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Anybody who sits in front of a desk and does a job, how long is until AI can do the job as good as you can? You want an honest answer? 6 months ago, we saw what people were calling the SAS apocalypse. Claude was reaching this new level where it could essentially replace software companies. Why would you ever have software as a service when you could just make it a claw? Inflation didn't just go up. It was a massive spike to 3.8%. We haven't seen that level of inflation or that sort of a spike up in inflation outside of fairly major economic events.
We'll be printing money forever. Nothing's going to stop that. If we stopped putting more money into circulation into the economy right now, we would have to our economy has been going through a lot of changes in 2026 and we just got hit with another change. We now have a new chairman at the Federal Reserve Bank, Kevin Worsh. And the question on everyone's mind is what's he going to do? Is he going to cut interest rates and stimulate the economy? Is he going to raise interest rates, save the dollar, and crush the economy? And we're starting to see a lot of conflicting pieces of information, especially now that oil prices are continuing to rise, especially now that we're getting the news that AI is starting to hurt the job
market. And that's why to understand what's going on and how it creates investment opportunities, I'm sitting down with my firm's head of investing research, Jackson, to dig a little bit deeper, Jackson, what is Kevin Worsh going to do based off of your research. Are we going to see higher interest rates, lower interest rates? Where is the economy going? Uh, at the risk of sounding foolish in a couple weeks here, he's going to hold the line until September. They have to. After those last few inflation reports, inflation didn't just go up.
Inflation went up a lot. It was a massive spike to 3.8%. We haven't seen that level of inflation or that sort of a spike up in inflation outside of fairly major economic events. Wars is not like a lot of the other Trump appointees. Um he does have a little bit of that Trump effect in him, right? He's been a long-term rate hawk and he sort of pivoted to be dovish. What is hawk and dovish? He was in favor of generally higher rates to sort of protect the economy a little bit once he started campaigning for the position that he's now been elected to. He started to pivot his tone a little bit. He started to look at
potentially lowering rates. But he's a serious economist. He's not going to raise rates with how the job market looks, with how inflation looks. He's got to hold the line. They're going to hold the line until September. After that, it's probably anybody's game. So, he was a part Kevin Worsh was a part of the Federal Reserve Bank before. Yes. He was there during the 2008 great financial crisis. During that time, we were doing money printing and cutting of interest rates. And Kevin War said, "This is a bad idea. we need to be raising interest rates. So during the 2008 crash, he was saying to save the dollar, prevent hyperinflation, we need to raise interest rates. Well, that
didn't happen. He then left the Federal Reserve Bank. Now we're in a situation where inflation is a problem. It wasn't really a problem in 2008. Like we weren't concerned about inflation. We were concerned about the economy. Today in 2026, we are concerned about inflation and we have been concerned about inflation for 60 years now. We're also concerned about the economy. Yeah. And so this is where on one hand we have the economist saying Kevin Worsh believes in saving the dollar. Meaning Kevin Worsh believes in higher interest rates. The problem with those higher interest rates though is not only does that mean that your mortgage rate would go up and your car loan rate would go up
and the stock market would fall and the economy would hurt, but that also means that the government's national debt, $39 trillion, would get so much more expensive. Yes. On the flip side, Trump wants lower interest rates. Why? Obviously, you can get a cheaper mortgage, a cheaper car, the stock market would boom, and you know, all the good stuff that comes with lower interest rates, but that comes with the consequence of higher inflation. Americans are already seeing high inflation. Gas prices are crazy. Uh, I mean, there's no other way to say it. And it doesn't look like it's going to come down. We thought it was going to be
a two-eek war. Here we are months into it and oil prices keep going up. and you're saying we have to wait and see because I think Heaven Wars' first meeting is June 16th and June 17th. So that's when we're going to see what he does, but what are the things that you're paying attention to and what should somebody be watching? Well, just be first thing is our firm actually had it pegged as an eight-month war right out of the get-go. Uh bit of a contrarian opinion, but it's I think it's the only reasonable one if you look at the long history of so another four or five months to go potentially. We're already at a s if the war were to end tomorrow, we're already going to see at least six months of drag on manufacturing due to the increased
cost of energy really now. And it's it's all downstream. We're at this point I think it's going to be longer than that. I think the war will go on for a while longer. Uh it looks like it's on pretty shaky terms right now. The ceasefire has been a little on again off again. uh we cannot seem to work anything out and it doesn't feel like we're close to a resolution. I think that's sort of a bigger point. It doesn't feel like we're, you know, days away from pulling out and signing a long-term agreement. It feels like it's getting harder and harder to sort of, let's say, guide those talks between uh proxies as well, sort of Israel and Lebanon. Sort of the rest of the region is also starting to boil over a little
