The U.S. economy is currently facing a difficult and hard-to-reconcile dilemma, and the root cause actually points to AI.

Large tech companies are investing astonishing amounts annually in AI infrastructure, mainly flowing into data centers and high-end chip procurement, roughly totaling around $3 trillion. However, these companies' combined annual cash flow is only about $1.5 trillion, meaning the remaining funds have to be raised through debt issuance. This financing pressure continues to weigh on the U.S. interest rate environment and financial system, posing a long-term hidden risk.

Looking at the latest GDP data—revised to 4.3% for Q3, well above market expectations of 3.3%, and even higher than Q2's 3.8%. But if you extend the timeline, the picture isn't as rosy. Q1 was -0.5%, Q2 was 3.8%, and the average of these two quarters is actually only about 2%, with some distortion caused by statistical adjustments (such as trade data technical distortions).

The 4.3% for Q3 is relatively clean data—free from tariff interference, government shutdowns, and obvious statistical errors—representing a true reflection of the policy environment when it’s normal. This growth rate is indeed strong, but for the Federal Reserve, it signals an awkward situation.

Why awkward? Because the economic heat hasn't translated into employment. The unemployment rate has risen to 4.5%, and more concerningly, some small non-farm indicators and leading indicators are approaching turning points, with white-collar jobs continuing to disappear.

AI is now almost another pillar supporting U.S. GDP growth, contributing a significant incremental boost similar to consumption. But the flip side is that it is systematically replacing human labor. The better the GDP looks, the worse the employment market appears.

This is the most troubling issue for the Federal Reserve—it's not something that can be solved by cutting interest rates. Lowering rates can stimulate demand, but it cannot revive jobs that are being replaced by AI.