It is Jerome “Transitory Inflation” Powell’s last Jackson Hole Economic Symposium. President Donald J. Trump has made it clear that Powell’s time leading the central bank is coming to a close. This time next year, there will be a new clown in a gray flannel suit delivering the closing statements at Jackson Hole. So let’s reflect on the career of a man who presided over the biggest surge in inflation since Jimmy Carter was in the White House.
Everyone’s watching the wrong AI boom. While Wall Street and Silicon Valley obsess over ChatGPT-5 – or how many exaflops xAI is hoarding – they’re missing the real earthquake rumbling beneath the surface. The foundations of the AI world are about to crack… reordering the entire semiconductor supply chain.
Are we finally seeing the effects of tariffs in prices? Last week, the producer Price Inflation (PPI) spiked to its highest levels in close to four years. If tariffs were the culprit, we could reverse the inflation by simply ditching them. It would be a problem with an easy solution. Unfortunately, that’s not what’s happening here.
Every pound of steel used to make a tank is not used to build an HVAC system. And even if the money is fake — “printed” and borrowed — it still is used to buy real resources that must come out of the real economy. Which brings us to our question for today: What is it we’re not seeing? What’s the rest of the story?
The world’s first robot store is now open in Beijing, where customers can now add humanoid robotics to their metaphorical shopping carts. But this isn’t a localized trend. It’s growing worldwide. So, today, let’s take a look at one tech giant where AI-powered robotics is already making major payroll waves stateside.
As of this morning, the futures markets are pricing in a 93.8% chance that Powell cuts by 0.25% and a 6.2% chance he lops it by a full 0.5%. But is this a good thing? Not so much…
And every year, investors make the same mistake. August is often the start of a seasonally weak period for stocks. Trading volumes thin out, Wall Street’s biggest players go on vacation, and volatility tends to pick up. It’s a set of conditions that make it far too easy to make the single biggest mistake investors can make.
It’s almost nonsensical to talk about “the economy,” because it’s wildly different depending on where you look. The tech sector is booming, and most white-collar and creative jobs are still in good shape.
But outside of the tech bubble, it’s not looking so hot. The middle class and blue-collar economy is hurting. Inflation still stings… The manufacturing renaissance has not yet materialized. What gives?
Wall Street is watching you… Not in a creepy surveillance-camera kind of way. Rather, it’s a type of financial surveillance that – without your knowledge – radically tilts the playing field in Wall Street’s favor. It happens every time you buy or sell a stock on Schwab, E*Trade, Fidelity, or other brokerage apps. As you can imagine, this surveillance strategy has been a gold mine. Now you can do it too.
AI is changing the world. We need it to do exactly that. But right now, the economics of AI are terrible.
