AI Investors Are Showing Fatigue, And That’s Bad News For Everyone
AI investors are reportedly feeling “fatigued” at throwing so much money at the technology. And, that should be terrifying for all of us.
Now, I’m not saying that because I love AI. Frankly, I think this entire phase/bubble was stupid. I’ve lived through a couple now, and each investment bubble gets progressively dumber. But, with this iteration of AI speculation madness, the results from a crash will likely be catastrophic.
Bloomberg’s reporting on this shows that investors have forked over $300 billion in chasing AI profitability. Now, the market still has some takers. (Keep in mind people are still trying NFTs in the year of our lord 2026.) But, investors want some protections and better terms for them to cash out in the event this is all successful.
Before forking over part of $25 billion or more, they want the principal on that debt paid before maturation. Or, even more drastically, proof that data center leases will be paid even if a tenant defaults on the agreement. Imagine trying to lease any other property with these restrictions? These people truly play by a different set of rules.
“At the end of the day, these companies are selling a lot of debt and they’re going to have to pay up to borrow,” Robert Tipp, head of global bonds at PGIM Fixed Income told the outlet. “The market, after a spectacular narrowing in corporate spreads to historical tights, is seeing a wall of worry piled up before it.”
AI Investment Fatigue setting in?
AI was everywhere from Super Bowl commercials to bus stops over the last 12 months. I’ve heard the name Claude this year more than I have for actual people in my lifetime. But, the anxiety is beginning to creep in among the investment class.
But, that’s not stopping the big tech giant’s powering all of this hype. After all, a good deal of the American economy is being propped up by massive investments in AI technology. Hence why we should be concerned about a bubble environment. If this thing were to pop, It would be like the 2008 housing crisis on steroids.
Spending all this money on data centers and chips to make them operational sound solid in theory. After all, In the in the future these technologists envision, everyone on earth will basically use AI for tasks. What happens when that theory bumps up against real life experience for a lot of people living in the United States?
It seems like every week that goes by gives us another study where people report being dissatisfied with AI being shoved and everything. Or, Confusion at why they would want to use AI to do any of these tasks to begin with?
Couple all of these realities with the supply chain volatility introduced by the current United States government and you have a pile of kindling ready for a single match or ember to set the entire thing off. And, since the entire United States economy, and a lot of the world economy is tied up in this technology, we’re on the ride whether we like it or not.
Personally, as someone who remembers the housing and automotive markets going up in flames during the 2000s, I look forward to seeing how anything survives unscathed. AI might be “here”, but how long will it stay that way?
(featured image: Tri-Star Pictures)
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