Federal Reserve Vice Chair for Supervision Michael Barr has highlighted the potential risks and benefits of artificial intelligence (AI) in the economy and financial stability. Speaking before the Council on Foreign Relations, Barr noted that the attributes that make AI attractive, such as speed and automaticity, also present risks. He discussed two hypothetical scenarios for AI's impact: one where AI leads to incremental productivity gains across industries, and another where AI transforms the economy by extending human capabilities. Barr emphasized the need for financial institutions and regulators to understand and responsibly integrate AI into their operations, while also monitoring its broader impact on economic and political institutions.