The Long and Unwinding Road
I have written about the bull market in Data Center creation in the Midwest where cheap land and proximity to water is a driver. The DC race is on all over the country as big tech forecasts exponential demand for their services.
The AI trade is on and everyone is in it. The joy of rapid information deployment is that everyone can be in the same trade in no time. Prices may vary of course but who cares when you are in a sure thing.
Now the creation of these data centers everywhere leads to a pop in area employment during construction and build out. But then it falls to about 100 jobs per site after completion. Even those jobs will be reduced as AI does what it does best, replacement. Goldman predicts a loss of up to 300 million jobs by 2030. But who’s counting. Certainly no one who has the wonder trade on.
So that leads us to the great unwind. If great expectations for AI fall just a little bit then the trader/investors who owns it will have to unwind it before everyone else who owns it, well you know.