Could AI Trigger A Financial Crisis?

In remarks on Monday to the National Press Club, SEC Chair Gary Gensler, after first displaying his math chops—can you decipher "the math is nonlinear and hyper-dimensional, from thousands to potentially billions of parameters"?—discussed the potential benefits and challenges of AI, which he characterized as "the most transformative technology of our time," in the context of the securities markets. When Gensler taught at MIT, he and a co-author wrote a paper on some of these very issues, "Deep Learning and Financial Stability," so it's a topic on which he has his own deep learning. The potential for benefits is tremendous, he observed, with greater opportunities for efficiencies across the economy, greater financial inclusion and enhanced user experience. The challenges introduced are also numerous— and quite serious—with greater opportunity for bias, conflicts of interest, fraud and platform dominance undermining competition. Then there's the prospective risk to