BIS warns AI investment boom could trigger a global recession

The Bank for International Settlements (BIS) cautions that the current wave of AI‑related capital spending, now exceeding a trillion dollars, mirrors historic investment bubbles that ended in recessions. The report highlights that the five largest technology firms are set to spend over $1 trillion on AI infrastructure, a level that already outpaces their earnings and free cash flow, forcing some to raise debt. BIS warns that the collective over‑exposure, compounded by opaque private‑credit financing and circular ownership arrangements between hyperscalers, chip makers and AI labs, could quickly reverse, pulling back funding and damaging construction firms, chip producers and AI research entities.

In the Balkans, consultants from MeteorIT in Serbia echo the concern that while AI technology is real and potentially productivity‑enhancing, many companies lack the competence to apply it effectively. They note that large tech firms granting unrestricted AI tool access have run into budget overruns without corresponding productivity gains. MeteorIT aims to help small and medium enterprises bridge the skills gap, underscoring the broader challenge of translating AI hype into tangible economic benefits.