Wall Street legend issues stern warning: US stocks must hit new lows, AI may eliminate 50% of humanity.

Source: Jin10

Billionaire hedge fund manager and founder and chief investment officer of Tudor Investment, Paul Tudor Jones, issued a stern warning on Tuesday that even if President Trump lowers his aggressive tariffs, the US stock market will inevitably hit new lows.

"It's clear to me. Trump has locked in tariffs. The Fed is sticking to no rate cuts. This is bad for the stock market," Jones said on CNBC's "Squawk Box". "We are likely to drop to new lows."

"He will adjust the tax rate back to 50% or 40%, no matter what. Even if he does this... it will be the largest tax increase since the 1960s," the widely followed Jones continued, "so you can subtract 2%-3% from economic growth."

Last week's GDP report showed that ominous clouds are gathering over the U.S. economy: the first quarter GDP was -0.3%, marking the first negative growth since the first quarter of 2022. Jones believes that the stock market has not yet found a bottom due to the continued deterioration of macroeconomic conditions.

Federal Reserve Chairman Powell stated that he expects policymakers to wait for the impact of trade policy to become "more clear" before making further adjustments. As of Tuesday, the pricing in interest rate swaps indicates that the Fed will make three rate cuts of 25 basis points each before the end of the year, with the first expected in July.

Jones said: "Unless they are really dovish, really really cut rates, U.S. stocks are likely to fall to new lows. When we hit new lows, a tough day will begin, which may prompt the Federal Reserve to take action, prompting Trump to take action. Then we will get some kind of reality."

Jones became famous for predicting the stock market crash of 1987 and profiting from it.

In addition to concerns about the trade war and the market, Jones is also deeply unsettled by the development of artificial intelligence, believing that the threat of AI to humanity is imminent.

Jones said while sharing his insights from a recent exclusive technology conference that although artificial intelligence can be a "force for good" in health and education, experts at the conference believe that "artificial intelligence clearly poses an imminent security threat to humanity in our lifetime."

As part of its apocalyptic warning—similar to recent statements by Elon Musk and BCA Research—Jones warned, "There is a 10% chance that artificial intelligence will kill 50% of humanity within the next 20 years."

Jones was vague about the specific details of their arguments but mentioned "biohacking" and "weapons."