bit. It doesn't feel like we're close to a resolution. And the longer it drags on, the longer the tail end effect of that will be. The longer we are in Iran and the straight of Hormuse is closed, the longer the long-term effects will be. We'll have that sort of a long tail where we could be dealing with this for years. This the global supply chain. So, let's go through a couple examples and because there's only a couple things that can happen and I think for the listener, they should know based off of what happens where the opportunity is. Let's assume that sometime in 2026, maybe not June, but sometime in 2026, Kevin Worsh does what Trump wants, we see big interest rate cuts. What's going to happen? Oh,
it's hard to predict the future. I think that we will almost certainly see inflation back on the rise and we'll see inflation back on the rise very quickly. Now, you brought up 2008, which is an interesting example, and let's preface this by saying that when there was that easing, uh, the QE that Bernani did, Ben Bernanki, chairman of the Fed, back during the crisis, he quintupled the amount of money that was in circulation. And that was against the wishes of just about everybody on the political side of things. He was a Bush appointee. Uh he was a Republican at the time and he sort of went against party wishes to drop rates and just start putting a whole
bunch of money into the economy. And I also want to clarify, it's it's not so accurate to say printing money, the idea of we'll start printing money because that doesn't put money into circulation, we'll be printing money forever. Nothing is going to stop that. If we stopped putting more money into circulation into the economy right now, we would have to print money at the current rate for 118 years before we would catch up to what is already circulating through the economy. So when you hear this idea of like, oh, they're going to keep printing money. What they're actually talking about is increasing the M2 or which is the kind of total amount of money that is in bank accounts right now. So just
like dumping money, more and more money into the economy. 2008 was extreme circumstance and that quintupling of money in circulation really didn't affect inflation. And if you go and you look at some of those common indicators, the price of bread, the price of milk, uh those sort of household staples is what we call them over time, they kind of kept at this steady rise. It didn't shoot up when we put a lot more money into the economy. And it's because we were trying to navigate a crisis. We needed a lot of stimulus, a lot of money to pull us out of that crisis. Right now, we're experiencing a lot of indicators of what's called stagflation, which is where the economy is slowing
down. And normally the response to that is you need to stimulate the economy. You need to drop rates. You need to increase the flow of money and increase the amount of money in circulation. Stagflation is where you're seeing the economy slow down, but you're also seeing inflation happen. You're also seeing this sort of weakening currency. And so you can't if the currency's weakening, if inflation is increasing, you can't put more currency into circulation and stimulate the economy by giving people money to pull the economy out of it because it's not going to work. So if Kevin Worsh did cut rates, the dollar's at crisis, the dollar's at risk.
I would say yes, we would see the dollar we would see inflation. If Kevin Worsh were to cut rates right now or presumably later this year, and again, the circumstances may change between now and then, but with the current circumstances, if he cuts rates, we're going to see inflation go up. We're going to see the job market continue to slow, and we're really not going to mitigate the effects of stagflation. We're not going to mitigate the effects of this ongoing, I don't want to say economic crisis, but economic downturn, we'll say. In those types of situations, the winners that win generally are asset owners, particularly hard asset owners.
Yes, gold has done well. Real estate has done well. Uh those types of assets have generally done well during high inflation periods. Stocks have also done well. Um some better than others in high inflation periods. Let's go to the flip side. Kevin War says, "Okay, inflation is a problem. I am concerned about the dollar. Uh I don't care about the economy. I'm gonna raise interest rates to bring inflation down. Maybe oil prices continue going up. That forces them to raise rates. Maybe inflation keeps going up. That forces them to raise rates. But what happens then? That's that's another sort of tough question and it is sort of difficult to navigate as well. we would see, you mentioned this idea of sort of hard
assets and at the beginning of the year, our firm was really talking about this idea of a real money rotation. That was one of our big claims moving into Q1 is that at the end of 2025, we were seeing a lot of theoretical money, right? A lot of money flowing into companies that were in future tech AI not as a product now, but where it could be in the future into this increased electrification, right? car company is saying, "It's not the EVs we're producing now. It's the EVs we're going to produce in five years that are going to blow everything out of the water." Coming into 2026, the real money rotation was ideas on a presentation didn't cut it anymore.
