America has about 65 gigawatts of data centers, with another 413 planned, according to Clean View. Completion dates for the biggest projects are still listed as TBD.
That leaves a question behind the buildout: if demand for AI computing falls short, who carries the costs?
Power Costs Depend on Location
A data center’s effect on power prices depends partly on where it is built.
The Electric Power Research Institute found that power in a typical state would have been about 6% more expensive without data centers built between 2019 and 2024. Most of that benefit came from places with spare capacity. In those places, data centers helped use power capacity that was already there.
PJM’s Independent Market Monitor sees a different problem in its region. It attributes about $6.3 billion in future capacity costs to planned data centers and says those centers are not paying the costs themselves.
Both findings matter. A project can help use spare capacity in one place and add costs in another. With so much more capacity planned, where it gets built affects who may pay. A recent poll found that three out of four Americans would oppose a data center in their community.
Financing and Local Costs Keep the Question Open
The borrowing behind these projects offers another warning sign.
QTS issued $4.6 billion of bonds at a 5.7% yield in April. Investors later realized the bonds would not be fully repaid before Microsoft’s initial lease ended. When QTS borrowed again in August, the yield was 7.2%.
Bloomberg reported that the swaps market was pricing in a more than 60% chance of Coreweave defaulting within five years. One economist estimates that the AI buildout will cost about 3.6% of U.S. GDP every year until 2032. These are estimates, but they help explain why the question of who pays deserves attention.
Some costs are already part of local discussions. Near Memphis, XAI said it was running 27 gas turbines in January. Regulators counted 69 by July.
Memphis passed an ordinance directing 25% of property taxes from XAI’s facilities, up to $100 million, to nearby neighborhoods. That does not answer who would carry the costs of a wider buildout if demand falls short. It shows that the cost question is already being addressed in places where facilities operate.
Meta Proposes a Way to Charge for an AI Agent
Meta introduced Muse on Tuesday. The company says the app can book appointments, fill out forms and monitor home security camera feeds. Meta says access will be through a free tier or monthly plans of $20 or $100, depending on usage.
Those uses also raise questions about user data. Meta says Muse asks before doing anything sensitive and does not see users’ actual passwords or payment details. Users must opt out if they do not want their interactions used to train Meta’s AI models. Meta says it will scrub critical personally identifying information before using interactions from users who have not opted out.
Meta is also exploring a cut of shopping transactions made through agents, though it says it has no concrete plan. The company faces pressure to show returns on its AI investments. Muse gives it a proposed way to charge users. The shopping idea is still only an idea.
Retirement Balances Rose, but Investor Questions Remain
Fidelity says the average 401(k) balance rose 10.5% from March through June, its biggest quarterly increase since 2020. Workers invested an average 14.4% of their paychecks, including employer contributions.
The reported average balance was $75,200 for participants in their 30s and $156,800 for those in their 40s. Those are group averages. They do not say what any particular worker has saved.
Elsewhere in the market, one commentator is asking whether Uber shares are an opportunity. They say the shares are down over 27% in the past year, trade at 17.3 times forward earnings and 13.4 times price to free cash flow, and sit near a 52-week low.
The commentator points to the CEO’s $10 million purchase at $71 and the COO’s purchase of more than $5.3 million at $75. Those purchases and valuation figures explain the question. They do not settle it.
One investor describes a cautious set of choices. He says Bitcoin has zero value and calls gold nonproductive. He favors being fully invested in stocks when he can find long-term returns of 10% or more with a margin of safety. Otherwise, he says three-month or shorter Treasuries are an option while he waits.
He calls the market the second most expensive in history, behind only the dotcom bubble. He also says he sees few low-risk public opportunities offering 10% returns, and that money needed next year should be kept out of stock market volatility. That is his view, not a return he says stocks will deliver.
One commentator offers a separate, conditional warning. They say next week’s economic releases and FOMC decision could bring major volatility. They put Brent crude near $117 and Thursday’s inflation estimate at 3.6%, up from 3.4%. Their concern is that hotter inflation and a Fed signal of further rate hikes could trigger selling in stocks, metals and crypto. Neither condition has happened in this account.