Please stop asking me when the AI bubble will pop

People, including members of this staff, keep asking me with varying degrees of excitement or trepidation when the AI bubble will burst. I will tell you what I tell them: If I knew that, I would make a life-changing bet on the market, levered up as far as I could, and then, after I made my money, go retire on a beach somewhere. Maybe run a cat sanctuary, who knows.

What I can tell you is that I read with interest a story in Bloomberg reporting on Wall Street CEOs and big money managers divided over AI risks. The coverage is a roundup of remarks delivered at the 2026 Global Financial Leaders Investment Summit held in Hong Kong, China. What caught my attention is that Emmanuel Roman, chief executive officer of Pacific Investment Management Co. or PIMCO, the legendary bond firm, told listeners that there is going to be a downturn in the AI market and then things are going to break.

The astronomically expensive AI buildout has swamped debt markets, making it harder to raise cash, yet more debt is still coming with strong buyer demand. For instance, Meta drew $58 billion in orders for a bond offering expected to be $15 billion to $20 billion, according to Bloomberg. Oracle stated it would need another $20 billion in bonds on top of its existing steep commitments. Alphabet, Google parent company, is selling €6 billion or about $6.7 billion of bonds, and even Microsoft recently sold $25 billion of bonds for the first time in a decade.

Stock photo for illustration only, not from the actual event

Emmanuel Roman, the CEO of PIMCO, has estimated that the AI buildout could create $2 trillion in financing needs over the next five years, compared to the entire US bond market total of about $12 trillion. I am harping on PIMCO because it has been instrumental in the AI trade, having been among the financiers behind the first CoreWeave chip-based financing in 2023. The firm made a quick $2 billion in paper gains from $29 billion in Meta bonds meant to support the AI buildout last year, and bought $4 billion of SpaceX bonds last month. When PIMCO is publicly sounding the alarm after selling a bunch of its AI debt, that carries significant weight.

It is not just PIMCO urging caution. Apollo Global Management, which recently discussed a $40 billion chip deal with SpaceX, is also warning of AI risk. Apollo president Jim Zelter told analysts that while he expects society to use dramatically more computing power in the future and that AI is improving quickly, significant uncertainty remains regarding how pricing and economics will evolve.