AI is about to become a huge part of the US economy: average annual AI capital expenditure (capex) is estimated at around 3.6% of US GDP during 2025-32, according to a report by SBI Funds Management.
That's not just bigger than the dot-com era; it even tops the railroad boom from way back in the 1800s.
This wave of AI spending could seriously shape how the US grows during 2025-32.
AI borrowing raises long term costs
Tech giants like Amazon, Microsoft, Alphabet, and Meta are pouring money into building out AI infrastructure. Gartner says global AI spending could hit $2.67 trillion by 2026.
But there's a flip side: so much borrowing for these projects is making long-term borrowing more expensive and raising some financial concerns.
Plus, as investors worry about regulations and sustainability issues in AI, some are moving their money to places like India instead.