Wall Street bank leaders say capital markets will continue to provide funding support for global AI infrastructure buildout; Morgan Stanley estimates cumulative spending over the next decade could reach $15 trillion.
Morgan Stanley CEO Ted Pick said Tuesday at the Global Financial Leaders' Investment Summit hosted by the Hong Kong Monetary Authority that the largest hyperscale cloud service providers could invest $800 billion to $1 trillion annually over the next 7 to 12 years.
Pick said that if you think of this as a nine-inning game, we are probably only in the second inning. He added that $10 trillion to $15 trillion is indeed a very wide range, but considering the need to build this infrastructure and keep pushing products forward, it is not an unreasonable amount.
Amid the wave of AI-driven advisory and financing demand, Wall Street financial institutions are benefiting, arranging debt and equity deals for market leaders including Meta Platforms Inc. and Anthropic PBC.
Goldman Sachs Group CEO David Solomon said that as investors assess the prospect of surging demand for AI and computing power, capital markets remain willing to absorb related financing needs.
However, Solomon also cautioned that technology super-cycles rarely move in a straight line upward.
Solomon said the main factor limiting deal sizes is the cost of capital, not whether funds are sufficient. "There will be ample financing in the market to meet these demands."
Pick said that over the long term, the returns from these investments will be sustainable. He estimated that productivity gains could add 50 to 70 basis points to U.S. real GDP annually.
Comments