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In 2026, global spending on artificial intelligence is supposed to reach close to half a trillion dollars. Nvidia, which makes chips for pretty much all of the big AI companies, recently became the first business to be valued at $5 trillion. In the quest for superintelligence, investors have poured hundreds of billions of dollars into building data centers that will eventually demand more power than many major American cities.

The investment is based on the promise that AI might one day concoct miracle drugs, program anything, automate everything—inventing out into infinity. But is that day just around the corner? A decade away? And will it ever generate enough profit to make up for this staggering amount of investment?

In this episode of Radio Atlantic, we talk to the Atlantic staff writer Charlie Warzel about whether the AI boom is actually a bubble. Does the promise of AI ultimately match the enormous investment? And if not, is the American economy in a new stock-market 1929? A dot-com 2000? A financial-crisis 2008? And if it is, would the Trump White House see the AI giants as too big to fail? What happens to ordinary Americans if the bubble bursts? If it doesn’t—if AI succeeds in paying for itself—does that come at an even greater cost?

The following is a transcript of the episode:

[Music]

Hanna Rosin: The amount of money invested in AI these days is astonishing—almost unfathomable. You might even need AI to truly comprehend it.

Recently, Nvidia, which makes chips for pretty much all of the big AI companies, became the first business ever to be valued at $5 trillion. That’s trillion with a t. When I went in to type 5 trillion into my phone calculator just to see what it would look like—’cause, like, that’s what non-trillionaires do for fun—it couldn’t even display the whole number on the screen.

Nvidia is part of an elite group in the tech industry called the “Magnificent Seven”: seven companies that make up more than a third of the S&P 500. That’s Alphabet, Amazon, Apple, Meta, Microsoft, and Tesla, all of which have made some pretty hefty investments into AI in the last few years.

Charlie Warzel: Honestly, the amount of money and energy that’s being poured into this is staggering. Global spending is projected to hit $375 billion this year. And in 2026, the figure is supposed to go up to close to a half a trillion dollars.

Rosin: That’s Charlie Warzel, who covers tech at The Atlantic and who recently wrote about this topic with our colleague Matteo Wong.

Warzel: There’s really no way to put in context, without sounding ridiculous or super vague, just how much money is going into this. We’re talking in historic terms.

Rosin: Back in 2019—a couple of years before OpenAI launched ChatGPT—its CEO, Sam Altman, spoke to a group of industry observers. He was asked how exactly OpenAI plans to make money as a business. And here’s what he said.

Sam Altman (from StrictlyVC): The honest answer’s we have no idea. We have never made any revenue. We have no current plans to make revenue. We have no idea how we may one day generate revenue. We have made a soft promise to investors that once we’ve built this sort of generally intelligent system, basically, we will ask it to figure out a way to generate an investment return for you. (Audience laughs.)

Rosin: In the years since, AI has come a long way. It’s crept into our emails, our term papers. It’s made its way into medical-image analysis, large data sets that companies use to make projections, our late-night musings.