Inside Wealth: Markets are underpricing the risk of Middle East pullback in AI, says tech investor Jack Selby

tech investor jack selby says markets are underpricing the risk that middle east sovereign wealth funds pull back from ai. those funds account for roughly a quarter of global ai commitments over the next five years, according to selby, managing director of thiel capital. if the war in iran drags on and countries like the uae and saudi arabia divert capital to rebuilding at home, hundreds of billions of dollars could drain from the ai boom. selby estimates half of the middle east's ai funding goes to data centers in the region, the other half to projects worldwide. some middle east funds have already started canceling shipping and business contracts by invoking force majeure. the risk is they start canceling data centers too. oracle, nvidia and cisco are part of openai's campus in the uae building 5 gigawatts of capacity. microsoft plans to invest $15 billion in the uae by 2029. openai reportedly sought $50 billion from big regional funds earlier this year. selby also warns of a broader ai bubble. he says the top hyperscalers are expected to spend more than $700 billion this year. when the bubble busts, he says losses will be "at least one more zero, probably two and three more zeros" than the dot-com bust. his own strategy is to avoid the crowded california, new york and massachusetts markets and invest in the other 47 states.