What’s Next for The AI infrastructure CapEx Boom

As an SMB investor and observer dedicated to tracking the seismic impact of AI on knowledge workers and small businesses, one recent trend has become impossible to ignore: the seemingly unprecedented levels of AI Capital Expenditures (CapEx) which is at $400B and counting, constituting more than 1% of U.S. GDP.

It’s not just the sheer scale of investment in data centers, chips, and energy infrastructure; it’s how quickly this spending is translating into towering market valuations and a rapid, intense capitalization concentration among a handful of key players. This dynamic has triggered a vital question: Are we witnessing a unique 21st-century phenomenon, or are there parallels in history that can illuminate our current trajectory?

This article takes a deep dive into these three critical factors—CapEx, valuation, and concentration—by seeking lessons from historical periods of immense industrial and technological investment. By examining the past behavior of equity markets during similar high-capital eras, it will help put the current AI landscape into perspective.

In conclusion of this article, I offer some predictions for what the next five years may hold for AI adoption and this new economic architecture.

Check out the full 4800 word article here: https://open.substack.com/pub/flamingcontrarian/p/the-ai-infrastructure-boom-railroads?r=2tgfp&utm_campaign=post&utm_medium=web&showWelcomeOnShare=true