Reuters Econ World Bubble talk – Part 2
Nov 12, 2025
Mike Dolan, Editor-at-large for Finance and Markets at Reuters, dives into the complexities of the AI investment boom. He discusses how national security is influencing this multi-billion dollar market and the challenges in measuring AI's economic impact. The conversation touches on inequality among consumers, the balance between job creation and disruption, and the potential risks of an AI bubble bursting. With insights on tech borrowing and geopolitical concerns, Dolan warns that the implications of AI extend far beyond mere finance.
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Episode notes
AI's Big Role In Recent US Growth
- AI spending was a major driver of US GDP growth in early 2024, but trade distortions cloud the exact share.
- The AI boom lifted investment, construction and stock wealth, supporting consumption via wealth effects.
Wealth Effects Mask Economic Inequality
- The AI rally concentrates gains among wealthier households who own most stocks, creating a bifurcated economy.
- Top earners' spending can mask stress at the lower end and hide real social damage from shocks.
AI Could Be The Economy's Next Backbone
- If AI reshapes productivity broadly, it could become the economy's backbone similar to the internet after the dot-com era.
- New tech waves like quantum computing may further transform infrastructure and economic trajectories.
