Drawing lessons from history, is this wave of AI capital expenditure a boom or a bubble?

Deutsche Bank believes that historically, capital expenditure booms often end in collapse. The key factor that distinguishes prosperity from recession is the level of leverage (debt) involved. Historical experience shows that credit-intensive capital expenditure booms often lead to more severe recessions. Considering the current AI spending boom, which is primarily funded by the profits of large Technology companies in the USA rather than debt, this somewhat reduces systemic risk. However, the ratio of USA household net Assets to disposable income is at a historical high, and the concentration of the stock market has also hit a new high, which increases the systemic risk brought about by the transmission of wealth effects.

wallstreetcnFeb 28 05:03 ET

Express News | Shares of Semiconductor Companies Are Trading Lower in Sympathy With Nvidia, Which Reversed Amid a Possible Selloff After Reporting Q4 Financial Results

BenzingaFeb 27 13:32 ET

Express News | Shares of Major Semiconductor Companies Are Trading Higher in Anticipation of Nvidia's Q4 Earnings Which Are Scheduled to Be Reported After Hours Today. Additionally, Large AI Investment Announcements From Apple and Meta This Week May Be Buoying the...

BenzingaFeb 26 10:26 ET

ASE Technology Holding (ASX): Among Stocks That Could Skyrocket After Jensen Huang's Earnings Call

Yahoo FinanceFeb 26 10:18 ET

Morgan Stanley: Generative AI is expected to achieve positive returns this year, with revenue likely to exceed one trillion dollars by 2028.

Morgan Stanley indicates that 2025 may see the ROI critical point, with a gross margin of 34% marking the Industry's formal crossing of the break-even line; by 2028, the total revenue from generative AI is expected to approach 1.1 trillion dollars, with the ROI likely improving to around 67%, and several Technology giants like Amazon and Meta are expected to benefit from the AI wave.

wallstreetcnFeb 25 08:21 ET

ASE Technology Unit to Buy Equipment for 200 Million Yuan; Shares Down 3%

MT NewswiresFeb 23 22:38 ET