Please stop asking me when the AI bubble will pop
The author argues no one can predict when the AI bubble will burst, but warns that major financial players are increasingly sounding alarms.Summary
The article responds to persistent questions about when the AI bubble will burst, with the author stating that if they knew, they would make a life-changing bet and retire. The piece analyzes warnings from major financial institutions at the 2026 Global Financial Leaders' Investment Summit in Hong Kong. PIMCO CEO Emmanuel Roman warned of an impending AI market downturn where "things are going to break," noting uncertainty about how pricing and economics will evolve. The article highlights the massive debt financing for AI infrastructure: Meta drew $58 billion in bond orders, Oracle needs $20 billion more, Alphabet is selling €6 billion in bonds, and Microsoft sold $25 billion in bonds. PIMCO's CEO estimates the AI buildout could require $2 trillion in financing over five years, compared to the entire US bond market of about $12 trillion. PIMCO's warnings are significant because it has been instrumental in AI-related financing, including CoreWeave chip-based financing and Meta bonds, and recently sold much of its AI debt. Apollo Global Management also warned of AI risk. Despite these warnings, the author notes strong demand for Meta's bonds suggests the market hasn't peaked, but concludes that with growing caution, particularly after the "disaster at Situational Awareness," the best part of the party might be over.
(Source：The Verge)