Blain’s Morning Porridge Oct 29th 2025 – How much will AI cost, and how much can we afford?

About this episode

How much will AI cost, and how much can we afford?

 “The greatest trick the devil ever pulled was convincingthe world he didn’t exist..”

The AI Bubble floats on a wave of Confidence – confidencethe global economy needs it, the USA will lead it, the hyperscalers and AI firms can afford it, energy is not an issues, and competition from China, tech evolution and quantum are not issues. All the market sees is opportunity. Beenhere before.

There is a marvellous Scots word – Gallus. It describes someone with a certain amount of swagger, who is bold, convincing,and above all confident. Confidence is the greatest bluff in the book. Confidence is contagious. Confidence persuades where reason will not. I reckon a surfeit of over-confidence is at the root of every single major market correction and collapse. 

Despite all the concern, uncertainty and a growing sense ofinstability some of us feel in markets, and especially AI, confidence still defines the current market mood. Damn the torpedoes.. confidence is everything!

Donald Trump is a gallus man. His confidence is drivingthe US economy. Despite all the issues, the US economy has not collapsed in a sluff of the economic logic folk like myself confidently predicted from tariffs, inflation, trade, supply lines, etc. Earlier this week he inked a deal with Japan, adding to the trillions of dollars of foreign investment promises already heading America’s way. Trump tell us he’s going to personally allocate that money – which is news to most of the countries that made vague acknowledgements about exploring how to do more with America in return for Trump rowing back theirrespective tariff levels.

Other commentators describe Trump’s Middle East and currentAsian Tour as a Mafiosi Don visiting clients for the annual shakedown for his protection racket. Harsh, but not unfair….

It all sounds fantastic, trillions of foreign investmentscreating jobs and boosting the US economy, while all the tariff money foreign exporters are paying continues to pay down the national debt! What’s not to like about how Trump has transformed the economy and the rest of the world getsto pay for it?

But… Let’s see if any of that promised investment evermaterialises. In the meantime, bang that drum a little harder, because its giving America confidence...

THe other big confidence issue for the economy is AI – just howbig and affordable is it?

Big news yesterday was Sam Altman of Open AI turning thealtruistic not-for-profit into potentially the most valuable for profit IPO of all time… The new board structure looks… complex, but he is also a gallus man, (even though he does not look the most impressive of entreprenuers.. (It is just me that thinks he looks… hunted?))