There's an argument I hadn't seen before.
From MarketWatch, October 21:
BlackRock Chief Executive Larry Fink doubled down on the importance of building data centers to the health of the U.S. economy, saying not pushing ahead could be inflationary.
“About two-thirds of the U.S. economy is capital expenditures right now on technology, whether it’s cloud or whether it’s AI, whether it’s just a capex of making sure you’re competitive,” said Fink, speaking to Bloomberg on the sidelines of the Berlin Global Dialogue conference on Wednesday.
“If we slow down the build out of this technology, I think it really does jeopardize the economy. It means we’re not going to build these. It means we’re building elsewhere,” he said, noting that Canada, India or Abu Dhabi could become alternatives.
“If we don’t build out these data centers, it is actually more inflationary because the cost to compute is so high right now. And the faster we can build up more data centers, the more compute we have, the faster we can bring down the cost,” he added.
Hyperscalers in the U.S. alone are talking about $7 trillion to $9 trillion that’s needed to finance that building and keep the U.S. in a leading position on AI, he said.
That type of funding, on top of financing the federal deficit, is pushing up the term premium — the extra return investors demand to hold longer-term Treasurys — which is bound to keep rising, he said....
....MUCH MORE
