If We Are in an AI Bubble, What Happens if it Pops?

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KQED

Politics, News, News Commentary

4.6 • 656 Ratings

🗓️ 5 November 2025

⏱️ 53 minutes

🔗️ Recording | iTunes | RSS

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Summary

“AI may not simply be 'a bubble,' or even an enormous bubble. It may be the ultimate bubble,” writes tech journalist Brian Merchant. In the first half of the year, AI contributed to 1.1% of GDP growth and eight tech companies are now valued at $1 trillion or more. While investors are giddy at the pace of growth, many economic analysts are more sober. We get to the bottom of the bubble and what might happen if it pops. Guests: Charlie Warzel, staff writer, The Atlantic. Warzel is also the author of "Galaxy Brain," a newsletter about the internet and big ideas. - he co-authored the piece "Here is How the AI Crash Happens" Brian Merchant, tech journalist, writes the "Blood in the Machine" newsletter, author, "Blood in the Machine: The Origins of the Rebellion against Big Tech; his most recent piece in Wired is "AI is the Bubble to Burst Them All" Learn more about your ad choices. Visit megaphone.fm/adchoices

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0:35.3	From KQED. Welcome to Forum. I'm Alexis Madrigal.
0:40.3	Bubbles are a real facet of a capitalist economy. We've seen them time and again for hundreds of years, actually.
0:47.3	In our century, the most disastrous bubble was in mortgage-backed securities and the shoddy loans that they were made of.
0:55.0	But of course, the most famous local example is the dot-com bubble and bus, which left its mark on San Francisco.
1:01.0	In retrospect, and even for some observers and participants, the coming of these collapses was obvious.
1:08.0	Things just could not go on that way forever. And for the last year, the massive
1:13.6	investments in AI have felt like that. Companies are spending unbelievable, unprecedented amounts
1:20.6	of money and sucking up wild amounts of energy to build out data centers in hopes of winning the AI race, whatever that is.
1:30.3	Perhaps even more troublingly, the big companies have become involved in all kinds of financial
1:35.4	schemes to disguise or downplay how much money they're really spending.
1:40.2	If you live through the Great Recession, get ready because we're going to use the word
1:43.6	securitization at least once and probably trenches several times to you've been warned.
1:49.4	Here to trigger us, we're joined by Charlie Wartzel, who's staff writer at The Atlantic, host
1:54.0	of the upcoming podcast Galaxy Brain, which is debuting next Friday.
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