《Economic Intelligence Correspondent News on the 8th》Tech giants are scrambling for massive financing to build data centers and develop AI software. Former U.S. Treasury Secretary Rubin (Robert Rubin), speaking at the Greenwich Economic Forum, said that while the artificial intelligence (AI) investment boom could significantly boost productivity, it also harbors financial and social risks, and the market may be underestimating this potential impact.
Rubin served as Treasury Secretary in the Clinton administration from 1995 to 1999, a period marked by rapid internet development. He also served as co-chairman of Goldman Sachs.
Rubin is particularly concerned about the "circular risk" within the AI ecosystem: "Some AI giants have made massive procurement commitments, and many suppliers have borrowed money based on these commitments. What happens if these companies fail to fulfill their commitments, or if the borrowing firms run into trouble? This is what we call circular risk."
He believes that if one party fails to meet its commitments, it could lead to a "blow-up," triggering chain defaults, and the risk of such impact cannot be ignored.
*Billionaire Novogratz: AI Is in the Biggest Bubble of Our Lifetime*
However, another guest at the same event, Michael Novogratz, founder of Galaxy Digital, believes AI is currently in "the biggest bubble of our lifetime," and the speculative frenzy will continue to heat up, making it still worthwhile for investors to participate.
He thinks that judging by price-to-earnings ratios, AI-related stocks are still cheap. "If you're not investing in AI, you might as well go home and stick your head in a bucket of ice water." (rc)
Rubin served as Treasury Secretary in the Clinton administration from 1995 to 1999, a period marked by rapid internet development. He also served as co-chairman of Goldman Sachs.
Rubin is particularly concerned about the "circular risk" within the AI ecosystem: "Some AI giants have made massive procurement commitments, and many suppliers have borrowed money based on these commitments. What happens if these companies fail to fulfill their commitments, or if the borrowing firms run into trouble? This is what we call circular risk."
He believes that if one party fails to meet its commitments, it could lead to a "blow-up," triggering chain defaults, and the risk of such impact cannot be ignored.
*Billionaire Novogratz: AI Is in the Biggest Bubble of Our Lifetime*
However, another guest at the same event, Michael Novogratz, founder of Galaxy Digital, believes AI is currently in "the biggest bubble of our lifetime," and the speculative frenzy will continue to heat up, making it still worthwhile for investors to participate.
He thinks that judging by price-to-earnings ratios, AI-related stocks are still cheap. "If you're not investing in AI, you might as well go home and stick your head in a bucket of ice water." (rc)