AI Borrowing Binge Rattles US Markets
Companies are pouring more than $100 billion into AI equipment as data center construction more than quintuples and skilled-trade labor costs climb.
- The Federal Reserve faces a growing challenge in curbing inflation because the massive AI-related investment boom appears largely resistant to higher interest rates, The New York Times reports.
- Construction spending solely for data centers reached an annual rate of $85 billion in August, driving up inflation by increasing demand for computer chips, construction materials, and skilled labor.
- The construction industry faced a shortage of roughly 439,000 workers as of late 2025, with average hourly earnings of electrical contractors rising 7.1% in August from a year earlier.
- Electrical contractors with 12 trucks who once competed for kitchen remodels now face rigorous financial requirements, including greater bonding capacity and working-capital reserves, to win substation work.
- Economists estimate AI-related spending could exceed $10 trillion through 2032, potentially forcing The Federal Reserve to raise rates further and disproportionately pressuring rate-sensitive sectors such as housing and consumer credit.
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AI boom is changing the global debt market: companies borrow trillions of dollars despite high rates In the US, corporate bond issuance has reached $1.69 trillion, largely due to AI <p>financing. SpaceX and Broadcom are preparing new multi-billion loans.</p>
Appetite for financing the infrastructure boom is put to the test after months of record issues of securities
Artificial Intelligence borrowing plunges over 50%—Where are the returns?
ALBAWABA – The race to build artificial intelligence infrastructure is facing tougher questions about money, as global AI-related borrowing fell to $23 billion in September—less than half August’s total...
The volume of new debts raised by technology companies to help finance high-cost investments in artificial intelligence (AI) fell sharply last month, as investors reassessed the sector's risks after months of accelerated debt. Exclusive material for subscribers. To have full access, access the link of the subject and register.
Jefferies’ Chris Wood Sees ‘Massive Capital Destruction’ in AI
The most likely long-term outcome of the AI boom will be massive capital destruction in the US, with market share going to cheaper open-source Chinese models, according to Jefferies Financial Group Inc.
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