People, including on this team, keep asking me, with varying degrees of enthusiasm or apprehension, when the AI bubble will burst. I’ll tell you what I tell them: If I knew this, I would make a life-changing bet in the market, using as much as I can, and then, after I made my money, I would retire to a beach somewhere. Maybe run a cat sanctuary, who knows.
What I can tell you is that I read with interest a story in Bloomberg this morning: “Wall Street CEOs and big money managers divided on AI risks. » The story itself is a summary of what was said at the 2026 Global Financial Leaders Investment Summit in Hong Kong. Here’s what caught my attention: The CEO of Pacific Investment Management Co. — that’s PIMCO, the legendary bond company — told listeners that there was going to be a slowdown in the AI market “and then things were going to fall apart.”
“What we don’t know is how prices and the economy will evolve.”
The CEO of PIMCO – his name is Emmanuel Roman, but it’s his work that counts here – estimated that the development of AI could create $2 trillion in financing needs over the next five years. The entire U.S. bond market is worth about $12 trillion.
It’s not just PIMCO that is calling for caution. Apollo Global Management, which recently discussed a $40 billion chip deal with SpaceX, also warns of AI risks. Apollo Chairman Jim Zelter told analysts today that while he expects the company to use “significantly more computing power in the future” and that AI will improve rapidly, significant uncertainty remains. “What we don’t know is how prices and the economy will evolve.”
This is what I mean when I say “I don’t know.” I do, however, think something big – PIMCO’s Roman cited US rate hikes, war or the Eurozone crisis as potential triggers – could turn this market upside down. We are not in a go-go-go zone now. Maybe that will change; It’s possible that Anthropic’s IPO will be a success and it will be like someone showing up to a party running out of beer with a 24-pack. But as more and more people express caution — and especially after the Situational Awareness disaster — the best part of the party might be over.
Gn bussni
