Wall Street is driving the AI surge. But millions of Americans could be in the blast zone if the bubble bursts

Core Insights - The AI boom is significantly driven by Wall Street's investment in infrastructure, including data centers and computing facilities, rather than just consumer-facing technologies like chatbots [1][3] - There are concerns about over-investment and potential bubbles reminiscent of the early 2000s tech boom, as analysts warn of slowing returns [2][6] Investment Trends - Wall Street is increasingly financing large-scale AI data-center projects, with firms like Blue Owl Capital transitioning from traditional lending to providing $10 billion to $30 billion for AI infrastructure [4] - A notable example includes Blue Owl's $30 billion financing package for Meta's Louisiana data center, which involved $3 billion from its clients and additional borrowing [4] Market Dynamics - The demand for AI infrastructure is projected to reach nearly $3 trillion by 2028, with only about half of that expected to be funded by tech companies' cash flow, indicating a significant financing gap [5] - This gap has led to increased participation from private-credit firms, banks, and asset managers in AI infrastructure financing [5] Historical Context - Concerns about a potential bubble are heightened by historical parallels to the late-1990s telecom boom, where excessive investment was made based on anticipated demand that did not materialize [6] - Goldman Sachs CEO David Solomon highlighted the cyclical nature of technology investment, noting that excitement can lead to significant capital formation, but the growth trajectory may not be linear [7]