In the first quarter of 2026, the US economy grew at a 2.1% annualized rate. That number alone made it look like the economy is on a positive track.
On September 16, the Federal Reserve raised interest rates for the first time since 2023, a quarter-point hike to a range between 3.75% and 4%. The vote was unanimous, and officials penciled in one more hike before year's end. Chairman Kevin Warsh didn't mention AI spending once in his press conference and he didn't need to. Nearly every dollar hyperscalers have poured into data centers over the past three years was borrowed, invested, or justified against a backdrop of cheap money. The market environment is now completely different.