What you could do in the future had to be against the backdrop of what you were doing today. Investors stopped looking towards theoretical bets. this idea of gamles on things that may happen in the future and saying, "Okay, who's looking at the future but is also making money right now?" So, you're saying if interest rates go up, people stop speculating, they want to see money. I think that idea if interest rates go up, those companies that are betting on the future that are trying to dump money into new projects, we see that start to vanish. We see a lot of those gamles or a lot of those big investments into
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actually cost you, I'll put a link to Policy Genius's form down in the description. It only takes a few minutes to complete, and it'll give you an actual quote on how much term life insurance will actually cost you. And I have that link for you down in the description. Between 2020 and 2022, we had the lowest interest rates in the history of time. Money was being pumped into the economy. And now all these banks and institutions on Wall Street essentially said we can borrow money for essentially free. Yeah, let's do that because every investment institution wants money to invest. If we can borrow money for, let's just say 2%. If we get a 4% return on our money, we just doubled our money and we're getting this money for free.
So let's go borrow millions, billions of dollars and let's just find investments. And so during that time when interest rates were low, Wall Street firms were investing into any and every company that they could justify. I mean you could just present an idea to Wall Street and you were able to get money. Oh yeah. And we saw the benefit of that because well as a back then we were a media company. Back then we were briefs media and we published a newsletter called market briefs. Well, we made money on our market briefs newsletter through advertisements. So now all of a sudden when all these quote unquote tech companies and quote unquote any company in the world, shoe companies, clothing
companies, dog food companies, you name it, they were borrowing and getting huge valuations because every investment firm was throwing money at these startups. So now these startups now all of a sudden had these huge marketing budgets that they had to fill. And so then they would come to companies like us and say hey we have this advertising budget we want to advertise and advertising rates were high for everybody. So for our newsletter for advertisements on YouTube advertisements on TV commercials billboards I mean people were advertising money everywhere because they had so much money because interest rates were low investment institutions had so much money and they were just pouring it into these companies. 2022
came and in 2022 that was when the Federal Reserve Bank started raising interest rates because inflation is now a problem. As soon as interest rates went up the media industry got demolished. We were very fortunate that we put aside a savings cushion because I kind of had this feeling that this is not sustainable. And we saw companies go bankrupt left and right, layoffs left and right in the media industry because the media industry that relies on advertising now all of a sudden had nobody willing to pay money in advertising because all these companies that were getting this venture capital funding, this investment funding, and it all disappeared. And so what you're saying is when interest rates go up, speculative investments go down
because now if I have to borrow money at seven or eight percent, I need a 16% return. And I want to see your profit. I want to see how you're growing. I want to see real results, not a idea and hope and prayer. I want to see actual results. And so as an investor with higher interest rates, value investments tend to do better. cash gets higher rates of interest. So, it's a kind of a different investing model than with the lower interest rates. You have to be careful with some of that, too, though, because it's not just investors are pulling back money. It's also larger corporations that are investing in themselves or investing in new products. And so you might actually
see a major grocery store chain, a major automotive maker, uh, anything in the manufacturing sector take a bit of a hit because they actually announced they're cancelling this project they've been sinking money into for 1015 years because they can't afford it anymore. Yeah. Uh, an example of this is Hyundai just announced they're stepping out of the EV space. uh it was one of the major Asian uh automotive companies announced they're they're pulling out of the EV space and they're going to you know scale back into more plug-in hybrids and the models they already have that are successful. There's this short-term effect and this long-term effect of any of these things and I think energy is actually a good example.
People right now are feeling the effect of energy costs at the pump, right? They're seeing it in the price of gas. They are not yet seeing it in the price of their car, but they will because it is affecting current production which is affecting future purchasing. You might see the price of gas and say, "I bet everybody who bought an EV feels pretty good right now." You know, they're still paying a slightly elevated energy cost, but not anywhere near what the price of gas has gone up to. Yeah. $2 gas to now $4, $5 gas. Exactly. Well, yes, if you already have an EV. But what it also means is that these major automotive companies that are trying to build new EVs, more efficient ones, better batteries, longer
range, they're scrapping a lot of those projects because the increase in energy cost hits their margins across the board. They're making less money. There's less money sort of available to them to put into these sort of things. Interest rates go up. This is just with the cost of energy. Oh, so just because of just with the cost of energy, right? So higher oil costs that it's harder to make new factories, it's harder to buy new equipment, it's harder to do all of those things just from the cost of energy. And because energy is a vague term.
