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Y I did want to just get your take on the broader AI picture. I mean the amount of money that is being committed by open AI for example as we've been talking about to companies uh and just the the enormity of this capital. I don't know if you've ever seen anything like it in your career and I'm curious as to how you view it and whether you think that those who use the word bubble are correct in in in that usage.
Well, there's a bubble in investing, but are we conf inferring a bubble means a bad thing? But there is certainly a a skyrocketing amount of capital that's being put to work. If you put it in a framework of geopolitical positioning, we as a country need these investments if we're going to be the leader in AI technology.
So, as a as an American, I'm pretty happy that we're investing this much money. I want us to be first. So, let's start there. Does that mean is there going to be some failures within the confines of these investments? Absolutely. But I do believe we are going to have to invest these huge sums of money.
If you think about it, investing in AI does not just mean investing in GPUs and chips. It means investing in HVAC and inv investing in in power grids and power supplies. U it means employing a lot of people too to build this out. So we are talking a trillion and a half dollars we estimate just on data centers and power and all that but if you see the rapid need in advance I could say at black rockck the amount of information that we are trying to generate ourselves and the speed in which we want to generate we're spending more and more on it and we're getting good results on it.
I believe every major company is going to have to be spending more and more on this. I think some of the investments that we've seen so far is not on AI. It's more on cloud and the power of the cloud. So I do believe this is I don't believe this is a bubble, but I believe this is capital that in most cases is going to be well spent.
That being said, will there be one or two failures in that? Absolutely. And that's the that is capitalism. We're going to have some big winners and we're going to have some big losers. And obviously we have to but if you have a diversified portfolio, you're going to be fine in all that. Yeah, and if you're a stock picker, you better be picking the right ones.
I'm pretty constructive on our big hyperscalers, though. And I do believe the metas, the alphabets, the u the Microsofts are in really good position to be winners. And you're seeing the transformation out of Oracle and what they're doing and how how Larry is trying to transform it. Broadcom, what Hakan is trying to do.
I actually am proud of the US footprint in this and I do believe we're gonna need to spend this money to win on a geopolitical basis. I don't want to give Jim the last word here. Last question to you. Yeah. Larry, when you've been on I think when you've been on the last couple times you've talked about public private partnership, the need to be able to have something bigger to be able to tack the uh the deficit which continues to grow.
Are you seeing that? And is is is this administration helping that? Uh well well this administration is very open to all businesses to talk to them to try to find ways that we could build our economy. So I you know there are many conversations going on with this administration. Uh that being said I mean you you rightly in noting that the greatest risk we have as at a for the US economy is our deficits.
And if we do not grow our economy by 3% a year over the next 10 years our deficits are going to overwhelm this economy. And we all know it. If we could grow our economy by unlocking private markets, if we could unlock private capital and we could grow our economy by 3%, I'm not worried about the deficits.
That's a big lot. That's a big leap for economy, our scale to grow at 10 3% a year for over 10 years. That's a big issue. And so, you know, we need to be focusing on how do we unlock this capital? We need to focus on how to build this out. This is why I love this AI buildout. Why I believe we need to be building out our grids, building all this out.
This is the type of stuff that could power a 3% economy. If you look at the second quarter results, three 3.8% GDP in the second quarter. 50% of that was was capex on technology. You know what? But when but if you compare that to Europe or other places in the world, we're the only country that has this type of capex that gives me confidence that we're going to win.
And I when I go around the world and talking about other economies, when I don't see that capex happening in their country, I worry about that future. Well, we have the capital markets to support it and I guess they don't. Larry, we'll always uh continue the conversation, we hope, as well, but appreciate your being here today. Thank you. Thanks everybody. Larry Frink, chairman and CEO of Black Rockck.
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