Goldman’s top strategist just added hard numbers to his earnings-bubble warning
Peter Oppenheimer first flagged the risk that AI stocks were riding an unsustainable earnings boom this summer. He's done more math.
Goldman Sachs' chief global equity strategist, Peter Oppenheimer, has added hard data to his previous warning about an earnings bubble in technology stocks. In a new report titled "Competition for Capital," Oppenheimer ties the risk of an AI-driven earnings bubble to specific mechanisms, historical stress tests, and a near-term trigger that is already appearing in bond-market turbulence.
He cites capital spending among AA-rated technology issuers growing by 65% year-over-year in the second quarter, record U.S. convertible bond issuance reaching $135 billion, and Goldman's credit team raising its full-year U.S. investment-grade issuance forecast by $200 billion. Oppenheimer argues that AI infrastructure spending and government borrowing are competing for the same pool of capital, driving up the global cost of capital.
While he does not definitively state that the earnings bubble exists, his report is backed by capex-to-cash-flow data, record credit issuance, and a downgraded near-term outlook on stocks.
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