Kansas Fed Warns AI Ecosystem Risks 'Too Big

Economic Times Markets · stocks

Kansas City Federal Reserve President Jeff Schmid has voiced concerns that the burgeoning artificial intelligence industry and data-center investments could create an interconnected ecosystem deemed 'too big to fail.' He highlighted the need for the Federal Reserve to understand the complex network of companies, financing, and contracts rapidly developing around AI technology. Schmid drew parallels to the 2008 financial crisis, where interconnected institutions posed systemic risks.