Yes. The price of oil, the price of oil as it rises and it affects all other sorts of energy as well, right? Because demand for natural gas goes up. Demand for green energies go up as well. The price of oil affects everything. Higher oil costs mean all energy costs go up. Yes. Means all energy costs go up, which means all manufacturing costs goes up as well. So the cost to produce a car goes up and that's going to hit us way downstream on the production line. So we're thinking 6 months down the road,
6 months, 12 months, 18 months down the road, we're still going to be feeling the effect of that. Now imagine it's not energy costs, it's the flow of capital. It's not just manufacturing costs. When oil goes up, manufacturing cost goes up. When interest rates go up, the cost of money goes up, right? the ability to acquire money, to take out loans, to place bets on things goes up across the board. So now it's not just automotive companies making new types of cars. It's every major company out there looking to start something new, invest in something new, acquire a different company, acquire a competitor. All of that starts to go away.
Well, what happens then if the cost of money goes up, interest rates go up, people stop buying cars? Yeah. because they can't afford it. And so now you as the car manufacturer cannot sell your cars because it's so expensive. At which point now do you have to sell your car at a discount in order for me to be able to afford the car? Like is there ever a point we're going to see lower prices? Well, but they can't, right? Because they can't afford to take that hit to the margin. It's more likely that they start to trim down their companies as a whole decrease the cost of the vehicle. So rather than the price of the vehicle
going down, you'll still start to see them do layoffs. You'll see executives start to take $1 salaries until the economy turns around. You start to see an economics, you're basically describing an economic slowdown. And when the field of economics was new, it was a shock. Uh it was a it was back in Victorian England. Economists were seeing an economic slowdown. People weren't spending money. Well, they had heard scary news and they were starting to hoard money to have a store just in case. And so what was happening? Well, the stores were getting less money spent at them. So the owners were worried about the economy, so they would start to hoard more of their own money. And it's this cycle where it slows down the
entire economy that is only solved by stimulus. You have to make people less afraid to spend money to get them to spend more money. you have to make them less worried about acquiring more money in the future. And it was a shock. Early economists had never even thought that people might save their money. They had assumed everyone would spend whatever they were bringing in. And I know that feels crazy now because we, you know, we talk about finance and saving money and building generational wealth. That wasn't something that was factored into the early economy. Now, if you start to see that economic slowdown, if you see less people buy cars, margins are already tight. You already have these
companies that are in those cycles of low interest rates where money is abundant. They hire a lot of people. They launch a lot of new divisions. They try to give themselves that competitive edge so that they can kind of edge out the competition, increase market share. But those things take decades and a lot of them don't work right. And so you start to see those gambles pulled back on. You start to see layoffs. You start to see kind of pairing down. But the reality is the way they're built, they can't just slash the price of the F-150 and start to see more sales. They would have to put it so low that they'd lose money on the car. And this is where things get even more interesting today when you start
factoring in AI and what AI is going to do to the economy, jobs, and the prices of things. But I also want to remind everyone that if they are an investor or want to be an investor, we have a free investing master class where I walk you through how you can find hidden investment opportunities and I actually go over our firm's framework on how we research stocks and how you identify investment opportunities. It's a free master class and when you sign up for it, you're also going to get access to market briefs which is my newsletter for investors. It's all completely free. So if you want to get the investing master class and market briefs all for free, I have that link for you down in the description.
But now let's factor AI into this because you were telling me that now I thought this was already true, but you're saying now there's official data saying that AI is leading to job losses. Why is that such a surprise for people? And what does that mean is coming? Well, it's a surprise for people because less than 6 months ago, there were reports that AI wasn't affecting the job market, at least not yet. So these reports are like slow to get real data. We're seeing a lot of kind of instant turnarounds. Uh we saw right before the whole Iran debacle, we saw what people were calling the SAS apocalypse where Anthropic did this big presentation and showed that you know Claude was reaching
this new level where it could essentially replace software companies. So why would you ever have software as a service when you could just make it in Claude? I want to just highlight that for a second because I don't want to glance over that these SAS the SAS apocalypse was previous to the year 2026 software companies were considered like the holy grail of investments. Yeah. Specifically SAS. SAS stands for software as a service because if you needed the software to run your company, you would pay for the software every month, every year forever. like it was like a reoccurring revenue forever. Like we everyone's seen like subscription revenue and subscription payments. Everything is on subscription now. Well, with these SAS companies, it
was so lucrative because a software company would say, "Hey, you're a business. You need to do this thing. You need to run payroll." For example, you're going to pay us $1,000 a month to run your payroll. Well, me as a business, I have to do that. So, I'm going to pay $1,000 every single month in order to do that. Now you layer on your lead generation software. You layer on you know whatever management software that you have in. And so these software companies now have built these revenue streams where they would work so hard to acquire more customers and this customer would pay them forever. And so they were looked at as a holy grail of investing because they had this steady reoccurring revenue that would just always keep going up.
