B&D Update October 8, 2025: Economic Resilience in the Age of AI

In 2025, the U.S. economy is being reshaped by massive corporate investment in artificial intelligence (AI). This trend is not only redefining market dynamics but also revealing deeper concerns about economic stability and long-term productivity.

AI Investment: A Lifeline for Economic Growth

Despite predictions of a slowdown due to rising tariffs and geopolitical tensions, the U.S. economy has remained afloat thanks largely to unprecedented capital expenditure in AI infrastructure. According to Harvard economist Jason Furman, AI-related investments accounted for 92% of GDP growth in the first half of 2025, with the rest of the economy growing at a mere 0.1%. [WinBuzzer]

This surge in spending has helped stave off recessionary pressures, with some economists suggesting that without it, the U.S. might already be in a downturn. However, concerns are mounting about the sustainability of this investment cycle. Rising borrowing costs and the risk of an AI bubble—similar to the dotcom bust—are prompting caution. [www.forbes.com] [Investopedia | MSN]

Will AI Deliver Real Productivity Gains?

While AI is being adopted across sectors—from finance and healthcare to manufacturing and logistics—its productivity impact remains uneven. Long-term projections are more optimistic. However, achieving these gains will require strategic leadership, workforce adaptation, and continued investment in infrastructure and training.

Looking Ahead

The U.S. economy is at a crossroads. AI investment has provided a critical buffer against recession, but its long-term value will depend on real productivity gains and sustainable business models. As investors and policymakers navigate this complex landscape, the key will be balancing innovation with resilience.

We remain committed to investment diversification and maintaining a long-term focus. We will continue to monitor this closely.

The Bond&Devick Team