If there’s an AI bubble, it’s hiding in the credit market

The post If there’s an AI bubble, it’s hiding in the credit market appeared on BitcoinEthereumNews.com.

To add a little balance to my “The New Era Isn’t a Bubble — It’s a Rerating of Reality,” it’s not that I’m naive to the risks. Every cycle hides its own fault line, and this one won’t be any different. However, I think the tail risk will persist more deeply in the credit market. There’s a strange echo in the market these days — a low-frequency hum of capital that seems to come not from factories or consumers, but from the future itself. The AI boom, once sold as a profit flywheel of endless efficiency, has quietly become the world’s most elaborate exercise in financial time travel — where tomorrow’s expected massive cash flow is used to fund today’s infrastructure in the hope that belief alone will bridge the gap. At first, it looked self-sustaining: hyperscalers like Microsoft, Amazon, and Google reinvesting their monstrous free cash into data centers, GPUs, and AI training clusters. But something shifted. Oracle decided to break ranks, levering itself to the hilt — a 500% debt-to-equity ratio — to join the hyperscaler Olympics. Suddenly, what was once a cash-flow-fed growth story began to smell like a credit-fed arms race. It’s as if a handful of companies are trying to build four nuclear plants’ worth of power and calling it innovation. The irony? The “AI miracle” has generated barely enough revenue to pay for college essay subscriptions and a handful of enterprise pilots. Yet $500 billion in annual capital expenditure needs financing — now. So the question that no one on CNBC seems willing to ask is: who’s actually footing the bill for this moonshot? The answer, increasingly, is debt. What used to be called venture capital has been reborn as venture credit. Banks, private funds, sovereigns, insurers — everyone is being enlisted to bankroll the AI gold…