As large sums flow into artificial intelligence, former People's Bank of China Gov. Xiaochuan ZHOU urged officials to prepare for investment failures that he said could lead to a financial crisis.
At an Oct. 20 Bund Summit roundtable, ZHOU said some AI investments would succeed and others would fail, according to The Paper's account of his remarks. With substantial funding directed toward AI and its infrastructure, failures in some investments could cause financial turmoil, he said.
ZHOU called for research into the risk, contingency plans and policy tools that could be used if a disruption occurred. In a severe case, he said, authorities might need to provide broad support to the economy and rescue some financial institutions. He spoke about what might happen if investments failed.
Discussing the financial industry's AI-related investments, ZHOU identified three areas: models, computing capacity and data centers; AI applications; and supporting industries, including semiconductors, electricity and liquid cooling. He said applications were likely to make the largest contribution to productivity gains.
