Innovation investor Cathie Wood on Monday rebutted Twitter and Square founder Jack Dorsey's theory on hyperinflation.
The founder and CEO of Ark Invest took to Twitter to expound upon her contrarian theory about deflation after Dorsey tweeted Friday evening that "Hyperinflation is going to change everything. It's happening." Wood estimates that her hypothesis will start to play out sometime after the holidays.
"Now we believe that three sources of deflation will overcome the supply chain-induced inflation that is wreaking havoc on the global economy. Two sources are secular, or long term, and one is cyclical. Technologically enabled innovation is deflationary and the most potent source," Wood said in the Twitter thread.
The ARK Innovation portfolio manager noted that training costs for artificial intelligence are dropping 40% to 70% per year, which she believes is a "record-breaking deflationary force."
"When costs and prices decline, velocity and disinflation - if not deflation - follow. If consumers and businesses believe that prices will fall in the future, they will wait to buy buy goods and services, pushing the velocity of money down," she added.
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