Then came AI and at first everyone was like, "Oh, AI is not that smart. It's kind of stupid." And slowly it starts to get a little bit better. And in 2026, AI started to get smart, quote unquote smart. And it got to the point where people that were more sophisticated on the AI side said, "I don't need to pay this software company $1,000 a month. I can just go to Claude or ChateBT or whatever and I can build it myself for $5,000, whatever the cost is, and now I can just build my own software and I don't have to pay the software fee. And so we saw these software companies for the first time see the revenues go like this because users were falling. And that created a panic on Wall Street where like you said it was
called the SAS apocalypse because these software companies saw their stocks just tank not because they became worthless but because investors panicked. People love panicking on Wall Street when they started to see users fall. And so then people obviously panicked and then those stocks fell like crazy. And now people are saying well maybe the SAS apocalypse is not going to be as bad as we thought. Others are saying it's going to be worse than we thought. That's to be determined. But what we're seeing is AI is getting smarter where people don't need as much softwares or other stuff that they did before.
I can give you a direct example of this. Uh first, one of the things that also sort of makes software or SAS companies the holy grail is they essentially have no overhead cost. They have development costs, but once the software is made, you have to spend some maintenance costs and you know, keep it up to date and patch it and you have to pay for salespeople and outreach and marketing profit. Yes, it's six the profit the you know sort of price to equity on those companies is tends to be massive. What is price to equity? It is the amount of money you are paying for what actually is held in equity by the company. So it's when you strip away
all debts and obligations what is actually left in the company's value that is sort of represented by the think about the valuation side of the company. Yeah. Is what that does look like is and it looks great in software. And so you start to see software companies, they had probably been inflated for a while because they're so lucrative and because they leave so much sort of left at the end of the day that can be distributed back to shareholders. They were trading at very high premiums and had been for a long time. So high multiples, high valuations. Yeah. That starts to get into that like price to earnings, right? The amount of what you're paying to what they're bringing in tended to be very high.
Yeah. Now, the SAS apocalypse has recovered a little bit. Uh, a lot of bit. It's sort of been bouncing back. We're seeing those software companies bounce back. And it's that's a big reason why is because even if they are threatened by AI, AI really isn't quite there yet. Not in the way that it needs to be. A lot of these bigger businesses are so dependent on your the software, as you mentioned, that you cannot just pull that software out and replace it with AI. That's a very big deal. So, they'll have those long-term customers for a long time. And again, without a high overhead cost, they can afford to slim down. They can sort of future proof themselves a little bit by cutting costs and then adapting
AI themselves. And we're seeing that one of the fastest adopters of AI is Salesforce. Uh they've been looking to integrate AI into their company for a very, very long time because they know that the basis of the idea of like a CRM will just eventually get wiped out by AI. Mhm. The flip side of that is a long time ago I worked for a company that was in uh what's in called ERP or enterprise resource planning software. And it is rather than tracking where if you're in manufacturing and you need to take orders from customers and then send it to your warehouse or wherever you keep materials and then get those shipped over to the factory that actually makes the thing and then ship it back to the
customer. For a long time, those orders and where they were in their status were being tracked on whiteboards or in Excel sheets or in at least one company's case, they were printing out Excel sheets and then filling them out by hand and they had them stapled to a corkboard. Not a great solution. Enterprise resource planning was just a software that handled that. It would just integrate into your whole network and it would show you where each order is in the process. A lot of the newer ones would connect directly to machines. So you could see if your like CNC machine was running a process right then and there. All of that can now be done by AI. If you know what you're doing, you can replace enterprise resource
planning software with claude chat GPT whatever you know pick your poison pay for the enterprise level and you can just do that. Now it's very difficult to again rip out if you've been on say Plex for 50 years. It's it's difficult to rip that out of your company, but if you're a new company, why would you ever pay for this software? Why wouldn't you just pay one guy that knows AI to come in and redesign it for you? So, yes, there's this idea that they know it's coming, right? Software companies know it's coming and it's going to be this big overhauling thing and they're trying to get ahead of it, but they're also disappearing. Smaller software companies are disappearing. You have to have, going back to the idea of
rates, you have to have the liquidity. You have to be able to take loans. You have to be able to handle development costs to try to integrate AI to try to find new ways to keep your customers and serve your customers or you're going to be gone in the next five, six years. Yeah. I mean uh the big thing was if you want to start a company, start a software company because you can get a very high valuation, you can raise millions of dollars, then the goal is to take those millions of dollars that you raise, acquire customers as fast as possible, even if you're losing money because then you can raise more dollars. And eventually, if you keep doing that, you're going to get to the point where
the early customers that you got in at a huge loss are going to start being profitable. Then the second wave will be profitable, the third wave. And so if you keep doing that, now you could be a huge company that becomes profitable because your early customers, which lost money, eventually start to pay for the new customers that you acquire and now you were a profitable company. But that only works if people are willing to invest money into you. People invest money into you if interest rates are lower. When interest rates are lower, they're willing to give you higher valuations and they're willing to be more free with their investments. If interest rates go up, and they're they're higher today than where they
