Jerome Powell on signs of an AI bubble and an economy leaning too hard on the rich: ‘Unusually large amounts of economic activity’

For months, Wall Street commentators have fretted that the artificial intelligence boom looks like a bubble, with capital spending – which some analysts estimate could reach $3 trillion by 2028 – fattening a few mega-cap firms, while lower-income workers suffer from a slack labor market.

On Wednesday, they got validation from an unlikely source: the chair of the Federal Reserve.

Jerome Powell said the U.S. is seeing “unusually large amounts of economic activity through the AI buildout,” a rare acknowledgement from the central bank that the surge is not only outsized, but also skewed toward the wealthy.

That imbalance extends beyond markets. Roughly 70% of U.S. economic growth comes from consumer spending, yet most households live paycheck to paycheck. That demand picture has tak