Fed’s Goolsbee says AI spending resembles demand shock

Published November 9, 2026 1:35 PM EST Updated November 9, 2026 4:24 PM EST 6 Min Read

Key insight: Federal Reserve Bank of Chicago President Austan Goolsbee, a key vote on the Federal Open Market Committee next year, is making the case for more restrictive monetary policy.
Expert quote: “This stuff with the AI data center build out is just, to my eyes, starting to look like old fashioned demand overheating where you get inflation coming from — [for example] everyone trying to hire an electrician at the same time and then you start seeing the prices go up.” — Federal Reserve Bank of Chicago President Austan Goolsbee

Many see artificial intelligence as a positive supply shock for the economy that will increase productivity and bring down prices. But one top Federal Reserve official said investment in the technology looks like an entirely different kind of shock.

Kyle Campbell

Staff writer

Kyle Campbell covers the Federal Reserve and housing policy for American Banker. Previously, he wrote about institutional investment in real estate for PERE. He has also held staff positions at Real … Read full bio

For reprint and licensing requests for this article, click here.

Economic indicators Politics and policy

More From Asset Securitization Report

Treasurys

U.S. bonds’ election rally skids to halt after strong jobs data

The U.S. midterm elections sparked declines for shares of large U.S. technology companies and oil prices that fueled gains for U.S. government bonds, sending yields to the lowest levels since early September.

November 6

Treasurys

Treasuries soar as tech-stock selloff stokes haven demand

The Treasury market last month notched its biggest gain in more than two years as investors lost faith in the sustainability of capital spending on artificial-intelligence infrastructure.

November 5

Mortgage rates

Watch spreads, not the Fed, for mortgage rate shifts

Concerns regarding AI companies' ability to handle inflation drove the 10-year Treasury under 5%, but with data still running hot, could yields turn upward?

By Brad Finkelstein

Originations Editor

National Mortgage News

October 29

Fixed income

Franklin Templeton experts balance a higher-rate world and weigh midterm impacts

Professionals anticipate higher volatility in the near term, while examining the risks and opportunities amid rising interest rates, with a yearend view.

By Karen Sibayan

October 28

Monetary policy

Fed will drop one interest rate vote next year; two in 2028

Federal Reserve Chair Kevin Warsh said the Federal Open Market Committee will continue to meet eight times a year, but one such meeting will not include an interest rate vote or an official policy statement.

By Kyle Campbell

Staff writer

American Banker

October 28