We can add financial advisors as a profession that will be replaced by AI. This is the claim made by noted investor Anthony Pompliano.
Here we see a target on Wall Street, at least the employees who work at many of the largest firms.
The entire investing landscape is changing. We see these institutions offering 5% or 6% returns (if they are able to generate any). We are already seeing trading applications far exceed that. This is not relegated simply to crypto. Traders all over the world might be able to automate their trading activities, generating higher returns than what the financial services industry provides.
As for the plight of financial advisors, they could go the way of the switchboard operator.
AI is taking over and finance is a prime target.
Faster. Cheaper. Better.
That is the selling point of AI. When it comes to humans, there is really no contest. A financial advisor simply does not have the bandwidth to compete.
Let us think about what a financial advisor does. He or she takes one's personal information and matches it against what markets are doing. The idea is to design a financial plan that will meet individual needs. The personal data is the basis for the conclusion drawn.
In other words, we are looking at data in, plan out.
Why couldn't an AI program do that? As mentioned in this video, Pomp and his team already developed that.
This is a worthwhile video to watch.
AI is start directing people where to go with their finances. It is the agentic age coming to life.
Here is a screenshot of what is what Pomp brought out.
Notice the key word there: FREE
The wealth creation from AI is going to be monumental. There are a number of layers to consider when looking at this.
Ultimately, returns are going to dwarf what they were historically. I wrote a great deal about the upcoming economic singularity. What we are seeing here is a prime example of that.
I define the economic singularity as a 10x of the growth rates over the past 100 years. That averages out to roughly 3% although we drifted below that over the last two decades.
That would mean an annual rate of 30% or greater. What type of return should one get if the economy is expanding 30% annually.
AI is going to factor into that. Here we see how extractors could be removed from the equation. At the same time, the data accumulation and speed which it is processed means that outsized returns are available.
For now, it is a dream to many. That said, there should be the rise of expectations. Crypto is showing the path with many tokens offering returns much bigger than Wall Street traditionally offered.
From an employment perspective, things are bleak. The key is to move from the labor side of the equation to capital. The latter is going to consume more of the economy. People who position themselves here will end up getting ahead.
