Economic TimesLean R·
AI spending boom could trigger sharper downturn than dotcom crash: Professor Aswath Damodaran
Valuation expert Aswath Damodaran warns the AI boom's massive capital expenditure, largely debt-funded, could lead to a more painful downturn than the dotcom crash. He notes tech giants are shifting to capital-intensive models, unlike the equity-funded dotcom era. This extensive infrastructure investment, coupled with "big market delusion" and overconfidence, risks widespread economic fallout if projections falter, potentially causing significant job displacement.
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