According to Fortune, economist David McWilliams landed in the U.S. just 24 hours before his interview while touring for his 2024 international bestseller “The History of Money.” He immediately sensed America’s unique “boominess,” illustrated by an Uber driver who within minutes was discussing stocks, Bitcoin, AI, and Nvidia. McWilliams declared America’s AI-driven boom is “undoubtedly going to crash” because AI creates few jobs and relies on what he calls “digital lettuce” – perishable GPU investments that rapidly become outdated. He noted this contrasts with Europe’s risk-averse culture, where such financial speculation is rare. Despite his crash prediction, McWilliams expressed confidence in America’s long-term resilience due to its innovative spirit.
The digital lettuce problem
Here’s the thing about McWilliams’ “digital lettuce” analogy – it’s brutally simple and probably correct. He’s basically saying we’re pouring billions into GPU infrastructure that will be technologically obsolete within a year or two. That’s like building a massive farm to grow lettuce that wilts before you can sell it. And he’s not alone in this concern – Michael Burry of Big Short fame has been raising similar alarms about depreciation schedules and market valuations.
But is this really different from any other tech revolution? I mean, remember when everyone was building data centers for cloud computing? Many of those are still running on their original chips. The counter-argument from people like Ed Yardeni is that infrastructure has longer useful lives than McWilliams suggests. Still, there’s something unsettling about the scale of investment in technology that becomes outdated almost immediately.
Why America will be fine anyway
Now here’s where McWilliams gets really interesting. Despite predicting an AI crash, he’s remarkably optimistic about America’s ability to bounce back. He sees the U.S. as fundamentally different from Europe – an “iconoclast society” that embraces risk rather than trying to insure against it. That Uber driver talking stocks on Sunset Boulevard? That’s not just random – it’s evidence of what McWilliams calls the “universality of money” in American culture.
He traces this back to Alexander Hamilton establishing a banking system that allowed the revolutionary economy to borrow in its own currency within years. And he’s right about something crucial – Americans don’t hate rich people, they hate the professional class. Money itself is seen as a “great leveler” rather than something to be suspicious of. This cultural attitude creates an environment where failure isn’t permanent and innovation can thrive through what Joseph Schumpeter called “creative destruction.”
Economics as storytelling, not math
McWilliams makes no secret of his disdain for traditional economics texts, calling them “too boring for the general public.” He wants to “grab economics away from second-rate mathematicians and put it back into the realm of storytelling.” And honestly, he has a point. Humans are wired for stories, not regression analysis.
His book “The History of Money” treats money as a technology we’ve been shaping for millennia, much like fire. We’re a “pyrophytic species” that adapted to fire, and we’ve been adapting to money in similar ways. This perspective helps explain why he’s not worried about America long-term – the same innovative chaos that creates bubbles also creates the resilience to recover from them.
The political reality check
McWilliams offers one fascinating political insight that could prevent the worst-case scenario. He doesn’t think AI companies will become “too big to fail” because any politician – particularly someone like Donald Trump – would recognize that being “against Silicon Valley is an absolute winner” electorally. The only real danger would be if AI successfully linked itself to national security and the military-industrial complex.
So where does this leave us? Basically, we’re probably heading for an AI correction, but America’s unique relationship with risk and money means we’ll innovate our way through it. The digital lettuce might wilt, but the garden will keep producing. Whether you’re looking at industrial computing infrastructure or consumer AI applications, the underlying American innovative engine seems built to withstand these cycles.
