Sep 16, 2026 · 31 min
AI’s infrastructure boom collides with tighter capital
Bloomberg Surveillance TV: September 16th, 2026
The episode connects uncertain rate policy and oil prices to a deeper question: whether markets can finance AI’s rapid expansion without intensifying risk.
- 1Higher rates and oil prices could pressure economic growth, equity valuations, and corporate earnings.
- 2Stuart Russell argues that opaque AI systems require behavioral red lines, not liability rules alone.
- 3Jim Zelter describes private capital’s expanding role as AI infrastructure strains debt capacity and investment-grade funding.
Don't miss
Stuart Russell argues that corporate liability cannot address AI loss-of-control risks and calls for behavioral red lines.
The brief
Gina Martin Adams and Jonathan Ferro assess how higher rates, Federal Reserve uncertainty, and oil prices could reshape growth, equities, and corporate earnings.
AI researcher Stuart Russell warns that opaque large language models create loss-of-control risks that corporate liability cannot solve, making behavioral red lines essential.
Apollo president Jim Zelter discusses the enormous financing needs of AI infrastructure and why private capital is increasingly filling the gap alongside public markets.
The financing challenge extends beyond raising money: AI-related debt may strain issuance capacity, compete for investment-grade funding, and increase refinancing and mortgage costs.
The episode’s central tension is whether AI-driven economic change can keep attracting capital as borrowing constraints tighten and markets confront new safety risks.
What was said on this episode
36 statements · 14 positive · 17 negative · 2 mixed · 3 neutral
Rates will rise, while stocks rise longer term amid short-term volatility.
“Rates are going higher. Stocks are probably going higher longer term, but a little bit of volatility in the short run.”
Listen at 2:47
Stocks will likely experience volatility during the fall.
“It is September. That's the only month of the year in which you normally see stocks fall. So we will likely see volatility this fall.”
Listen at 2:54
Extraordinary investment is driving GDP growth and stock and bond-market conditions.
“the fact that we have extraordinary investment occurring and that is driving GDP growth is what's really driving overall conditions in both the stock and the bond market.”
Listen at 3:27
U.S. capital spending is experiencing its largest boom in at least 150 years.
“we're in the midst of the largest capital spending boom in at least 150 years. of US history.”
Listen at 3:50
Higher oil prices will probably reduce consumer demand.
“we probably will see demand destruction on the consumer side as a result of higher oil prices.”
Listen at 4:32
Higher diesel prices will cause some demand destruction.
“we will see some demand destruction.”
Listen at 4:48
Technology-driven capital spending will not slow unless the Fed tightens policy.
“That's not likely to experience any sort of slowdown unless the Fed does start to tighten policy to force a slowdown in the capital investment to some degree.”
Listen at 5:15
Economic growth will slow somewhat going forward.
“we will see a little bit slower growth going forward.”
Listen at 5:29
The Fed probably should not have loosened policy in 2025.
“in 2025, they probably should not have loosened policy to accommodate the doge sort of cuts that were happening at the federal level.”
Listen at 5:35
The Fed should remove 2025 policy accommodation and normalize rates.
“Now we need to take back that insurance that was put into the marketplace in 2025 just to normalize policy rates to be in line with what growth and inflation conditions.”
Listen at 5:44
Seventy-five basis points of hikes would probably affect consumer earnings.
“the 75 basis points of rate hikes to the degree that it impacts earnings will probably impact the consumer.”
Listen at 6:07
Fed tightening today would not affect earnings until late 2027 or 2028.
“If Fed policy tightens today, I wouldn't anticipate that really impacting earnings until late 2027 or 2028.”
Listen at 6:33
AI existential-risk concerns should slow investment.
“it should lead to a slowdown in investment.”
Listen at 7:04
AI investment probably will not slow through 2027.
“Does it lead to a slowdown in investment into 2027? Probably not”
Listen at 7:15
A slower AI development cycle could delay 2028–2029 investment.
“What a potential slowdown in the development cycle does is potentially slow down the 2028-2029 investment assumptions”
Listen at 7:31
AI deployment will continue despite a slower development pace.
“the AI train has left the station. We're going to continue to see. AI deployed”
Listen at 7:45
AI infrastructure spenders may monetize their investments faster.
“the companies that are spending money might actually see some monetization of that spending faster.”
Listen at 9:04
Large language models are enormous opaque systems whose operation is poorly understood.
“These are gigantic. black boxes. They have literally trillions or now even tens of trillions of parameters, and we have essentially no idea how they work.”
Listen at 11:55
Current large language models cannot reliably be stopped from unwanted actions.
“we have no way of stopping these systems from doing things that we don't want them to do.”
Listen at 12:22
The large-language-model technology path was mistaken and more funding will not fix it.
“the technology path itself was a mistake. And it's not going to get better by pouring more money into it.”
Listen at 12:35
Corporate liability will not deter loss-of-control risks from advanced AI.
“liability is not going to deter a company from incurring that risk”
Listen at 13:35
AI developers need pre-market safety requirements alongside post-harm liability.
“we need both requirements before a developer has market access. as well as liability after the fact.”
Listen at 15:01
AI systems should not self-improve without human authorization and oversight.
“we don't want AI systems that improve their own capabilities without human authorization and oversight.”
Listen at 16:13
AI systems should not advise terrorists on building biological weapons.
“We don't want AI systems that advise terrorists on how to build biological weapons.”
Listen at 16:21
Mainstream sports are unlikely to be disrupted by AI.
“that's probably unlikely going to get disrupted.”
Listen at 20:35
Sports franchises offer exceptionally low loan-to-value lending opportunities.
“the loan to value is exceptionally low that you can make a loan at versus other comparative industries.”
Listen at 21:22
Sports-franchise loans typically represent 10–20% of asset value versus 50–70% elsewhere.
“You're loaning 10, 15, 20 cents on the dollar of value versus other industries, 50, 60, 70.”
Listen at 21:30
The unprecedented AI CapEx cycle will require every major financing source.
“The scale of this CapEx cycle is unprecedented. It's going to take any and all precincts, equity, public equity, private equity, private capital, investment-grade debt, and everything else in between.”
Listen at 22:40
Broadcom and similar companies are performing well regardless of the LLM winner.
“companies like Broadcom and the others are doing very, very well, notwithstanding who's the winner of the LLM race.”
Listen at 24:00
Apollo will continue pursuing financing opportunities with OpenAI and Anthropic.
“there's certainly financing opportunities for OpenAI and Anthropic that we want to certainly be front and center in, and we have been, and we will continue to do so.”
Listen at 24:47
AI equity investing offers convexity and tolerates high concentration.
“The equity, you have massive convexity. You don't mind getting very, very concentrated.”
Listen at 25:05
No single asset class can finance all AI companies’ capital needs.
“there's no one asset class that's large enough to fulfill the aspirations of all these companies.”
Listen at 26:08
Large-scale capital access is a competitive advantage.
“having access to capital in scale is certainly a competitive advantage.”
Listen at 27:14
The economy and market have remained resilient despite high rates and oil prices.
“This economy and market have been resilient.”
Listen at 28:10
Higher capital costs are not currently slowing the economy.
“We're not seeing it right now.”
Listen at 28:39
Financing costs narrowing the CapEx cycle are a macro concern for investors.
“it's certainly a macro concern that investors have to think about.”
Listen at 28:49
Statements are attributed to the speaker as said on the episode and reflect their view at the time, not PodLume's. They are not advice.