Sebastian Mallaby, senior fellow at the Council on Foreign Relations, described artificial intelligence as an “A-plus technology but a C-minus business model” during a panel discussion hosted Wednesday by the Milken Institute, an independent economic think tank.
Holding back from labeling the massive capital expenditures fueling AI infrastructure expansion a “bubble,” Mallaby cited “circular financing” as a troubling sign within the context of the broader economic and social transition that the AI revolution foreshadows.
“This is not just an experiment with technology, this is an experiment in capital markets,” said Mallaby, which he believes ultimately tests the depth and durability of global appetites for AI-related debt.
“Can you raise h...