The AI bubble won’t survive this question | Ed Zitron

The AI industry currently operates as a massive, debt-fueled bubble characterized by circular financing rather than genuine market demand. Hyperscalers like Microsoft, Amazon, and Google artificially inflate revenue by funding AI labs like OpenAI and Anthropic, which then spend that capital on compute services provided by the same hyperscalers. This cycle serves primarily to funnel money to NVIDIA while justifying massive capital expenditures to shareholders. Despite claims of rapid expansion, actual data center construction remains stagnant, with few projects reaching completion. The industry’s reliance on unlimited debt and the absence of a clear path to profitability for AI startups create a fragile ecosystem. A collapse is inevitable once the market realizes that these companies are merely feeding themselves money, as the current valuation models cannot survive the eventual reality of stalled infrastructure and uncollectible debt.