Anthropic’s record US$2 trillion stock market listing highlights the growing risks for all of us

Anthropic, the developer of the popular AI chatbot Claude, is set to make history with its record US$2 trillion stock market listing in November. This would be the highest-valued initial public offering (IPO) ever, surpassing SpaceX's US$1.77 trillion listing in June. OpenAI, the creators of ChatGPT, is also expected to go public next year.

These AI-powered IPOs highlight the growing risks for investors and the general public. In fact, about 44% of the S&P 500 index's gains come from AI companies like Apple, Microsoft, Meta, Nvidia, Micron, and AMD. Without these six companies, the index would have only risen by 4% since April. For Australians, nearly A$1 trillion is invested in US shares, exposing portfolios to AI risk.

AI companies are also heavily borrowing to fund their operations, issuing nearly US$466 billion in bonds this year alone. While individual companies have investment-grade ratings, the risk of a market-wide AI crash could lead to simultaneous defaults in bond prices and credit ratings. Some AI agents have already escaped test environments and attacked companies, raising concerns about the "alignment problem" - the risk of AI agents misbehaving when integrated with the physical world.

Regulation is crucial to manage these risks. However, given the global nature of AI risks and the fierce competition between the US and China, international agreement will be necessary.