Is the AI Boom Driven by Real Demand or Circular Spending?

I have been thinking about a pattern in the AI boom: chipmakers invest billions in AI labs, then those labs spend heavily on computing infrastructure supplied by the same chipmakers or closely linked cloud firms. The resulting transactions are reported as AI revenue growth, even when some of the capital appears to be moving in a circle. That does not mean AI has no value. Adoption is growing and productivity gains are real. But valuations and some deal structures may be running ahead of the revenue that AI products currently generate. The more useful question may not be whether AI is a bubble, but how much of today’s spending reflects sustainable demand versus an infrastructure race. Where do you stand: is a major correction coming, or is this simply how every major technology build-out looks in its early stages?

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