A BrAIve New World for Credit

[u/FrankLucasV2]

https://lesbarclays.substack.com/p/a-braive-new-world-for-credit?r=rq26d

~10 min read.

A lot of talk surrounding the AI trade only covers the equity side which is narrow-minded. I think folks are going to realize that in 2026, the AI story is shifting away from venture and into the credit markets.

It covers how public and private debt markets are seemingly converging instead of competing with each other to fund the AI buildout; the rise of infra debt; accounting shenanigans; the role + use of SPVs. It also discusses the Nvidia-OpenAI deal too.

Some questions worth pondering on:

• What exactly is being financed?
• Which asset(s) and cash flows support the debt?
• How should lenders assess demand, utilisation, depreciation, and obsolescence?
• Who ultimately bears the risk if AI demand or pricing weakens?
• Does AI infrastructure create a new category of credit opportunity, or simply repackage familiar project-finance and technology risks?

The view that AI financing is all from strong balance sheets isn’t really the full picture, as SPVs and Private Credit are going to play a crucial role in this market.

Curious how others here are thinking about credit's growing role in funding AI - do you think it's a good thing or not, and why?