US economy’s dependence on AI investments spooks analysts

Sharp swings in AI-linked stocks last week underscored unusually heavy reliance on artificial intelligence (AI) investment and the wealth it has generated in the US economy. AI-related spending has become so central to growth that a reversal could weaken both output and confidence.

“It’s certainly plausible that the economy would be in a recession (without the AI boom)’’, warned Peter Berezin, chief global strategist, BCA Research. Estimates suggest that investment tied to AI may have accounted for as much as half of inflation-adjusted US GDP…