Robert Peston

And that's because we have spending on real capital, contracted services.

We also see profitability, right?

We see revenue growth when we look at enterprise planning, when we look at productivity tools, advertising.

And third and foremost, we also see that the hyperscalers have some pretty resilient balance sheets to fall back on.

Now, there's absolutely risk, right, as we approach the potential for an AI bubble, but it's not as cut and dry.

Let's try and link it to the Fed.

You know, why does it matter if the Fed does or does not cut interest rates again in December?

Yeah, it matters extensively, especially for a sector like tech because it's so rate sensitive.

When we look at discounted cash flows, we look at M&A activity, you know, the Federal Reserve was already flying partially blind back in October.

Very likely data is going to continue to be delayed or offset as we get into December.

And so that elevates the risk of a Federal Reserve misstep that's going to have an outsized impact on tech.

What's having an outsized impact on the economy is AI investment.

In many ways, it's underlying why we've seen GDP growth.

But I've been speaking to CEOs of late, and underneath the hood, they're saying this economy is weak.

And actually, we're seeing companies, Verizon this week, Amazon earlier, they are laying off tens of thousands of people in many ways to try and right-side their cost base.

Natalie, what are you actually hearing from the companies that lead right now?

What I'm actually hearing is that there's really two sides to the economy right now, right?

Now, when we talk about what's also sort of channeling economic growth, those AI evaluations, they're allowing higher income consumers to continue to drive growth in the economy.

And that's why it's so important as we get into 2026, we really have to talk about what does the tech sector look like and what does AI look like in the next 12 months.

Now, Natalie, I'm going to ask more of a complex one now, and I want your take just more broadly on when we're thinking about the AI bubble.