Latest news with #AIboom
Yahoo
3 days ago
- Business
- Yahoo
The AI Boom Is Creating Housing Costs in the Bay Area That You'll Think You Must Be Hallucinating
Akin to a rapacious maw, the AI boom has swallowed up untold amounts of water, energy, and jobs lost to automation. Now add the rapidly dwindling housing stock in the Bay Area as even more tech workers crowd in, lured by the possibility of enriching themselves in this massive AI gold rush, according to reporting from The San Francisco Standard. Housing costs are already notoriously high in the San Fran area, but the AI boom has ratcheted up numbers to eye-watering figures while startup workers are forced to bunk up in small but costly rooms that are the spendy equivalent of flophouses, the publication reports. In an eye-opening example, tech bro Akshyae Singh is living in what sounds like a postage-size room and has to share the bathroom with 12 other folks. And he's paying — get this — a ridiculous $2,300 a month for the privilege. "My professional life is great," Singh told the Standard, "but my living situation is, like, the total opposite." It's so bad that people are snatching up apartments unseen while open house events are attracting droves of would-be renters. Some people have resorted to putting together "tenant résumés" to get a leg up on the competition. Leasing agent Brian Brown told the news outlet that he now has only a handful of listings — in contrast to 80 units at the height of the COVID pandemic. "It's the AI boom," realtor Van den Eikhof told the Standard. "Everybody knows that. Also, I think a lot of people got good deals during COVID and are staying put. It's putting a strain on inventory." The numbers are bonkers. Two-bedroom abodes have increased by 16 percent, reaching $4,621 on average, according to Zumper, which the news outlet cited. Median rent is $3,461. Certain neighborhoods like North Beach have jumped an astonishing 79 percent in the past year, topping out at an average of $5,475 per month for a two-bedroom. One agent told the Standard that she recently listed a two-bedroom unit for $12,000 per month, but it got snapped up in a single day for $14,500. You might wonder how regular non-tech folks are faring. For starters, the city has a terrible homeless problem, with people living rough outside or sleeping in RVs. Service workers, the people who clean and cook after these tech bros, often have to commute in from extraordinary distances. Even with recent progress on affordable housing in the Bay Area, ordinary people are undoubtedly shut out if you look at the numbers. The moving company PODS reported earlier this year that Los Angeles and the Bay Area are the top two locales with the "Highest Number of Move-Outs Ranked." And as the AI boom swallows up resources and attention, it's all only going to get worse. More on AI and costs: AI Data Centers Accused of Creating Major Problems for Local Water Systems Solve the daily Crossword
Yahoo
7 days ago
- Business
- Yahoo
AI Boom Leads to Record Costs on US Grid and Call for New Plants
(Bloomberg) -- Businesses and households served by the largest US power grid will spend a record $16.1 billion to ensure electricity supplies — a result that prompted immediate calls from utilities and energy groups to build more generation amid the AI frenzy. Why the Federal Reserve's Building Renovation Costs $2.5 Billion Trump Awards $1.26 Billion Contract to Build Biggest Immigrant Detention Center in US Salt Lake City Turns Winter Olympic Bid Into Statewide Bond Boom Milan Corruption Probe Casts Shadow Over Property Boom How San Jose's Mayor Is Working to Build an AI Capital The payouts to generators and other suppliers topped last year's record $14.7 billion, according to PJM Interconnection LLC, which operates the grid stretching from the Midwest to the mid-Atlantic. That raises the capacity price per megawatt each day to $329.17 from $269.92. The AI boom is driving the biggest surge in electric demand in decades, leading to soaring utility bills and disagreement over which power resources are best equipped to satisfy those needs. While the power industry is coalescing around new plants as a way to alleviate potential shortfalls — and to make money — such efforts would also risk adding to consumer costs at a time when politicians are sensitive about energy inflation. 'It literally tells you we are out of generation,' said Sean Kelly, a former power trader and chief executive officer of power forecasting firm Amperon Holdings Inc. 'It's good for traders, it's good for asset owners, it is not good for consumers.' The shares of independent power producers Constellation Energy Corp., Talen Energy Corp., NRG Energy Inc. and Vistra Corp. gained in late trading in New York on Tuesday. The results of PJM's auction — which secures a year of electricity supplies starting in June 2026 — may add 1.5% to 5% to consumer electricity bills, according to Executive Vice President Stu Bresler. 