The Bank for International Settlements, known as the "central bank for central banks," warns that the current artificial intelligence buildout mirrors historical technological revolutions that ended in painful busts. These past booms saw massive investment in new infrastructure before economic returns were realized. The BIS highlights that the scale and pace of AI investment, coupled with expectations of significant productivity gains, resemble these precedents, indicating potential near-term downside risks. If AI returns disappoint, the current spending surge could lead to a protracted investment bust with widespread financial system effects. The AI boom has driven up company valuations, financed infrastructure, and expanded supplier capacity, supporting the global economy. However, if investors doubt AI's payoff, major tech companies might reduce spending, impacting firms and developers that expanded based on this growth. This could strain the private credit market, where AI borrowers face redemption requests and forced asset liquidations. A correction in AI-related stocks, particularly in the US, could globally impact wealth due to the dominant role of US equities. The concentrated nature of the AI ecosystem, with hyperscalers, suppliers, and private lenders linked by debt, creates transmission channels for a slowdown. This occurs amidst existing financial vulnerabilities, stubborn inflation, and supply shocks, potentially amplifying macroeconomic consequences. While AI may ultimately deliver expected productivity, navigating this investment cycle along with inflation and financial risks presents an unprecedented challenge for policymakers.