BOFA WARNS AI BOOM COULD FOLLOW HISTORIC BUST CYCLES

BANK OF AMERICA WARNS THAT THE AI INVESTMENT BOOM IS SHOWING SIGNS OF A CLASSIC CAPITAL-CYCLE RISK: SURGING SPENDING, INTENSIFYING COMPETITION AND FALLING PRICES.

HYPERSCALER CAPITAL EXPENDITURE EXPECTATIONS HAVE JUMPED FROM $330 BILLION TO $1 TRILLION, EQUIVALENT TO ROUGHLY 3% OF U.S. GDP.

MEANWHILE, AI TOKEN PRICES HAVE FALLEN AROUND 50% SINCE SUMMER, RAISING CONCERNS THAT GROWING USAGE MAY NOT TRANSLATE INTO SUFFICIENT REVENUE.

THE KEY RISK: AI TECHNOLOGY COULD SUCCEED WHILE INVESTORS SUFFER FROM OVERINVESTMENT AND DECLINING RETURNS. ...