S&P Global Ratings flags AI bubble risk within 3 years
The US and China are locked in a high-stakes AI competition, but a new S&P Global Ratings report says things could get rocky soon.
There's talk of an "AI bubble burst" in the next three years, which might mean big layoffs and trouble for global investors.
The ripple effect could hit Asia-Pacific countries like South Korea, Taiwan, Malaysia, and Australia especially hard.
US market driven China state-led AI
The report points out that the US takes a market-driven path in AI, while China leans on state-led coordination and steady power supplies.
US tech restrictions are slowing down China's chip-making but also pushing local innovation.
Both sides are running into challenges with expanding data centers and figuring out the best way to develop new AI models, open-source or proprietary, adding even more uncertainty to the mix.