Azeem Azhar

Railways relied on heavy debt and retail money and they were hit hard in the panic of 1873.

At the turn of this century, the telecoms companies had piled lots of cheap debt.

It was very clear revenues were not keeping up and many of them defaulted as revenues lagged.

In the case of the dot-coms, it was all about equity exuberance and the moment there was any sense of uncertainty, things collapsed.

Where we are today is that the big tech companies are minting cash and they have tons of it on their balance sheets because for many, many years, they've been producing products that we want, that enterprises want, and they've been doing so profitably.

So they are largely able to fund this from their own balance sheets.

Although over the course of the next four or five years, they will need to find external funding.

There's a funding gap of about one and a half trillion dollars that will need to be filled by private credit and other types of

infrastructures.

These types of things could be signs of fragility.

I don't think they are now.

But of course, this story isn't even.

There are companies like the NeoCloud, these very young startups that are building out data centers for AI.

And of course, there are some of the model companies themselves that are going to require an enormous amount of capital on an ongoing basis, but haven't had a chance to accumulate their own reserves.

And so you're going to start to see

more and more debt structures being used there perhaps they already are and you might have some covenant issues and other types of things to be concerned with but there is also some ballast today that didn't exist before because governments around the world have committed to AI as infrastructure and

there's more than a trillion and a half dollars of sovereign AI commitments.

That doesn't mean governments are going to stump up that cash, but it means they want that cash to be stumped up through public and private initiatives and other policy levers and incentives they can pull.

And also, we've got really big pools of capital that are now running around in sovereign wealth funds, which are quite tech lean forward.

And so they do provide some ballast and some access to capital as we continue with this build out.