Every tech company now seems to have their own AI: Google Gemini. OpenAI’s ChatGPT. MetaAI. Spending for AI is reaching record highs, powering a big boom for the stock market. Even the White House wants in on the fun.

So are we in an AI bubble — an overblown investment period that’s bound to deflate? Yes, argues Paul Kedrosky, a partner with SK Ventures and a fellow at MIT’s Initiative on the Digital Economy. But not the bubble everyone thinks we are in. “AI is obviously a hugely important technology,” Kedrosky told Today, Explained co-host Noel King. So what, then?

It’s the money going into the AI infrastructure like data centers that concerns Kedrosky: “We’re spending this prodigious amount of money on the underlying infrastructure for AI with probably no likelihood of recovering most of that cost, and a significant likelihood that most of those assets become worthless because of the speed at which they depreciate.”

What happens when the bubble pops? And can past bubbles tell us anything about what is to come?

Below is an excerpt of their conversation, edited for length and clarity. There’s much more in the full episode, so listen to Today, Explained wherever you get podcasts, including Apple........

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