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AI boom or doom?

Oct 20, 2026 | Blog

Artificial intelligence continues to reshape industries, influence markets, and create new opportunities for investors. But with rapid innovation comes important questions about its long-term impact. In this piece, Capital Group shares insights from its economists and portfolio managers, exploring the potential opportunities, risks, and what the future of AI could mean for investors.

“When French philosopher René Descartes wrote “I think, therefore I am,” he likely didn’t envision a future dominated by artificial intelligence. Yet as AI transforms society, company executives and inquisitive investors are wrestling with similarly fundamental issues about where the technology is headed and how events may unfold.

Against this backdrop, we sat down with our economists and portfolio managers to answer your biggest questions about the risks and rewards of AI. Here are the highlights:

1. Will the AI stock market boom end with a bust?
I am an optimist about how AI will play out over the next several years. I believe we’re in a real boom and that AI is an unstoppable trend. Are certain stocks overpriced? Sure. Could the AI build-out slow? Absolutely. But could the entire AI economy turn out to be as overpriced as the internet sector was in 1999 or early 2000? I don’t think so. says Mark Casey at Capital Group.

2. How long could the AI boom last?
We’re in the midst of a huge AI investment cycle states Cheryl Frank. Enterprise adoption may be an unstoppable freight train, even if companies rely less on cutting-edge frontier models over time. There could be a 20-year effort to implement AI across industries and use cases, which makes data center growth and financing central to the story.

3. Could opposition to data centers slow AI development?
The AI build-out may be more difficult to stop than investors realize. If we stopped building data centers today, it would hurt the United States’ competitive position and make the path toward artificial superintelligence bumpier, but it won’t stop the boom. Many projects have already been permitted and will likely get built regardless, so more capacity could come online for years says Michael Beckwith.

4. Will higher interest rates impact the AI build-out?
Bond investors are becoming more selective about financing AI-related projects says Shannon Ward, especially as 10-year U.S. Treasury yields have risen above 5.25% in early October. That relatively attractive risk-free rate combined with the ample supply of debt to fund the AI build-out means that investors can demand higher yields and more favorable terms when it comes to AI debt deals.

5. How worried should we be about AI doom scenarios?
I think we should be concerned but not panicked. Over the last few months, AI agents from OpenAI and others have gone rogue, with hundreds of agents coordinating to hack unsuspecting companies. These incidents highlight an alignment problem: AI models have become more capable but remain far behind on staying inside their sandbox says Jared Franz.

I don’t think AI will bring about an end to humanity, but we should be prepared for a world in which major hacks and other real-world harm become more common. Creating a so-called “kill switch” that quickly shuts down AI systems makes sense in case these models dangerously veer off course.”

Click here to read the full article from Capital Group.

As technology continues to evolve, so should the conversations surrounding your financial future. Understanding emerging trends is just one piece of building a financial strategy that aligns with your goals. We’re here to help you see the bigger picture and make informed decisions about your future.

Schedule a complimentary consultation to take a closer look at your current financial plan and explore opportunities to help you reach your goals.

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