were 5 years ago. Uh if interest rates stay high, investors say, "I don't want to take as risky of a bet. Show me the numbers." And you as a software company say, "I don't have the numbers. I need your money to get you the numbers." The investor says, "Too bad. Now it's not only show me the numbers, it's how are you going to compete against AI?" And now a lot of software companies are saying, "Uh, we can't." And that's what caused a number of smaller software companies to disappear because number one, they couldn't get more money. And then it became even harder to get more money when AI came in. And now they're not just competing against other software companies, they're competing
against AI. we could make this very real very quickly knowing as you've described it this idea of yes I will acquire customers I can get the super high valuation because you know that my customers eventually their lifetime value of that payment time and time again will exceed the cost and I've got this huge customer base already that is just money waiting to happen knowing that five years ago you as an investor you hear that and you have these other examples of companies where that's been successful that Sounds like a pretty good investment right now. Layer your AI knowledge on top of that. Would you today in this circumstance invest money into a software company into a company where sure they have the user base, but
they might get wiped out by AI before it starts to be profitable? Yeah. It doesn't sound very attractive. No. And so, not only are we seeing higher interest rates than when there was this big tech boom, we're seeing the sort of existential threat of AI. We're seeing public attention move into AI. AI isn't some small thing that people don't know about that might eventually wipe this out. At this point, it is a sort of household term. And we've seen these kind of wipeouts happen in the past. Advertising major creative agencies, these sort of Madison Avenue, New York ad agencies, once Google and Meta started working in the ad space, in the media buy space, their days were numbered. It was a more effective model. It was a substantially
cheaper model. there was no way they were going to survive. And you know the funny thing is they said, "Oh, these social media advertisings models are stupid. Why would you advertise on Meta or Google stick with the traditional model?" Like you get kind of stuck into the old mindset of not believing that there's any opportunity in the new way of advertising. And the problem with that is sure I mean the pitch sounds great year one, right? Oh, they just are going to use some computer metric to find a place that's going to be a profitable ad for you. We've got a guy who wins award after award and he's gonna sit there by hand. He's going to guide you through it. He's going to craft a campaign that
some computer never could. Well, that guy costs, you know, millions of dollars a year to have on your team. Is the Google ad as fancy as his would be? Is it as fun? Is it as memorable? Absolutely not. It's targeting the right people and it costs you, you know, pennies on the dollar at that point. And so, you actually experiment a little bit. You have companies put a little bit of money into each. They keep their advertiser. They bring on like a meta ad segment to see how it goes. They get their ROI statements into the year. They're keeping their books. Well, the Google ad, the meta ad outperformed the ad agency billboard placement, you know,
a hundred times over. What are you going to put money into? And that was a field where it wasn't as much of a household name. You couldn't go into somebody five years ago and say, "Hey, have you heard of uh Meta ad placements? Have you heard of like the algorithm that Meta is using to place ads into people's Instagram feeds?" Now, you're like, "What are you talking about?" It still overtook that industry. We're talking about a massive acceleration. We're talking about a product and a technology that not only is transformative, but everyone knows it's transformative. Your grandmother probably knows what AI is or has heard
of chat GPT through some form of media. As you're talking, I start to get really kind of uh jumpy because I think about this a lot. We used to be, like I mentioned, Briefs Media. We used to be a media company. In 2025, you probably remember the meeting. I had the all hands meeting and I said, "We're going to go out of business. If we don't change, we're going to become Brief's Finance. We must become a financial technology company." Uh and so what we did was you know we publish your research uh you're going out finding investment opportunities along with our team of analysts and we're finding where money is moving and we publish that as research and I say you know content itself is no longer going to be our
business. Yes you're going out and getting research that's not on the internet. Yeah you're going out getting research that's not on chatbt. All that is great but just purely as a research company we're not going to be able to survive unless we integrate technology and AI into our business. And at first everyone's like, "What do you mean? Like AI is still this new thing. How is it really going to change things?" Fast forward to today, AI has transformed our company. It's transformed our research. It's transformed our products. And we have some amazing tech products now for our investors through the AI that we built. I see what it's done in our company. I see how it's changed how
we hire people. And I see what it's going to be doing. And now I go out and I start talking to people, people that are kind of doing, you know, regular white collar jobs, desk jobs or doing it on the computer, and I talk to them about their concerns about AI. And a common response that I'm still getting is, I've used chat GPT, it's really not that good. And I hear that and I get scared for them because number one, if all you've used is chatbt, your knowledge is extremely limited. If all you're using chatbt for is to help draft your emails, oh my god, go watch a YouTube video on how you can make your AI better or go ask chatd what you can do. And I wonder now like what does that mean for the average white
collar worker? And it doesn't just have to be like a uh Excel data entry person. I'm talking attorneys. I'm talking accountants. I'm talking bookkeepers. I'm talking really anybody who sits in front of a desk in front of a computer and does a job. Like essentially anybody who was part of like the remote work movement. If you are able to do your job on a computer, how long is it until AI can do the job? 80% of as good as you can. Do you want an honest answer? Six months ago. If we're being honest, it's it's there.
