Who is NOT bearing the risk of a burst AI bubble? Wall Street. @agranato42.bsky.social & @pranjal-drall.bsky.social on how private credit firms are shifting the risk of their insane AI gambles to life insurance companies, with state guaranty funds (i.e., taxpayers) on the hook to clean up the mess.
Private credit companies are key owners of AI-related assets. Many of their parent private equity firms own life insurers that are dumping grounds for bad loans—and subject to state bailouts.
Instead of passing through bankruptcy, insolvent life insurers have all their liabilities—in particular the policyholder claims—paid for by state guaranty funds.
prospect.org