In the language of economics, there are two terms used to describe events that bring great changes to the economy. “Megatrend” is a term used to describe major structural changes that transform the global economy over the long-term. And “revolution,” as in “the industrial revolution,” is a megatrend so massive, so pervasive, and so long-lasting, it changes the very fabric of culture and society.

Artificial intelligence (AI) clearly represents a “megatrend;” but I believe it is much more than that. I believe economic historians will be writing up the 2020’s as a decade that witnessed a new industrial revolution, and quite possibly the most impactful such revolution we’ve ever seen.

#-ad_banner-#In the first industrial revolution, the birth of steam locomotion revolutionized transportation. Since then, we’ve seen how the assembly line enabled modern rates of production, how digital electronics radically changed the ways we communicate and entertain ourselves, and how the internet revolutionized… well… pretty much everything. Now, it seems we are on the verge of a fifth great breakthrough in industry.

Within just a generation of the internet’s invention, we appear to be standing at the beginning of the very beginning of what may in fact be the greatest revolution of all. The one that will propel modern society into fulfilling what until now has only been possible in the vague imaginings of science fiction writers. The rise of AI is best defined now as a megatrend, for it impacts any tech industry that deals with large amounts of data. But it will soon be changing core aspects of our daily lives, too.

The Power Of Growth
Artificial intelligence is already bringing changes to several key sectors of the economy. In health care, it will change the way our health is diagnosed, and our health care distributed. For example, tech giant International Business Machines (NYSE: IBM) recently purchased four health companies that work in diabetes care. Together, these companies give IBM access to over 300 million clinical records that it will analyze, using AI and machine learning, to not only improve diabetes care but to potentially find a cure.

AI will also change the way we drive our cars. While fully driverless cars are not yet on the market, they do exist and are getting “smarter” all the time. The front-runner, Google’s Waymo, has a fleet of autonomous cars that have driven 3 million miles on public roads, 1 million miles of which were achieved in just 7 months. Driverless cars are no longer a pipe dream.

We will also see major changes in things like how we buy life insurance, the way home loans are approved, how we get financial advice, and how, when, and where we go to war. It is hard to estimate how much AI will add to the global economy, since it is not only a new industry in its own right, but it also helps existing companies improve the performance of current services.

One recent estimate suggests that, once AI is fully absorbed into the U.S. economy, we could see “gross value added” figures (which approximate GDP) increase from a baseline of 2.6% today to 4.6% by the year 2035, a growth of 77%. In terms of today’s dollars, that is an increase to the U.S. economy of over $15 trillion, more than the total annual output of India and China combined! And that’s just here at home. The global growth picture is many times that. In the figure below, we see estimates of value creation for various world economies from AI being adopted into the economy.

Source: Accenture and Frontier Economics
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It has been estimated that AI industry revenues will grow to $127 billion by 2025, from $2.1 billion in 2015, implying a compound annual growth rate (CAGR) of 51%. Such estimates are naturally subject to a huge degree of inherent uncertainty, but the tone of analyst expectations is optimistic.

And so am I. I’m bullish on AI and it is one of the key reasons I decided to launch Extreme Tech Profits. I’m not alone. Assets under management for AI and AI-related exchange-traded funds are now estimated to be over $25 billion, a massive increase from a mere $59.8 million in a handful of funds just five years ago. But as I said, we are at the very beginning of the beginning of this major change-wave in our world’s economy.

And in my most recent issue, I shared another great AI company to complement our current position, which is doing great so far (up nearly 15% in a little over a month). This is a company that recently held an analysts’ day conference that was so impressive, every analyst in attendance raised their price targets on the company.

No less than five hedge funds initiated new positions in the stock last quarter, including one that specializes in innovative tech like AI. It knows the field so well that its main fund is up 108% over the past 18 months. When it buys shares of this stock, so should the rest of us.

Editor’s Note:
Cash In On The New Tech Revolution
Last year, the technology sector had the highest returns of all market sectors — a whopping 34.3% versus 21.8% for the S&P 500. That makes tech the leading sector in six of the past eight years.

But in truth, the real story for tech has yet to be written. That’s why we recently launched our latest service, Extreme Tech Profits, with Dr. Tom Carr.

In fact, it is not a stretch to imagine that in years to come, the only sector worth investing in will be technology.

If you’d like to learn more about how Dr. Carr and his research team are targeting the areas of artificial intelligence, cybersecurity, the cloud, the internet of things, robotics and more for MAJOR profits in the months to come, then you should definitely check out this brief transcript while it’s still available.