Group 1 - The AI capital expenditure boom is projected to exceed $400 billion in borrowing this year, significantly higher than the $165 billion raised in 2025 [1] - Concerns are raised regarding the opacity of AI debt exposure, as funding methods like special purpose vehicles and off-balance-sheet financing may not be immediately visible to investors [2] - A Bank of America survey indicates a decline in fund managers advocating for increased capital spending, with only 20% supporting it, down from 34% the previous month [3] Group 2 - Prediction markets suggest a 20% probability of an industry downturn by the end of 2026, with specific triggers identified such as a 50% drop in Nvidia's stock price [4] - The net notional CDS outstanding for major tech companies has surged to nearly $10 billion, indicating a rush among investors to hedge against AI debt exposure [5]

Group 1 - Nobel Prize-winning economist Paul Krugman criticized President Trump's nomination of Kevin Warsh as Fed Chair, calling it "a big humiliation for the Fed" [1] - Krugman warned that the biggest risk to the dollar is not a rival currency but the potential for it to be replaced by "nothing," leading to a chaotic international monetary system [2] - He expressed skepticism about Warsh's record, stating he is a "hawk" only when a Democrat is in the White House and described the selection process for Fed Chair as degraded [3] Group 2 - Krugman noted that tariffs have raised prices by about 1% compared to what they would have been without them, ahead of a Supreme Court hearing on Trump's tariff authority [4] - He highlighted a $500-600 billion AI capital expenditure boom that is increasingly risky, with a shift from retained earnings to debt funding [5] - Goldman Sachs forecasts gold could reach $5,400 by year-end, driven by sustained central bank buying, while JP Morgan targets $6,300 with expectations of 800 tons of official-sector purchases in 2026 [5]