Blackstone president Jonathan Gray warned that Wall Street is still underestimating the scale of disruption posed by Artificial Intelligence, according to comments published by the Financial Times on Oct. 18. Speaking at the FT’s Private Capital Summit in London, Gray said investors are discounting the technology’s potential to render entire industries obsolete. He added that assessing Artificial Intelligence risk and opportunity has become a priority in Blackstone’s process, telling the firm’s credit and equity teams to address the topic on the first pages of their investment memos.
Gray acknowledged concerns about frothy conditions, citing high valuations at loss-making Artificial Intelligence startups and circular arrangements among major players that have raised bubble alarms. He said misallocation of capital is likely, likening the moment to Pets.com in 2000. Even so, he argued that the sheer scope of the technology means the market may still be underestimating its power to demolish established models. He pointed to rules-based sectors as especially exposed, highlighting legal, accounting, transaction handling and claims processing as areas where the impact could be profound.
His remarks echo recent commentary from Amazon founder Jeff Bezos, who described the boom as an industrial bubble rather than a financial one. Bezos suggested that even if share prices fall sharply, the underlying benefits of the technology will endure. He noted investors often struggle to separate good ideas from bad amid hype, but maintained that Artificial Intelligence is real and set to transform every industry.
Separately, PYMNTS Intelligence research underscores how perceptions are evolving on the workforce front. The report found a gap between views of generative Artificial Intelligence’s broader impact and personal risk, with most workers recognizing a systemic threat of job displacement while fewer fear for their own roles. Taken together, the investor caution, executive optimism about long-term value and worker sentiment suggest a complex transition in which capital may be unevenly allocated, but the technology’s disruptive effects on legacy, rules-based businesses could be both deep and durable.
