Concerns about immediate AI-driven job losses are premature. True labor displacement requires a lengthy phase-in period for broad enterprise adoption, building new application layers, and integrating AI into existing workflows and processes, which takes significant time.
Unlike the speculative internet bubble, today's market is supported by an 'early cycle earnings backdrop' following a recent rolling recession. Capital is not just chasing long-term AI dreams but is also flowing into classic cyclical winners with strong current earnings, indicating a more fundamentally sound recovery.
Beyond the AI-focused headlines, the S&P 500 Equal Weight Index's new highs show market strength is broadening. Capital flowing into formerly lagging areas and strong earnings growth for the median stock suggest a genuine early-cycle economic expansion, not a concentrated tech rally.