The US government has shut down, people have lost their jobs and paychecks. At the same time, trillions of dollars are flowing into AI. A contrast that shows where the true center of the economy lies.
Congress failed to approve the budget and the classic shutdown arrived. Nearly one million federal employees were sent home without work, and another seven hundred thousand continue working but without pay for now. Agencies are closing, contractors are losing projects, and people are losing income.
Take a look at the chart below. It shows where the capital flows today.
At the center is OpenAI with a valuation of half a trillion dollars and right next to it Nvidia at 4.5 trillion. Around them orbit Microsoft, Oracle, Intel, AMD, and dozens of smaller players. Everything is interconnected with investments, chips, and cloud infrastructure.
Nvidia plans to invest up to one hundred billion into OpenAI, Oracle signed a three-hundred-billion cloud contract, and Microsoft is pumping in more capital. Just a few arrows on the diagram and you can already see where the hundreds of billions are vanishing.
AI is no longer a toy but the engine of the entire economy. Estimates suggest that up to one hundred million jobs in the US could disappear over the next decade. Companies simply don’t need that many people anymore.
Chatbots handle customer service, algorithms replace accountants, models manage legal research and even write code. Ordinary people are losing purchasing power. They have fewer jobs or worse-paid jobs and therefore spend less.
It is not only about the shutdown. We already see the labor market declining. Industry is declining. Shipping is declining. The Dow Jones Transportation Index, the traditional barometer of the American economy, is declining. Consumer strength is declining.
And while the real economy slows down, capital in the AI sector is pouring left and right, with firms inflating each other in the process. One company invests hundreds of billions into another, which immediately reinvests in chips and cloud, and valuations soar. Money that once supported consumption and industry now circulates within the closed loop of tech giants.
The state cannot pay its own employees, yet the AI sector is running at full speed. Consumption declines, companies report record profits, and capital concentrates in just a few firms. On one side there is shutdown and furlough, on the other a perpetual motion machine around AI that swallows gigawatts of electricity and rewards shareholders.
We can laugh at it: when the government shuts down, the chatbot will still serve you. But it is also a warning. If the state fails to find a way to respond, the decline in the purchasing power of ordinary people will become inevitable.
For investors, however, the signal is clear. AI is not a hype bubble, it is the infrastructure of the new economy. The state may stand still, but capital around Nvidia, OpenAI, and Microsoft keeps flowing. And that is a trend that cannot be ignored.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Investing in financial markets involves risks. Always conduct your own analysis before making investment decisions.