PIMCO CEO Emmanuel Roman warns AI market will "break"

The warning lands from an unusual direction. PIMCO is a bond house, not a venture fund, and it has been instrumental in the AI trade — among the financiers behind the first CoreWeave chip-based financing in 2023, with $2 billion in paper gains from $29 billion in Meta bonds meant to support the AI buildout, and $4 billion of SpaceX bonds bought last month. That history is why a public warning from its CEO reads differently than caution from a skeptic with no position.

Meanwhile the debt keeps coming. Meta drew $58 billion in orders for an offering expected to be $15 billion to $20 billion, Oracle said Monday it would need another $20 billion in bonds on top of existing commitments, Alphabet is selling €6 billion (about $6.7 billion), and Microsoft sold $25 billion — its first bond sale in a decade. That appetite is a sign the market is not at its top, while reports from China say its AI bubble burst some time ago and Wall Street banks are lining up to finance $63 billion in debt from Anthropic, which is not even a hyperscaler.

Apollo Global Management is urging caution too: president Jim Zelter told analysts he expects society will use "dramatically more computing power in the future" and that AI is improving quickly, but that how pricing and economics will evolve remains unknown. The conclusion is hedged — something major could flip this market, and Anthropic's IPO could yet restart the party, but with more voices expressing caution, the best part may be over.