By Mark MacCarthy
Publication Date: 2025-11-24 13:10:00
Chapter 12 of his groundbreaking 1936 treatise states: The general theory of employment, interest and moneyEconomist John Maynard Keynes wrote: “When the capital development of a country becomes a by-product of the activities of a casino, the job is probably poorly done.” Commentators have begun recycling this famous indictment of casino capitalism (like here and here) in discussions of today’s AI bubble.
Policymakers will not tell the private sector what investment decisions to make. Casino capitalism is safe. Institutions and individuals with money will continue to use their wealth for their pet projects – and lose their investment if they guess wrong.
However, there is no longer any serious question as to whether the casino economy has created an AI bubble. In almost every way, investments in AI infrastructure far exceed any foreseeable returns. JP Morgan estimates that the projected $5 trillion global investment in AI infrastructure will require…
