Washington. Amidst the ongoing turmoil in stock markets around the world, veteran investor and billionaire Ray Dalio has given a big warning regarding Artificial Intelligence (AI). Dalio, founder of Bridgewater Associates, says the classic AI bubble may be about to burst. He has cited rising interest rates, huge debt and huge investment on AI infrastructure as the main reasons behind this.
According to the report, during the Forbes Global CEO press conference in Singapore, Dalio said that loans are being taken on a large scale for investment in the AI sector. After this, if interest rates continue to rise, pressure on companies and investors may increase. He indicated that the market is reaching a stage where the risk of financial crisis may increase.
According to Dalio, the possibility of the US Federal Reserve increasing interest rates is also a matter of concern for the market. Due to higher rates, investors may need to raise cash by selling their properties. He said Indian investors are keeping an eye on global developments as the Indian stock market has been among the underperformers among major markets since 2025.
Dalio mentioned rising bond yields. According to him, the 10-year yield reached 5.368 percent, which was reported to be the highest level since 2002. Rising government debt, inflationary pressures from the war and huge capital requirements of AI infrastructure could keep real interest rates high. According to analysts, there is still uncertainty regarding the expectations of AI increasing productivity and reducing inflation. If companies get the benefits of investment late, the pressure on capital expenditure may continue till 2028. Meanwhile, the Indian stock market also recorded a huge fall on Thursday. Sensex fell 1,045 points to close at 71,593, while Nifty fell 371 points to 22,231. This led to a huge reduction in investors’ wealth.
