Two markets, one buildout, one big gap
The AI capex boom is being priced twice — and the two markets doing the pricing disagree. That gap is the test.
The debt that will actually have to be repaid is buying the future as if it still has to be earned. Aldasoro, Doerr, and Rees, the BIS staff behind Bulletin No 120, identify the tension directly: equity prices have run far ahead of debt market pricing.
Most readers will hear "AI capex" and think of chips, data centers, and grid buildouts — and assume financing is a sideshow. The actual mechanism runs the other way. The next dollar of AI infrastructure is not coming from operating cash flow. It is coming from non-bank lenders — pension, insurance, and fund money that used to live on bank balance sheets, what the BIS bulletin calls private credit. The buildout has to clear two auctions: one run by optimistic shareholders, one run by lenders who price to be paid back.
When the two prices disagree by this much, markets are pricing different futures — and the gap signals which scenario the market thinks is more likely. The test is which one, and the receipts arrive as AI-firm earnings meet the size of the buildout. The machine does not need to fail — the financing just needs to overshoot what the earnings can service, one market being wrong being an inference rather than a certainty.