Gauge 3: Valuations and Strategic Moats

The AI economy isn’t coming. It’s already here.

In the first half of 2025, investment in AI infrastructure outpaced all U.S. consumer spending. Tech companies are now building the equivalent of an Apollo program every ten months, while data centers are drawing capital away from nearly every other sector.

As money floods into chips, servers, and substations, the “B word” is suddenly on everyone’s lips: bubble.

This week, Azeem Azhar, founder of Exponential View and one of the sharpest analysts of exponential technologies, joins Open Circuit to unpack the difference between a boom and a bubble. Azeem discusses his recent analysis on bubble dynamics, which established a dashboard for monitoring the health of the AI economy.

Azeem has spent the last decade chronicling how exponential technologies collide with the real world. And lately, that collision has been literal. Data centers are running into grid limits, power supply is the new bottleneck, and trillions in capital expenditures are reshaping capital flows across the economy.

Scott Clavenna, Latitude Media CEO and lead author of the AI-Energy Nexus newsletter, also joins as guest co-host to draw from his experience covering the telecom bubble of the 90s.

So where is this cycle headed? What’s on the other side of it? And what happens when exponential technologies hit the limits of steel, concrete, and electrons?

In this episode, we’ll check the gauges of the AI economy, and ask what it means for the energy economy. Plus, we examine the state of AI, if we’ll ever see energy’s AlphaFold moment, and whether we’re seeing the limits of computing scale.

Open Circuit is brought to you by Natural Power. Natural Power specializes in renewable energy consulting and engineering, supporting wind, solar, and battery storage projects from concept through financing. Discover how we're creating a world powered by renewable energy at naturalpower.com.

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