Bank of America Warns AI Optimism Is Overheated: Markets Are Betting on an “AI Version of the WTO Moment”

BofA believes that current global corporate earnings expectations have clearly outpaced macroeconomic fundamentals, and the market is betting that AI will reshape the global labor market and boost corporate profit margins—much like China’s accession to the WTO did in its time. However, this logic still faces multiple risks related to demand, costs, and policy.