> Further, unlike during the dotcom crisis, most of this spending is not driven by debt.

Unfortunately, that's not the case. Between the big 5 (Microsoft, Meta, Amazon etc.) they're spending more than $600 Billion in 2026! They don't have that much cash lying around so they're selling bonds!

That's debt!

Not only that, they're increasing the bond sales in Europe! I assume that means they're tapped-out in the US!

All this off-the-books stuff, despite being legal but shady, is still debt! Debt has to be paid by someone.

To sum it up: the AI buildout is a highly leveraged, debt-fueled expansion, not an organic, cash-funded software cycle... this will not end well!

Bond sales are pretty normal for companies, AI or not. Leverage is in very low ratios compared to the dotcom era.

Much of the dotcom era telecom expansion depended on debt and projected future demand, but the resulting networks were so overbuilt that only about 2% of North American long-distance capacity was being used. Falling prices left numerous operators unable to service their debts. Today’s AI expansion is led mainly by already-profitable companies with large existing revenues and cash flows. Microsoft alone generated $136B in operating cash flow during its 2025 financial year while spending $65B on capex. It held $95B in cash, compared with total debt of about $43B. That means a disappointing return on AI investment would reduce profits, cash reserves, and shareholder value, rather than making these companies insolvent.