Excess Returns · Thursday, August 6, 2026
Chan Yang notes that AI-driven capital expenditures, particularly in cloud infrastructure, data centers, and semiconductors, are significant drivers of both productivity growth and inflation. He highlights that demand for these components is also influenced by other factors like EVs and 5G, creating a pull in the same direction.
“Yeah, so, you know, it's it's kind of like, you know, what we're talking about with the AI CapEx really is like an input into that, that specific bucket of productivity and innovation, right?”
“So, you know, we're seeing a lot of, uh, spending on cloud infrastructure, on data centers, on semiconductors, right? And obviously, these are all things that are going to be key drivers of AI adoption and also productivity growth.”
“But also, you know, the flip side of that is that it's also driving a lot of inflation, right?”
“So, you know, you have the demand side of that equation, you have the supply side of that equation. And, you know, if you think about, you know, what are the drivers of demand for these semiconductors, it's obviously AI, but also EVs, also, you know, 5G.”