The problem is adoption and implementation. I've run into the same thing you have where people just think chat GBT is AI and they're they're going to it and just saying, "Hey, can you do my job for me?" And they're being very vague and they're not using any sort of modern prompting technique or any experience. And that's the equivalent of riding a horse your whole life, getting into a car, and yelling, "Giddy up." Like, obviously, it's not going to work. Or if you're in neutral trying to push it down a hill, that's it's not a good vehicle. If you understand the tool and understand how to do it, it can do so many things. I use AI every day. I work
very closely with a lot of people on Wall Street and a lot of them are getting the same results out of an entire floor of people doing quantitative analysis that I can get out of an AI for whatever the cost of tokens is. And I'm not even like a token power user in the office here. And again, we're replacing probably at least a quarter million dollars in staff on quantitative analysis through the use of AI without particularly advanced tools, just a little bit of domain expertise and working with it for a while. Well, I think expertise now is subjective because what you're saying is you're seeing the power of it. You've learned how to use it and you are actively building tools. I want to build a visualization because I think some of what you've said can be a little
bit difficult to comprehend. We have computer stations in our office today that act as humans and so our head of AI kind of built this I don't know what to call it AI agent robot whatever and so you want to do something what we used to do is used to then send it out to our developers and our developers would then read it analyze it build it and they would take their time and come back and get it back to you make mistakes and whatever. Now, what you do is you submit this piece of information of what you want to get done and you send it to the AI employee, the AI agent who's in our office. It's a desk, it's a computer, it's a monitor, it's everything. That machine gets that and it starts running
and solving the thing. we want to build this hypothetically we want to build this website and it starts building it for you and it runs automatically and then there's a separate AI agent that edits it that views it that does the analysis of it there's a separate AI agent that confirms that it matches your specs and whatever and this happens 24 hours a day 7 days a week it doesn't require health insurance all the cost is the electricity to plug it in but this is kind of like where we are going where we're going to have many of these workstations that are just running 24 hours a day. That way when you want to get things done now, you can just send it off to your AI agent. The AI agent
does it. You send get the next thing done. You send it off to that AI agent and it does it done. That if you can do something on the computer yourself, you can train an AI agent. It takes time. It takes work to do that, but it can be done. A lot of companies just haven't gotten there yet or they don't see the costbenefit analysis yet. Some do. I mean, you've heard Jack Dorsey. Yeah. CEO of Block. I mean, I he like half of his company like 40%. To be fair, he did overhire in the first place, which he's kind of known for doing, but it's happening faster in tech than in other places. A friend of mine was in a
uh coding boot camp after college. Uh he decided he didn't want to sort of work in the field. He studied he wanted to work in computer science and coding and took a coding boot camp. It was a six-month program. They guaranteed you a job out of it. He went through six months, had a job paying six figures right out of it. And he said work was abundant. It was his pick of the litter of where he wanted to work and what he could do. And there was clear upward mobility in all of them. He decided that may not be for him and sort of took some time off, took a sabbatical, did a lot of travel, came back. He's looking for work right now and those jobs are gone. They are completely gone.
It used to be in abundance this idea of low and mid-level coding and all of that is AI now. And I was speaking to our head of AI about it this morning and he's saying those boot camps are just becoming they're shutting down. They no longer teach. Some of them are becoming placement agencies, but a lot of them are shutting down. And the truth is, data entry used to be a job you could always find because putting thousands of lines into Excel sheets is grueling work and a lot of companies would rather just hire people and actually pay pretty well to do it rather than, you know, take the time of one of their existing employees.
