What if old models don’t apply in AI-era inflation? Ackman questions Fed’s rate hike

Billionaire investor Bill Ackman believes the Federal Reserve may have made a mistake by raising interest rates. He thinks that the usual link between higher rates, weaker demand and lower inflation may not work in the current AI-driven economy.

Ackman, the founder of Pershing Square, said the Fed’s decision to raise rates last week could be based on economic models that do not fully account for the huge investment being made in artificial intelligence.