- BlackRock’s Rick Rieder says the AI-driven debt boom is creating some of the most attractive fixed-income opportunities in years, eclipsing long-dated Treasuries. “I spent the entire weekend looking at some of these transactions, participating in a pretty significant way,” the CIO of global fixed income told Bloomberg TV, adding, “I’ve never seen anything like it.”
- Pimco has bought a $4 billion slice of SpaceX’s roughly $40 billion equipment financing, led by Apollo Global Management, to fund purchases of Nvidia GPUs and related equipment, people familiar told Bloomberg; that is about 10% of the package (Lumida calculation). Pimco is taking part of the A2 tranche, which sits between the junior and senior slices and will be issued as privately placed 144a bonds.
- The supply is enormous: AI-related funding in global high-grade markets has passed $300 billion in 2026, roughly triple last year, and tech spending on AI could reach up to $1 trillion a year. Rieder prefers secured debt from established companies and cash-generating assets, and says investors can earn about 7% in short-dated, single-A-rated portfolios without the duration risk of long government bonds.
- Pricing has become more attractive as volume has grown. A Meta bond maturing in 2036 now trades more than 130 basis points over Treasuries versus 90 basis points when it priced in April, and US investment-grade yields sit at 5.9%, near their highest since late 2023, while the 10-year Treasury, yielding above 5%, has “taken a backseat,” Rieder said.
What Happened?
Rieder’s comments came after a burst of AI financing: Broadcom arranged a $63 billion deal to finance chips for Anthropic, SpaceX signed a roughly $40 billion equipment-finance lease with Apollo, Meta is seeking up to $95 billion from stock sales, and Anthropic filed for its IPO. Pimco’s purchase is part of that SpaceX package; the interest rate was not disclosed, and while earlier discussions had placed a subordinated portion in the mid-8% yield range, recent volatility sent investors back to the drawing board. Pimco has become a key buyer of AI debt, serving as an anchor investor in financing Oracle’s Michigan data center campus and backing Meta’s project in Louisiana, even as it has cautioned about the industry’s excesses. Rieder also noted that 10-year Treasury yields have risen 80 basis points this year.
Why It Matters?
When fixed-income heavyweights such as BlackRock and Pimco lean in this hard, it shows how far AI financing has moved from equity-funded capex into the core of fixed-income portfolios. Their preference for secured, asset-backed structures and senior-to-mezzanine tranches suggests they are being paid for risk while keeping some protection, rather than chasing unsecured exposure to cash-burning labs. Hyperscaler issuance is also soaking up hundreds of billions of dollars that might otherwise go into Treasuries, which helps explain why long-dated government debt has lost some appeal for big allocators. The wider spreads on deals like Meta’s 2036 bond show investors are demanding more compensation as supply grows.
What’s Next?
Investors will watch final pricing on the SpaceX bonds as a read on how much the recent AI volatility has repriced risk, especially at the subordinated level. Skeptics remain vocal: debt markets have soured on AI companies in recent weeks, Treasury Secretary Scott Bessent has suggested hyperscalers are issuing on the wrong part of the yield curve, and Citadel co-CIO Pablo Salame warned the capital demands of the AI boom will leave some casualties. Much of the angst centers on neoclouds, and SpaceX has sought to distinguish itself by pointing to its Starlink and launch revenue. Continued strong demand from managers such as BlackRock and Pimco would help keep the AI financing pipeline open.