'Customers are frustrated by high energy costs and I share their frustration,' Calvin Butler, chief executive officer of utilities owner Exelon Corp., said in an emailed statement. The capacity auction has a compounding impact on customers as rising demand, shrinking supply and aging infrastructure add to costs, Butler said. To address the shortage, Exelon has proposed building power plants instead of only buying supply from others in the capacity auction, and then passing those costs directly to ratepayers. Impact of data centers David Lapp, Maryland's People's Counsel, pointed to data centers as the culprit behind another record auction: 'Residential customers will continue to bear unreasonably high prices to support actual and projected power demands from data centers owned by some of the world's biggest corporations.' In a statement Tuesday, Lapp said he expects many Maryland residents to see slight bill increases, though some may see small declines. While PJM didn't specify how much of the projected demand increase was tied to AI, Bresler said in a media briefing Tuesday that 'the majority of the demand increase you saw was large loads and data center additions.' After the auction, PJM's contracted power mix will include 45% natural gas, 21% nuclear, 22% coal, 4% hydro, 3% wind and 1% solar. And although the grid operator has approved about 46 gigawatts of new power supplies for grid connection — mainly renewables and batteries — those haven't been built because of financing, permitting and supply chain delays. The results of the auction come amid a debate over older fossil-fuel plants that had been expected to retire. The Trump administration has already moved to keep plants afloat, contending that they're needed for grid reliability, while also phasing out tax credits for renewables. Yet, with those subsidies expiring at a time of record auction prices, solar and wind developers will likely try to build everything they can in the next two years, according to Kelly. 'We are going to see a lot of renewable generation before the end of 2027,' he said. Elon Musk's Empire Is Creaking Under the Strain of Elon Musk Burning Man Is Burning Through Cash A Rebel Army Is Building a Rare-Earth Empire on China's Border Thailand's Changing Cannabis Rules Leave Farmers in a Tough Spot How Starbucks' CEO Plans to Tame the Rush-Hour Free-for-All ©2025 Bloomberg L.P. Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Wall Street Journal
20-07-2025
- Business
- Wall Street Journal
Small Stocks May Be Too Cheap to Pass Up
Little companies are supposed to earn higher returns over time than big ones, but that hasn't been the case for more than a decade. Since the beginning of 2014, the S&P 500 has grown at an average of 13.2% annually, while the Russell 2000 index of small stocks has gained just 7.2%. Much of that underperformance comes from underexposure to this market's hottest sector. Technology firms constitute nearly 34% of the total capitalization of the S&P 500, versus less than 13% of total value in the Russell 2000. Big stocks have all the momentum of the artificial-intelligence boom. But what if AI turns out to be a bust, it fails to meet expectations or the biggest stocks end up stagnating? History suggests that if the market's biggest companies do stumble, the little guys might do reasonably well. 🔎 Read more:
Bloomberg
17-07-2025
- Business
- Bloomberg
Blackstone's Data Center Darling Confronts a Future Without Its $3 Billion Man
QTS Founder Chad Williams and Blackstone Inc. were on a hot streak. In the four years since the private equity firm's $10 billion takeover, the company had become North America's biggest data center landlord and a force in the artificial intelligence boom. So it was a shock to staff when QTS in March said Williams would be leaving the developer — a $60 billion powerhouse and one of Blackstone's best bets to date. The chief executive officer's two-decade run at QTS would end in less than one month.
Yahoo
16-07-2025
- Business
- Yahoo
One chart shows why the stock market could be in a bigger bubble than the dot-com boom
The S&P 500 might be in a bubble larger than the dot-com boom, Apollo's Torsten Slok says. The top economist pointed to higher valuations in the top 10 S&P 500 companies compared to the 1990s. Wall Street has debated whether the stock market is in a bubble in the years since the AI boom took off. The stock market may be in a bubble that rivals the one seen during the dot-com boom. That's according to Torsten Sløk, the chief economist of Apollo Global Management, who said on Wednesday that the top firms in the S&P 500 are "more overvalued" than the top companies during the peak of the internet stock craze in the late 1990s and early 2000s The top 10 names in the benchmark index are trading at a 12-month forward price-to-earnings ratio of around 25, according to Sløk's analysis. That suggests companies are priced at a slightly higher premium than they were two decades ago, he wrote in a note on Wednesday. "The difference between the IT bubble in the 1990s and the AI bubble today is that the top 10 companies in the S&P 500 today are more overvalued than they were in the 1990s," Slok wrote. Talk of a bubble has been on the rise for years on Wall Street, ever since the debut of ChatGPT at the end of 2022 set off a frenzy for AI in the stock market. The market has all the ingredients for a stock bubble, with the exception of a more dovish Federal Reserve, strategists at UBS wrote in a note last week. Once the central bank resumes cutting rates, the conditions for a bubble should all be present, the bank said. "We up the probability of a Bubble scenario to 25% for end-2026 and acknowledge a risk that this is too low," the strategists wrote. In early July, Citi said it believed stocks would continue to outperform, thanks to an AI bubble forming in equities. "Our hunch would be a possible bubble in AI related stocks may well only peak around half a year before the capex spent in USD peaks," analysts wrote, referring to capital expenditures related to AI. In June, market veteran Ed Yardeni said he believed the market could be entering "melt-up mode," a state in which stocks see a rapid rise that proves to be ultimately unsustainable. "It's a bit hard to believe, but the main risk at this time may be a stock market meltup, i.e., a speculative bubble," he wrote, pointing to the S&P 500 notching a fresh record that month. Read the original article on Business Insider Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
