Unhedged AI, shutdowns and shadow banks
63 snips
Oct 2, 2025 Rob and Katie dive into the looming government shutdown and its potential economic fallout. They explore the staggering investment in AI and question whether it's truly driving U.S. growth. Concerns arise over inflated AI valuations and their implications. Additionally, they shed light on the shadow banking sector, revealing its massive exposure risks. The discussion also touches on the unsettling reality of cyber attacks and the rise of Covid-19 cases, painting a vivid picture of today's market challenges.
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Shutdown Hides Crucial Jobs Data
- The US government shutdown halted key data releases, including the monthly payrolls report that markets and policy rely on.
- Robert Armstrong warns missing jobs data matters because the labor market is the central focus for monetary policy decisions.
Markets Ignore Political And Economic Risks
- Markets appear indifferent to political dysfunction and a weakening labour market, shrugging off downside risks.
- Both hosts note momentum can drown out macro risks until sentiment shifts sharply.
AI Buildout Is A Big Slice Of Growth
- AI-related investment accounts for a large share of recent US growth and corporate capex, driven by data centre builds.
- Robert Armstrong flags that capex from a handful of big tech firms equals about 1% of US GDP, concentrating growth risks.