Bloomberg Surveillance Sep 21, 2026
With Torsten Slok, Chief Economist at Apollo Global Management
The US economy normally grows at about 2%. Torsten Slok said one percentage point of that growth is now coming from AI spending alone.
The usual worry about AI concentration is that ten stocks carry the equity index. Slok's version is wider than that. He walked through a standard 60-40 portfolio and found the same exposure in the bond sleeve, where hyperscalers are issuing investment-grade debt, and in the venture sleeve, which used to be pharmaceuticals and biotechnology.
"And we are waking up now in 2026, and we are basically all of us overexposed to AI, in particular in the 60-40."
Slok is the chief economist at Apollo Global Management, and the research note the hosts read back to him on air was his own. He had been in Europe two weeks before and spoke about the German election, the France-Germany spread and the succession at the European Central Bank from that visit.
The full segment is covered here so you can skip it.
Here are the 8 takeaways that matter.
Key Takeaways
One percentage point of US GDP growth comes from the AI spending boom, against a trend rate of about 2%
The count includes data centers and energy, and also spending on tokens and on tools for consumers and corporates
Mortgage rates went from 2.7 to about 7, and housing and autos are the two sectors carrying the cost
87% of venture capital is now AI, so the diversifier in a portfolio has become the same bet as the equity sleeve
The Forbes 400 hold about $4T; private business owners worth $10M or more hold $46.7T
The research reads de-identified tax records, and finds the wealth in restaurants, hardware stores and car dealerships
His diversification list is oil, refineries, value and private markets — the things that are not AI
Europe's growth over the next several years comes from defense and infrastructure budgets, not from its private sector
The US produces AI and the whole world adopts it, so the return goes to whoever puts capital and labor together best
1. Nominal GDP Boom
Tom Keene opened by saying the Fed's own projections have the nominal GDP boom continuing with no decline in real GDP, which he said was not in the textbooks he studied. Slok said two tailwinds explain it, and neither of them responds to interest rates.
AI spending is adding a full point to a 2% growth rate
GDP normally grows at two, and now one percentage point of growth is coming because of the AI spending boom, not only on data centers and energy, but also spending on tokens, remember that also goes into GDP, spending on tools for consumers, spending on tools for corporates.
Torsten Slok
The second tailwind is the tax and spending bill, which he said the Congressional Budget Office scores as adding about 0.9% to GDP. Combined with the wealth effect from high stock prices, that is why he expects growth to stay strong. Keene asked whether he is modeling a continued 5% nominal GDP, and framed it with Barry Eichengreen's argument that financialization benefits people who already own assets. Slok said yes.
2. Housing And Autos Lose
The part of the economy that does respond to interest rates is doing badly, and Slok named the two sectors.
Mortgage rates went from 2.7 to about 7
Mortgage rates during the pandemic were 2.7. Now mortgage rates are basically 7. It has become very expensive to buy a house. It's become very expensive to buy a car.
Torsten Slok
Home builders are at very low levels and people signing auto leases pay more. His point is that both sectors are small next to the AI boom and the fiscal bill, which is what makes the arithmetic work — and what makes it fragile.
The economy now needs AI to deliver
So one sentence that's very important here is that this AI thing better work out.
Torsten Slok
3. Where The Millionaires Are
Paul Sweeney described driving the Jersey Shore on his Vespa past two-million-dollar houses with million-dollar boats behind them and finding that the owners were small business owners. He then read from Slok's recent note, which quotes the new book The Everywhere Millionaire: the 400 wealthiest Americans on the annual Forbes list hold about $4 trillion between them, while private business owners with at least $10 million in net worth hold $46.7 trillion.
The wealth is in private business, and the tax records show it
This is really innovative work by two professors, Owen Zidar at Princeton and Eric Zwick at Chicago.
Torsten Slok
The two economists read de-identified Internal Revenue Service records and asked who the millionaires in the US actually are. The general impression, Slok said, is that the money is in technology and on Wall Street. It is not.
Restaurants, hardware stores and car dealerships
These are people who own restaurants locally across the country, people who own hardware stores, people who own car dealerships.
Torsten Slok
He said that matters from a consumer perspective, because where the wealth sits is also where the consumption happens.
4. One Factor In Everything
Keene asked how to measure fear of missing out in the institutional community. Slok answered with concentration rather than sentiment. AI has driven much of the S&P 500's return over five years, and the ten biggest stocks are 40% of the index. The fixed-income half of a 60-40 portfolio has picked up the same exposure, because the hyperscalers are issuing a lot more investment-grade debt. Then he came to the sleeve investors hold as a diversifier.
