Big Tech uses complex financing for AI investments, spreading risk

Big Tech companies are not solely funding AI investments with their own capital, but are using complex structures involving banks and private investment firms. This spreads the risks of a potential AI bubble across more parties. This financial maneuvering means that if the AI bubble bursts, the impact will be felt by a wider range of investors, including European institutional investors who have significant holdings in US markets. Concerns about overinvestment in AI are growing, with many fund managers identifying an AI bubble as a major investment risk. The Financial Times reported that US tech companies have issued over $200 billion in bonds to finance AI initiatives.