{"id":994429,"date":"2026-08-11T13:50:25","date_gmt":"2026-08-11T13:50:25","guid":{"rendered":"https:\/\/www.europesays.com\/us\/994429\/"},"modified":"2026-08-11T13:50:25","modified_gmt":"2026-08-11T13:50:25","slug":"ai-boom-likely-stopped-recession-top-economist-david-rosenberg-says","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/us\/994429\/","title":{"rendered":"AI Boom Likely Stopped Recession, Top Economist David Rosenberg Says"},"content":{"rendered":"

The AI boom is soaking up investor cash, staving off a recession, and showing signs of faltering, David Rosenberg<\/a> says.<\/p>\n

AI is “sapping the momentum out of the rest of business capital spending,” the veteran economist<\/a> said during the latest episode of the “Excess Returns” podcast.<\/p>\n

Rosenberg estimated that 50% of all corporate investment is going toward AI-related items<\/a>, and that segment of spending is growing around 18% annually in real terms, while capital spending in the “old economy” is declining.<\/p>\n

He was responding to Richard Bernstein, the global head of macro at Janus Henderson Investors, saying that, similar to how the energy sector was “starved for capital” during the dot-com boom, money is flowing into building data centers<\/a> instead of residential homes, fueling the housing shortage and affordability crisis.<\/p>\n

Rosenberg, known for calling<\/a> both the dot-com and housing crashes, said the economic backdrop is very different now than during the internet bubble.<\/p>\n

The Rosenberg Research president, previously Merrill Lynch’s chief North American economist, said that “nobody was talking about a K-shaped economy<\/a> back then. The consumer was really strong across the board. You can’t say that today.”<\/p>\n

“When you strip out the AI spend, the economy is actually very weak<\/a>,” Rosenberg said. He pointed to the housing sector contracting and weakness in auto sales and non-tech manufacturing.<\/p>\n

“Without the AI boom, we probably would be in a recession<\/a>,” he added.<\/p>\n

The US economy grew at an annualized 1.5% in the second quarter of this year, down from 2.1% in the first quarter. It unexpectedly lost<\/a> 23,000 jobs in July, upending the Wall Street consensus that it would gain 85,000 jobs.<\/p>\n

Just like in the lead-up to the 2008 financial crisis, Rosenberg said he expects debt investors to spot warning signs<\/a> before stock investors do.<\/p>\n

“I think the credit market will lead the ultimate rolling over of this AI trade<\/a>,” he said, pointing to early red flags such as rising financing costs and spreads on credit default swaps<\/a> (CDS), a form of insurance against loan defaults, widening “pretty dramatically.”<\/p>\n","protected":false},"excerpt":{"rendered":"The AI boom is soaking up investor cash, staving off a recession, and showing signs of faltering, David…\n","protected":false},"author":3,"featured_media":994430,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_share_on_mastodon":"0"},"categories":[12],"tags":[112157,24996,398555,64,398553,121352,398552,79,398556,6308,8042,149845,33110,4368,10405,1409,398554,67,132,68],"class_list":["post-994429","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-affordability-crisis","tag-ai-boom","tag-auto-sale","tag-business","tag-business-capital-spending","tag-david-rosenberg","tag-dot-com-boom","tag-economy","tag-excess-return","tag-housing-shortage","tag-job","tag-k-shaped-economy","tag-macro","tag-podcast","tag-recession","tag-sign","tag-top-economist-david-rosenberg","tag-united-states","tag-unitedstates","tag-us"],"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@us\/117077201720264507","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/994429","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/comments?post=994429"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/994429\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media\/994430"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media?parent=994429"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/categories?post=994429"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/tags?post=994429"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}