I can't imagine a world where you would ever need to hire someone in data entry anymore because AI can do it not only much faster, but they're going to make mistakes at a lower rate than the humans are. And when you catch the mistakes, they can redo the entire thing in minutes as opposed to taking hours to sit there. And that's what worries me is, you know, you start to tie in everything we talked about together. Our economy is at a crossroads. We don't know what's coming next. We don't know if it's ever going to be higher interest rates, lower interest rates. We don't know where oil prices are going to go, but we can envision that there's going to be volatility in the economy. Good for some people, good for the
financially educated, great for our firm. The average person hates volatility. The average person just looking at the 401k who doesn't know how volatility works, it stresses them out. Now, the economy could boom. It could kind of just grow steadily or it can hurt. One of those three things are going to happen. Which one we don't know, but we know it's going to be a mix of all three over the next 10 years. Layer in now AI. I don't have any doubt in my mind that in the short term, the next five years, we're going to see job losses with AI. Maybe in the long term it will create more jobs, but I truly believe that as companies start to adopt AI,
they're going to need less human workers. Those human workers are then going to go through a period of what do I do? I must learn AI. So there's going to be this adoption curve. And during that adoption phase, there's going to be less people working, less people needed for jobs. Hopefully then come 5 years later like every time in the past it will create more jobs. That's what all the AI companies are saying. What is that going to mean for the economy? I don't know. But I think the best piece of advice that I can give and maybe you would agree or disagree is learn AI. Protect yourself. I mean arm yourself with this knowledge because we did a study in market briefs recently and what was it like 50% of people still are not
using AI. It something like that. It was it was pretty shocking. 50% of people are not using AI. I think it was 30% are like I occasionally use AI. There is still time to learn and arm yourself and job security or income security just to be able to protect yourself. But it also creates investment opportunities like understanding we've talked about this a lot in your research. It's not just investing in the AI, it's understanding the layers of AI, right? It's it's okay. There's AI, but then the AI needs data centers. The AI needs semiconductors. The AI needs certain metals. Yeah. The AI needs cooling companies have to cool the data centers. The AI might need nuclear energy, right? And so it's understanding these layers and how those
can create investment opportunities. Has obviously been very lucrative for your research and our firm uh with the opportunities that you found, but that's what I would recommend. Would you agree that's Yes. So learning AI is something we're all going to have to do if you can either do it now and get ahead of the curve a little bit or you can do it later and be trying to play catch-up. It's going to happen one way or another. You're going to have to learn AI. Um I would say we can give a little bonus to anybody who's listening to me rant on AI and the economy for however long we've been at this. Uh and I would
say that one of the best strategies that we're employing here is actually what we call iron and lumber investing. uh which is a lot of people are familiar with the idea of like pick and shovel investing where you don't during the gold rush most of the people trying to mine gold ended up going broke buying bad land so on and so forth. Companies that sold them pick and shovels uh made a killing. They did very well. Yeah. We take that a step further and we say okay well you make picks and shovels out of iron and lumber. So who is providing the iron and the lumber into the pick and shovel companies? You can replace white collar workers all day. You're
doing it with something that requires various materials that come out of the ground or you know water or energy. These sort of raw resources. Companies that control these raw resources are going to be insulated from this sort of thing because they are still sort of powering the economy. It's this idea as you said of like hard assets. It is what do you need to run AI? There is a physical component. There is physical bottlenecks. We have to pull things out of the ground to make that happen. The companies that control the flow of those things are going to be relatively solid investments as the economy goes in this new direction. They're already pretty good investments and have been for a
while. And what they sell is just becoming a more and more important part of the economy. So, not going to name drop any companies here, but this idea of find where those material bottlenecks are. find what does a company have to pull out of the ground to make chat GPT work and then look at how much of it they need. Are they going to need more of it in the future? Is it something that they can just kind of invent around or reduce? A lot of time the answer is no or at least it's no until AI figures out a way to you know get around that restriction. But I would say yes, absolutely learn AI and look at materials, look at minerals and energy and water and all of these things that
aren't technologically based and can't just be, you know, you can't ask a chatbot how to power itself without any materials, right? Well, I appreciate that, Jackson. Again, uh if you want more, you can read our free newsletter, Market Briefs. I have that link with our master class down in the description. Uh, if you want to see our firm's research, we do sell pro research. You can read more about that on our website, briefs.co. Thank you, Jackson, for your time. It was always very insightful conversation. I appreciate it.
Thank you. We're counting down towards some big catastrophic event. Uh, the dollar is becoming more vulnerable. It's approaching some sort of black swan event or major economic change threatening its reserve status. If you look past the surface level, the Chinese connection in all of these events goes much deeper than people realize it
