This week's chart, drawn by the Financial Times from Bank for International Settlements data, lines up today's AI spending against four famous booms: the canal mania of the 1830s, British railway mania, the electrification boom of the Roaring 20s, and the dotcom bubble. Each line starts at 1 and tracks investment as a multiple of its pre-boom low. AI has hit 4.5 times its starting point in just three years. Canal mania peaked at 4.1 over five years, railways at 2.7 over four, while electrification and dotcom both topped out near 1.9. AI is steeper than all of them, and it hasn't peaked. These historic booms typically broke around year five, then dragged their economies into recession. We are at year three.
The 1840s railway mania in Britain was one of the greatest technology manias in history, and by 1850 cumulative investment neared half of Britain's GDP. George Hudson, known as the "Railway King", the Sam Altman of his day, ran over 1,000 miles of line and paid 10% dividends, partly out of capital as it later emerged, to keep share prices climbing. The market turned in late 1845, and shares slid through the panic of 1847 to bottom out in 1850, roughly two-thirds below their peak. The investors caught in the fall included Charles Darwin, John Stuart Mill and the Brontë sisters. Yet the track stayed. Much of the network Britain runs today was laid in those manic years. The question for AI isn't whether the correction comes, but whether we are laying track that outlives it, or authorising lines that never get built.