Key facts
- A Morgan Stanley bond manager is flagging concerns about Big Tech debt for AI.
- The manager's name is Vishal Khanduja.
- Khanduja believes credit risk may be undervalued.
- Amazon recently sold $25 billion in bonds.
- Khanduja found Amazon's bond sale surprising.
Vishal Khanduja, a prominent bond manager at Morgan Stanley, is highlighting potential risks tied to the large volumes of debt being issued by major technology companies. These companies are increasingly raising capital to fund their ambitious artificial intelligence projects. Khanduja expressed concern that the credit risk associated with this burgeoning debt may be currently undervalued by the market. He specifically cited Amazon's recent issuance of $25 billion in bonds as a transaction that caught him by surprise. This suggests to Khanduja that investors might not be adequately pricing in the potential downsides of these significant financial commitments. The trend of Big Tech leveraging debt for AI development is a key focus for Khanduja's analysis of the credit markets.