Cathie Wood: "U.S. Economy Exiting 'Cyclical Recession,' AI-led Productivity Boom Ahead"

# ARK Invest's Cathie Wood Predicts End of Economic Downturn, Foresees AI-Driven Productivity Boom ARK Invest CEO Cathie Wood forecasts the U.S. economy is nearing the end of a "cyclical downturn" and anticipates an unprecedented productivity boom spearheaded by artificial intelligence (AI) and emerging technologies. According to Decrypt on October 12, Wood expressed on her podcast "In the Know" that technological innovation could more than double the growth rate of real Gross Domestic Product (GDP) from historical averages. This optimistic outlook comes amid weaker short-term economic indicators. "We are nearing the end of this [cyclical downturn]," she noted, adding, "The bad news is that we have to go through this process." Wood further elaborated via Twitter that the current economic crisis—a term she refers to as "the process"—might lead to a "deflation boom" by the second half of 2025. # Technology Innovation and Economic Growth Outlook Wood’s comments come as the stock market experiences its worst day since 2022, and the Atlanta Federal Reserve's GDPNow model suggests a roughly 3% decline in real GDP for the first quarter. Despite this, Wood argued that the U.S. economy is on the cusp of the most significant productivity gain in history, driven by technological advancements reshaping the economic landscape. ARK Invest has built its reputation by focusing investments on innovative technology sectors such as gene technology, autonomous technology, cryptocurrencies, and artificial intelligence. However, the ARK Innovation ETF has underperformed compared to the S&P 500 following substantial declines in 2022. Wood highlighted fiscal policies from the Trump administration, particularly citing the $4.5 trillion tax cut package passed by the House Budget Committee and the extension of the existing $1.9 trillion tax cuts, as potential catalysts for economic boom. She also remarked on changes occurring in the cryptocurrency and digital asset sectors following the departure of SEC Chair Gary Gensler, calling it a "digital asset revolution." # Public Skepticism Despite Wood’s optimistic forecast, public reception has been largely skeptical. Comments on her YouTube channel revealed doubts about her economic outlook and investment strategies. One viewer criticized, "She was once a visionary, but now seems to be denying reality," while another remarked, "Have you seen her 5-year performance? It's dreadful." Criticism also emerged regarding the scientific understanding of the Trump administration. One comment noted, "Trump misunderstood a study on genetically modified rats as 'transgender rat research.' As someone investing in biotech’s future, I hope she critically views the administration's statements." Questions about the effectiveness of tax cut policies and tariff strategies were also raised. One user claimed, "Tax cuts will be funded by tariff revenues, targeting America's major trading partners. But this strategy will ultimately fail." Although Wood remains confident in her bullish outlook, many continue to question her economic analyses and investment tactics. Nevertheless, she persists, asserting, "This bull market will be one of the strongest in history," firmly believing that technological innovation will drive both economic growth and deflation.