SEC Chair Gary Gensler is worried about the impact of AI on financial market stability, basically on the ground that it can increase the risk of herd behavior as financial actors rely on the same limited subset of LLMs, trained themselves on similar data sets. Now, he's talking about AI risks, but he really means "cognition oligopoly risks." And those can't exist in competitive AI supply markets, and AI supply markets aren't competitive because buyers misunderstand AI.

Yes, if everybody rents the same handful of misunderstood and badly deployed AI brains, they'll think similarly and panic at the same time. But lack of AI diversity is a symptom of lack of market diversity, not a cause. A much more interesting conclusion: you can't get alpha from somebody else's AI.

And the contrapositive is where the money will be.

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