Venture capital used to be pharmaceuticals; now it is AI
Now, 87% of venture capital is also AI.
Torsten Slok
The lesson he drew is the one the industry spent fifteen years learning, applied to itself.
Everyone is overexposed to a single factor
And we are waking up now in 2026, and we are basically all of us overexposed to AI, in particular in the 60-40.
Torsten Slok
The conversation he says he is having with retail investors, households, institutions and sovereign wealth funds is the same everywhere, and the action item is rebalancing rather than selling.
5. How To Diversify
Sweeney said he was screaming that he had to diversify, and asked how. Keene supplied the one-word answer, non-AI. Slok started with commodities.
Middle East risk points oil higher, which makes it a diversifier
Absolutely, the challenges in the Middle East argue for risk still to the upside for oil prices, so commodities, oil, refineries is one way of looking at it.
Torsten Slok
The second route is growth against value, where value means companies that already have earnings. He added private credit and private equity to the list. All of them, he said, are genuine diversifiers away from AI.
6. Europe's Politics
Keene said the France-Germany spread had hit 100 basis points that morning, a milestone, with a fractured Germany heading into a Saxony vote and Paris turned upside down, and asked what Apollo's clients are told about political stability in Europe.
Slok, back from a visit two weeks earlier, said the German election result reaches markets through appointments: who the next European Central Bank president is, and who the next chief economist there is. Underneath that sit Europe's China policy and France's fiscal position.
Nobody has the answers yet, so markets are guessing
And that's what we in markets either have to make our guesses on or just watch this as it unfolds.
Torsten Slok
7. Europe's Boom Case
Keene called Slok hardwired glass-half-full and asked him to tell the gloom crew what they are getting wrong, noting the S&P 500 is about 2% from its high. Slok made the positive case on public spending.
Defense and infrastructure budgets are what carry Europe
The one thing that they do have going for them is, in particular, defense spending and infrastructure spending.
Torsten Slok
Governments across the continent are spending significant money to boost their economies, and he was explicit that this, rather than the private sector, is where the growth of the next several years comes from.
8. Producer And Adopter
Sweeney asked whether Europe is doing anything on AI. Slok's answer was "not much," and he turned it into a distinction that applies to every country including this one.
The US produces AI; everyone, the US included, adopts it
And let's just talk about it this way, the US is the AI producer, and the rest of the world, including the US, is the AI adopter.
Torsten Slok
If the models become commoditized, being the producer is worth less than being the best adopter. What decides that, he said, is how well a country gets capital and labor working together, which is where productivity gains and total factor productivity come from.
Bonus Insights
The Trichet line
Keene closed the segment by putting Slok's point in older company, saying it was classic Jean-Claude Trichet on how productivity spreads through an economy, and recalling the former European Central Bank president telling him in a French accent that Europe is not America.
The rest of the hour
Slok took the first segment of the program. The same hour carried Meghan Robson of BNP Paribas on credit, Alexis Crow of PwC on the AI trade, Dana Telsey of Telsey Advisory Group on retail and Bruce Wolfe of Alight on retirement income.
The three-hour conversation
Keene introduced Slok by saying they had a three-hour conversation to cram into the slot. They got about ten minutes.
Slok's bottom line is that the US economy is running on two tailwinds that interest rates cannot reach, AI capital spending and the fiscal bill, and that the same AI exposure has quietly colonized the equity, credit and venture sleeves of the same portfolio — so the trade is not to sell it but to own something that is not it.
Products, Companies & Tools Mentioned
Apollo Global Management (His firm. The note the hosts read from on air was Apollo's own research)
The Federal Reserve (Its projections have nominal GDP staying strong with no decline in real GDP, which is what opened the segment)
The European Central Bank (The German election matters to markets partly through who becomes its next president and next chief economist)
The Congressional Budget Office (Scores the tax and spending bill as adding about 0.9% to GDP)
Books & Resources Mentioned
The Everywhere Millionaire (The new book Slok quoted in a recent note: the Forbes 400 hold about $4 trillion, private business owners worth $10 million or more hold $46.7 trillion)
Owen Zidar and Eric Zwick on who the millionaires are (The Princeton and Chicago economists whose work on de-identified tax records found the wealth in local business rather than technology or Wall Street)
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