It started with the "ChatGPT moment" just a little more than two years ago. This was the introduction of generative AI, and it set into motion the race to "retool" the world's data centers to accelerated computing.
The big hyperscalers have already spent a couple hundred billion dollars, and might only be one-fifth of the way there.
The next wave is "agentic AI." This is the digital workforce. It's already happening — autonomous agents performing tasks and operating independently of direct human control.
Jensen sees agentic AI as a multi-trillion dollar industry.
And this leads into the theme of 2025, which is physical AI.
This is AI systems integrating with the physical world. And Jensen has said in the past that physical AI will reshape $100 trillion worth of global industry.
So, this is the big takeaway from the presentation. It's about robotics.
And Jensen says "the 'ChatGPT moment' for general robotics is just around the corner."
He says over the next several years, the combination of agentic AI robots, autonomous cars and humanoid robots will become "the largest technology industry the world has ever seen."
Remember, Elon Musk thinks with the introduction of humanoid robots into the world, there will be "no meaningful limit to the size of the economy."
This all makes incremental surprises in daily economic data, the uptick in global bond yields, and parsing Fed communications on the next quarter point rate cut, seem relatively unimportant.
But just as the technology revolution of the late 90s, driven by internet adoption, drove a stock market and economic boom, there were shocks along the way (like the Asian Currency Crisis, Russian Default and the related failure of the hedge fund Long-Term Capital Management).
And with that, we have plenty of shock risks that warrant respect.
Among them, the one that could quickly get to a flashpoint is the bond market.
Remember, we looked at this chart in my Dec. 23 note (here).
As we discussed in that note, the big downtrend in the U.S. 10-year Treasury yield has broken. Yields have now moved 110 basis points higher, despite the Fed taking the Fed Funds rate 100 basis points lower.
And remember, the current Treasury Secretary, Janet Yellen, has left the bond market in a vulnerable position, by financing record peacetime deficit spending with short-term maturities.
That leaves incoming Treasury Secretary, Scott Bessent, with a third of the outstanding government debt to be rolled over this year, creating risks for rate volatility (a bond market attack) and “the potential for a financial accident.”
