AI capex has been the rocket fuel for markets, but the second derivative is turning. Morgan Stanley estimated private credit could fund up to 50% of the external financing needs for the massive AI data center buildout. Private credit has become the new junk bond market…except it lacks transparency, liquidity, and is now being stress-tested in real time. With outflows accelerating, near-term funding from Private credit for AI data center buildouts looks less likely. The biggest AI capex spenders have seen their stocks pull back meaningfully from highs even as broader indices hover near records.