AI's debt binge can't last, hidden borrowing reaches $1.65T

AI hyperscalers are on track to issue a record $400 billion in bonds this year, but hidden debts—off-balance-sheet commitments like GPU purchase deals and data center leases—have exploded to $1.65 trillion, exceeding their on-balance-sheet debt. S&P warns that market participants are growing leery of rapidly rising leverage, while Moody's flags $1.2 trillion in debt-equivalent liabilities. The shift from asset-light to asset-heavy models requires unprecedented capital, and the rivers of capital may not flow as freely forever.