AI Datacenter Capex: A Hidden Economic Prop?

This article explores the massive impact of AI datacenter capital expenditure on the US economy. The author argues that AI datacenter capex could reach 2% of US GDP in 2025, fueled by internal cash flows, debt issuance, equity offerings, and more. While this investment masks underlying economic weaknesses, preventing a deeper recession, it also leads to capital reallocation, starving other sectors of investment and triggering mass layoffs. The author warns of unforeseen consequences from this massive investment in rapidly depreciating technology.