BPEA paper (23 Sep): US AI build-out $10.3tn over 2025-32, 3.63% of GDP a year, above the railroad boom

AI and technology · Commentary · 24 Sep 2026, 16:54

BPEA paper (23 Sep): US AI build-out $10.3tn over 2025-32, 3.63% of GDP a year, above the railroad boom

Stijn Van Nieuwerburgh (Columbia), presenting at the Brookings Papers fall conference on 25 Sep, projects $10.3tn of data-centre, power, network and chip investment and finds the risk migrating off balance sheets into joint ventures, private credit, securitisation, SPVs and leases that hinge on a few tenants' credit; he calls it not yet systemic but hard to observe.

Sources: brookings.edu

AI and technology · Commentary · 24 Sep 2026, 22:14 · Update

Oracle sends force-majeure notice on 2.45 GW Stargate campus in New Mexico (24 Sep); gas pipeline slips to 1 Feb 2027

Oracle notified developer Blue Owl that it may delay payments if Project Jupiter (the $165bn campus behind Stargate) misses its 2028 start; the Energy Transfer gas line is ~6 months late after permit denials, and the fuel-cell air permit is due by 23 Nov. Oracle says the project is on schedule; shares fell 4-7% intraday. Oracle spent $55.7bn on infrastructure in FY2026, $23.7bn more than it generated, and has cut ~21,000 jobs this year.

Sources: techcrunch.com, cnbc.com

AI and technology · Commentary · 26 Sep 2026, 10:11 · Update

Goldman (25 Sep): top five US hyperscalers' AI capex to rise 54% to $1.2tn in 2027, ~35% funded by bonds

Goldman Sachs expects Amazon, Alphabet, Microsoft, Oracle and Meta to spend $1.2tn on AI infrastructure in 2027 (consensus $1.1tn), after ~$750-800bn in 2026 and $405bn in 2025, then $1.4tn in 2028. It sees ~$400bn of investment-grade issuance in 2027, about 35% of capex (26% in 2025, 33% in 2026).

Why it matters. The biggest US tech firms are expected to borrow about $400bn in bonds next year to fund AI data centres, adding to the supply pushing long-term interest rates up.

Next. Big-tech third-quarter results from late October will show whether 2027 spending plans match this.

Sources: finance.yahoo.com, bloomberg.com

Markets · 27 Sep 2026, 19:07 · Update

Oracle's 2056 bonds yield above 8% for the first time (24 Sep); its credit default swaps at a record

Oracle's 6.7% bonds due 2056 moved above 8% on 24 Sep and its CDS hit a record, as the US 10Y passed 5.1% and Oracle sent a force-majeure notice on the Project Jupiter data centre; about $18bn of Jupiter loans trade below face, and ~$120bn of Oracle bonds would leave investment-grade indexes on a downgrade to junk.

Why it matters. Oracle borrows heavily to build AI data centres; when its long-term borrowing cost passes 8% and insurance against its default hits a record, markets are questioning whether the AI build-out can keep being financed with debt.

Next. Any rating-agency decision on Oracle, and whether other data-centre borrowers' bonds follow.

Sources: tipranks.com, news.google.com