Everyone's celebrating the AI capex boom as a growth driver. But look closer at the math.
Yes, companies are pouring money into semiconductors and infrastructure. But where's it going? Asian chip manufacturing. We're importing the hardware.
Meanwhile, U.S. exports aren't moving much. So in GDP accounting—where imports subtract and exports add—we're seeing a drag despite all that investment.
It's one of those moments where the headline story ("AI boom!") and the actual economic mechanics don't quite line up. Spending doesn't always equal growth when the money flows offshore.
Classic case of enthusiasm running ahead of the spreadsheet.
Yes, companies are pouring money into semiconductors and infrastructure. But where's it going? Asian chip manufacturing. We're importing the hardware.
Meanwhile, U.S. exports aren't moving much. So in GDP accounting—where imports subtract and exports add—we're seeing a drag despite all that investment.
It's one of those moments where the headline story ("AI boom!") and the actual economic mechanics don't quite line up. Spending doesn't always equal growth when the money flows offshore.
Classic case of enthusiasm running ahead of the spreadsheet.
