AI credit boom fuels growth—and raises bubble fears
Credit investors are pouring billions into AI ventures, driving the sector to historic growth. At the same time, analysts warn that the capital influx resembles past tech bubbles. Bloomberg reports that AI companies are using high-yield debt and convertible instruments to raise funds, enabled by low interest rates maintained by central banks. While this financing fuels rapid development, it also increases the risk of defaults and investor losses if the sector slows. Industry insiders are increasingly voicing concerns about sustainability.
The AI sector’s reliance on credit highlights rapid maturation—but also signals financial fragility if expectations aren’t met.
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