Anthropic IPO could lead to ‘large correction’ in markets, Fed official says
Fed Governor Michelle Bowman said a failure to meet lofty expectations “would likely slow the AI buildout” and “soften” the economy. Just as the proverbial ink was drying on Anthropic’s updated prospectus for the frontier lab’s expected $1.4 trillion IPO, a Federal Reserve official warned of a “large correction” in stock prices if AI returns fall short of expectations. Citing $800 billion in AI-related debt, plus off-balance-sheet liabilities and the circular financing powering the AI trade, Fed Governor Michelle Bowman said any “shock would likely slow the AI buildout” and “soften” the economy. Nowhere are expectations loftier than at Anthropic, the first frontier lab to go public. Its valuation has already come in below initial expectations. It’ll still be one of the biggest listings of all time, pegged at $90.4 billion, but any wobbles around the IPO — set to price on Nov. 18 and start trading the next day — “might mean a selloff of the AI theme around the IPO,” said Tore Opsahl, head of quantitative solutions advisory group at Nomura.
Fed Governor Michelle Bowman said a failure to meet lofty expectations “would likely slow the AI buildout” and “soften” the economy. Just as the proverbial ink was drying on Anthropic’s updated prospectus for the frontier lab’s expected $1.4 trillion IPO, a Federal Reserve official warned of a “large correction” in stock prices if AI returns fall short of expectations. Citing $800 billion in AI-related debt, plus off-balance-sheet liabilities and the circular financing powering the AI trade, Fed Governor Michelle Bowman said any “shock would likely slow the AI buildout” and “soften” the economy.
Nowhere are expectations loftier than at Anthropic, the first frontier lab to go public. Its valuation has already come in below initial expectations. It’ll still be one of the biggest listings of all time, pegged at $90.4 billion, but any wobbles around the IPO — set to price on Nov. 18 and start trading the next day — “might mean a selloff of the AI theme around the IPO,” said Tore Opsahl, head of quantitative solutions advisory group at Nomura.