Update
AI Financing Loop Expands with Overseas Investment
The AI sector's financing loop is drawing billions of dollars from overseas investors, echoing pre-2008 financial crisis concerns. According to Bloomberg, over half of AI firms' investment from 2021 to 2025 came from other AI firms. This includes Microsoft and Nvidia's $15 billion stake in Anthropic and Nvidia's $100 billion commitment to OpenAI. The article also mentions Morgan Stanley's projection of AI-related debt reaching $1.5 trillion by 2028, highlighting the complexity and potential risks associated with this financing structure. The article notes that foreign investors control about 20% of US equities, similar to the levels seen before the 2008 financial crisis, which could lead to current-account imbalances. Investors are questioning how much of a company's sales come from customers it has also funded, given the significant amount of AI-related debt projected by Morgan Stanley.