Tyler Cowen examines the impact of transformative AI technologies on market perceptions, particularly through the lens of US bond yields. An analysis of bond market reactions around major AI model releases in 2023 and 2024 reveals significant movements, especially for long-term securities. The data shows that both median and mean yields for long-term Treasury bonds, Treasury Inflation-Protected Securities (TIPS), and corporate bonds dropped and remained lower for several weeks following these events. This suggests that market participants may be adjusting their growth expectations downward. The findings align with a consumption-based asset pricing model, indicating that the decline in yields corresponds to lower anticipated consumption growth and a reduced likelihood of extreme economic scenarios, such as existential risks or a post-scarcity economy. Interestingly, changes in the uncertainty surrounding consumption growth do not appear to influence these yield movements as strongly. This analysis is rooted in a new working paper by economists Isaiah Andrews and Maryam Farboodi, adding a quantitative perspective to the ongoing conversation about AI's economic implications.