Economist warns recession risks masked under AI, wealth spending

Anirban Basu says AI growth and wealth concentration are hiding economic troubles for most Americans

Published on Feb. 13, 2026

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Economist Anirban Basu warns that artificial intelligence and wealth concentration among the top income brackets are masking the true state of the U.S. economy, which faces growing recession risks. While the stock market and AI-related industries are booming, the broader economy is stagnating, with job losses in key sectors like manufacturing, retail, and hospitality. Basu says the divide between Wall Street and Main Street prosperity is widening, with over 40% of Americans not owning any stocks.

Why it matters

Basu's analysis highlights the growing economic inequality in the U.S., where the benefits of technological growth and rising asset prices are accruing primarily to the wealthiest households. This could lead to a destabilizing scenario where a shock to the stock market or AI-driven industries could trigger a broader recession, impacting the majority of Americans who are not participating in the current economic expansion.

The details

Basu, the CEO of Baltimore-based Sage Policy Group, says that more than half of the expected 2.2% growth in U.S. GDP is coming from infrastructure spending for AI companies, masking the fact that the "balance of the economy is just not growing that quickly." He notes that the top 20% of income earners are responsible for over one-third of consumer spending, while 40% of Americans do not own any stocks. Basu warns that if there is a pullback in AI-related spending or the stock market, it could set off a "chain reaction" that destabilizes the economy, given the narrowing foundation of the recovery.

  • In the past 24 months, Delaware added 9,600 jobs, but the labor market took a sharp turn this year.
  • The Wilmington metropolitan area had among the worst unemployment rates in the country in the last two years.
  • Inflation rose 27.5% between May 2020 and December 2025, putting pressure on consumer spending.

The players

Anirban Basu

The CEO of Baltimore-based Sage Policy Group and an economist who provided an economic forecast for the New Castle County Chamber of Commerce.

Sage Policy Group

A Baltimore-based economic and policy consulting firm led by Anirban Basu.

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What they’re saying

“The balance of the economy is just not growing that quickly, and that's why you see the surveys indicating that people are quite pessimistic. You did not see that when we were adding a ton of jobs and [all five income groups] were participating in the economy. Now we're adding far fewer jobs and a lower number of people are participating in the economic expansion.”

— Anirban Basu, CEO, Sage Policy Group (delawarebusinesstimes.com)

“When they hear that Nvidia just became the first company in the world to make a $5 trillion market capitalization, it doesn't mean anything for them. It just means that somebody else will be paying the money to hold more shares.”

— Anirban Basu, CEO, Sage Policy Group (delawarebusinesstimes.com)

What’s next

Basu's analysis suggests that a shock to the stock market or AI-driven industries could trigger a broader recession, impacting the majority of Americans who are not participating in the current economic expansion. Policymakers and business leaders will likely be closely monitoring economic indicators and consumer sentiment in the coming months to assess the risk of such a destabilizing scenario.

The takeaway

Basu's warning highlights the growing divide between the economic fortunes of the wealthy and the rest of the country. While the stock market and AI-driven industries are booming, the broader economy is stagnating, with job losses in key sectors. This uneven recovery raises concerns about the sustainability of the current economic expansion and the potential for a destabilizing recession triggered by a shock to the financial markets or AI-related industries.