A torrent of AI-related capital spending is stirring bubble fears on Wall Street, but several major players argue the outlays are justified by rising productivity and long-run returns. In a client note titled “AI Spending Is Not Too Big,” Goldman Sachs economist Joseph Briggs said current data-center capex looks sustainable, asserting generative AI could ultimately generate up to $8 trillion in new U.S. revenue. JPMorgan Chase CEO Jamie Dimon similarly likened AI’s trajectory to the internet—bubble-prone in pockets but transformative overall.
Markets continue to reflect that optimism: despite recent pullbacks, U.S. indexes hover near records as AI-linked tech leaders drive gains. TSMC, a key supplier to Nvidia, reported record profits and reaffirmed secular semiconductor demand tied to AI, further boosting the sector. Still, caution persists. AAII’s latest survey showed a dip in bullishness and a majority calling stocks overvalued, and Goldman warned that today’s stock winners may not be tomorrow’s economic winners as costs fall and competition, regulation, and timing reshape returns. The firm expects AI investment to moderate after the build-out phase, but says the technology backdrop supports continued spending.
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