BIS warns of the risk of an AI bubble: core company valuations are high, risk premiums are clearly compressed, and revolving financing conceals hidden dangers

Comparing news, the Bank for International Settlements (BIS) said in its annual economic report that AI optimism has supported global growth and risky assets over the past year, accelerated semiconductor procurement, data center construction, and power infrastructure investment, and kept financial conditions relaxed. But as AI investments scale up, risks are extending from stock market valuations to corporate bonds, private credit, and supply chain finance.

BIS warns that the valuation of AI core companies is already at a high level, and the market's implied long-term profit growth rate is significantly higher than historical benchmarks. At the same time, risk premiums for large US stocks have been significantly reduced, indicating that risk compensation received by investors is being reduced. If the return on AI investment falls short of expectations, or if inflation forces interest rates back up again, the stock market will face more intense revaluation pressure.

BIS also specifically mentioned that lack of transparency in AI financing amplifies risk. Some chip vendors and cloud vendors form revolving financing through equity investments, long-term procurement commitments, computing power leases, and data center leaseback arrangements, and some assets may also be at risk of repeated pledges. If the equity market is drastically adjusted, corporate credit risk will be re-assessed, credit spreads may widen, and the financing environment will be further tightened.