I just buy a basket,” he said, “I just want to say, this is a crazy, crazy era… I always like to look for historical precedents.”

In the context of AI still being in its early development stage, Jones’s statement confirms the current bull market logic while also hinting at concerns over overvaluation — a stance of both optimism and caution, perhaps reflecting the mindset of many institutional investors today.