Executive Summary
Morgan Stanley's Global Chief Economist Seth Carpenter reveals a critical disconnect in 2026 economic forecasting: AI capital expenditure will drive demand-side growth while simultaneously preventing the disinflation the Federal Reserve needs to achieve its mandate. The firm projects US employment data will show sub-50,000 monthly job creation, potentially including negative prints, forcing the Fed to cut rates to 3% by mid-2026. This creates a productivity paradox where AI infrastructure spendi...
Key Investment Opportunity
AI Infrastructure Demand-Supply Timing Arbitrage
AI capex drives immediate economic demand while productivity benefits lag 2-3 years, creating sustained inflation above Fed targets and limiting monetary easing
...and 1 more investment opportunities
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