Former China Central Bank Governor Warns AI Investment Losses Could Spark Crisis

Former People's Bank of China governor 周小川 warned that losses on artificial intelligence investments could trigger financial turmoil and require broad economic support and bailouts for some financial institutions amid heavy spending on AI infrastructure.

At a roundtable during 2026外滩年会, 周小川 said some AI investments will succeed while others will fail. The substantial funding directed toward the technology and related infrastructure means unsuccessful investments could become a wider financial risk, he said.

周小川 urged officials to study that risk and prepare policy tools for a potential disruption. His warning concerned what could happen if investments fail, rather than a crisis already underway.

The potential effects extend beyond AI companies. A pullback in spending or weaker profits could put pressure on AI-linked stocks and credit, tightening financial conditions more broadly.

Former Treasury Secretary Robert Rubin has raised a related concern about interconnected AI financing. Suppliers may borrow and expand based on future purchase commitments from large AI companies, leaving losses to spread if expected revenue or productivity gains do not emerge.