Artificial Intelligence, Getting Ahead of Itself?

Worldwide inventories of critical oil and natural gas draw dangerously low as negotiations with Iran about opening the Strait of Hormuz progress slowly. Regardless, the world’s stock markets have had a great Bull run, until Friday, June 5. Using the broad based Willshire 5000 Index, the U.S. market alone lost $1.8 Trillion that day, a sizable sum for a $77.5 Trillion market at the end of the day June 4, although losing only part of its 2026 gain. This large loss was AI tech focused, pressured perhaps by the weight of related forthcoming IPOs from Space-X, Anthropic, and Open AI. For perspective of our relative stock market strength, the U. S. produces 25-27% of the world’s GDP but represents over 60% of the world’s stock market capitalization. We have enjoyed the leadership and strength of the U.S. Dollar standing for the growth of the world economy for many years, although our debt as a percentage of GDP is now almost twice as much as China’s and Germany’s ratios. Ouch!

Some break in the market was overdue, especially because our sovereign and now our corporate debts are growing rapidly at this point of the buildout for data centers and infrastructure in this huge Artificial Intelligence spending cycle. Along with tariffs, wars, and a still growing economy, inflation is increasing adding uncertainty to interest rates and further complicated with a new Federal Reserve Chairperson in an important Mid Term Election year. The timing of the data center and infrastructure build out is very unclear. This all is coinciding with uncertainties facing many financially pressed consumers. Many companies have preannounced large layoffs partly related to AI, but actual layoffs may now become effective as Agentic AI gets more utilized while companies try to improve profitability rather than increase more debt.

Competition is intensifying in this economy and certainly including technology. Elon Musk’s Space-X is expected to combine at some point with Tesla creating a formidable low-cost fully vertically integrated company producing many AI generated related products and services almost reminiscent of the Rockefeller antitrust era. Two major changes likely affecting our industry will be the use of Starlink’s telecommunication systems to modernize faster blockchain banking, plus robotics for many uses including autonomous robotaxis and electric vehicles at some point as costs decline.

Yes, the stock market often has setbacks while economic progress continues. A transformational change like AI also needs serious public discussion of the pros and cons to ever be accepted. Businesses need stable and consistent geopolitical policies to plan capital spending to not face financial losses moving either too quickly or too slowly. AI is moving very quickly.

If our flexible and resilient c-store industry of approximately 150,000 locations continues to provide convenience effectively, it will lead many other less flexible retail industries. If I forget that point occasionally, I recall 1999 when so many people worried that the world would end at 12:00 o’clock on Y2K. When consumers were asked; ‘If the world ended tomorrow, what do you want to take with you?’, one of the top five responses was ‘My favorite convenience store’. Same answer today? Perhaps.

Jeff Kramer

jeff.kramer@nrc.com

(303) 619-0611