Goldman Sachs Chief Economist Warns AI Investment Boom Will Eventually Slow Down
Goldman Sachs chief economist Jan Hatzius has warned that the current surge in artificial intelligence (AI) investment will not continue indefinitely. Speaking at Goldman's Communacopia & Tech conference, he noted while AI spending is expected to be productive and contribute to future productivity growth, it will eventually slow down as new technologies transition from an 'investment phase' to an 'exploitation phase.' According to PwC’s Global Data Centre Outlook, global investment in AI infrastructure could reach $31.6 trillion by 2050, with annual data center capital expenditures rising sharply over the same period. Major tech firms like Meta (META), Google (GOOG), and Microsoft (MSFT) are heavily investing to support their AI ambitions. Hatzius emphasized that while his baseline assumption is optimistic about AI's long-term impact on productivity growth, there will be challenges as investment volumes decline after peaking.
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Topics: AI investment capital allocation economy Goldman Sachs