OpenAI's viral ChatGPT chatbot reached 100 million monthly active users in just two months in January after launching in November, making it the fastest-growing consumer application in history. For some context, it took TikTok nine months after its launch to reach 100 million users and Instagram 2.5 years.
TS Lombard's Dario Perkins told clients Thursday there are "large effects, and their macroeconomic impact could show up faster than economists anticipate – especially given the pace of technological adoption we are currently seeing."
Perkins, who heads the global macro desk at TD, found that the widespread adoption of the viral chatbot might spark faster innovation:
ChatGPT gained 100 million users faster than any other application in history, and these fast adoption rates are not confined to individual users. Major corporations, such as Bain & Company, have entered into deals with OpenAI to use generative AI in their strategy consulting business, while companies like Expedia have integrated ChatGP T through plug-ins.
The more exciting impact on living standards, however, is likely to come from the second of our productivity channels – the pace of technological innovation. Generative AI can significantly expedite the R&D process by automating complex tasks, analysing vast datasets and predicting potential outcomes. It has already been useful in biological research: DeepMind's AlphaFold predicted the 3-D structure of almost every known protein – a task that had been predicted to take decades of human labour (according to the journal Science, the most important scientific breakthrough of 2021).
This, alongside other AI breakthroughs, has led Dr. David Baker from the Institute for Protein Design to estimate that the pace of innovation in his field is now 10 times higher than it was 18 months ago. If we see rapid increases in innovation across other areas, the impact on productivity could be transformative.
He stated AI "has huge potential to boost economy-wide productivity" and cited a recent MIT study that showed a massive improvement in productivity while using ChatGPT. Also, much of the productivity gains were seen between 21 to 40-year-olds.
Perkins mentioned "massive uncertainties about where AI is ultimately headed" from here. And he wasn't too concerned about layoffs, unlike Goldman, who has warned about 300 million jobs could be displaced by AI in the US and Europe.
And AI is here to stay, unlike Zuck's overhyped metaverse.
So the bottom line, as Perkins laid out, is that massive and rapid adoption of ChatGPT will "deliver significant productivity improvements" for society. He added, "This is a big deal for a global economy that has been stuck in a long secular productivity funk." However, he wasn't too concerned about jobs being displaced, unlike other macro desks.
"The US has had the biggest collapse of durable goods inflation in the near 70-year history of the measure. The plunge of over 20 percentage points is more than twice the previous record" - UBS— zerohedge (@zerohedge) May 26, 2023
ChatGPT will do the same to service (wage) inflation
There is much more in the full TS Lombard report available to pro subs in the usual place.