May 24, 2025 • 34 mins
Check out the feed of our sister podcast Everybody's Business in any podcast app of your choice. After several week's of cross publishing, in the future you're going to have to head to that feed to enjoy the show. But for now...
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All the economy is a stage this week, as the “big beautiful” tax bill passed the House in the wee hours of Thursday morning, and millions of college graduates got their diplomas and set off into the the job market, competing with an ever growing army of robot workers.
In the second episode of Everybody’s Business from Bloomberg Businessweek, hosts Stacey Vanek Smith and Max Chafkin dive into the tax bill, the AI job threat, and the turning of (actual) lead into (actual) gold.
The tax cut extension still has to pass the Senate, but the House version would add roughly $4 trillion to the deficit over the next decade, and would be, by far, the most expensive policy the Trump administration has enacted. In spite of this, the tax bill has not gotten nearly the attention of other policies, including the Department of Government Efficiency (its cuts have not amounted to even 1% of the federal budget). But all the sound and fury signifying a rounding error is by design according to author and economic journalist Kyla Scanlon. Scanlon says you can learn a lot about the Trump Administration’s economic policies by watching Wrestlemania.
Then Bloomberg reporter Sarah Frier joins to talk about AI and jobs. Fears are growing in the US workforce that jobs are being lost to artificial intelligence, and a new study estimates up to ⅓ of jobs in developed countries will be “transformed” by AI. Frier looks at what jobs might be under threat and how real the worries are.
Finally, Stacey and Max talk about a major development in commodities markets. Scientists were able to turn lead into gold! Stacey thinks this could be a turning point for the gold market and all mankind. Max has doubts…after all, all that glitters is not gold.
See omnystudio.com/listener for privacy information.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:02):
Bloomberg Audio Studios, podcasts, radio news.
Speaker 2 (00:10):
This is Everybody's business.
Speaker 3 (00:11):
I'm Max Chapkins and I'm Stacey Vnnix Smith. Hey, Stacy, Hello, Max,
how are you.
Speaker 2 (00:16):
I'm good.
Speaker 4 (00:18):
I've just been thinking that all the world is a
stage and the economy is no exception. We have got
this week the congressional theater around the tax cut extension,
the big beautiful bill.
Speaker 2 (00:32):
Yeah, they've got a lot packed into this bill, tax
cuts that are gonna potentially save people a lot of money,
but also trillions of dollars that could be added to
our country's debt.
Speaker 4 (00:43):
But why think about that, Max, when you could think
about WrestleMania.
Speaker 2 (00:48):
Oh wow.
Speaker 4 (00:51):
We have got economic writer Kylo Scanlon on to talk
about how much you can learn about Trump's approach to
the economy by watching WWE.
Speaker 2 (00:59):
And I've read this everywhere. AI is coming for your job, abraded.
We're going to actually try to get into what that means.
Speaker 4 (01:06):
And we have a little actual magic in our underrated
story of the week.
Speaker 2 (01:11):
So, Stacy, this is the week many college graduations happen.
We have four million college students graduating in the United States.
Many of those folks, of course going to be getting
their first jobs really soon, they hope their parents hope.
Speaker 4 (01:25):
Yes, exactly, and this is a strange, possibly difficult time
to be coming onto the job market. A lot of
people economists are calling this a frozen job market, meaning
unemployment is near historic lows, but hiring levels are too.
Speaker 2 (01:38):
You know, look at the unemployment level for college graduates.
It's you know, it's almost six percent, which is low,
but it's not it's not that low.
Speaker 3 (01:45):
Yeah, it's always a little higher for recent college graduate.
It's a little bit of a tougher.
Speaker 2 (01:49):
Game, Stacy. This of course is a part of the
show where we go out into the world talk to
some people, ask them how the world of business, the
economy is affecting them. Where did you go this week?
I wanted to.
Speaker 4 (02:02):
Talk to these recent college grads, see what was going on,
how many of them had jobs, how they were feeling
about the job market. We're pretty close to Columbia University.
Their graduation was this week and I went to the
campus congratulations to the twenty twenty five class of Columbia Journalism.
(02:23):
Everyone was running around and graduation robes. They were taking
pictures with their parents. They were like holding big bouquets
and hugging each other.
Speaker 3 (02:30):
It was really sweet.
Speaker 2 (02:31):
They're all hungover also, by the way.
Speaker 4 (02:33):
I did not think about that, but possibly I went
to ask them, like, how do you feel venturing out
into the job market and what is going on?
Speaker 3 (02:40):
I'm a graduate student in computer science. Do you have
a job?
Speaker 2 (02:44):
Oh? Yeah, I do.
Speaker 3 (02:45):
I got like cape to.
Speaker 4 (02:46):
Be honest among your friends, like how many have jobs?
How many are still looking?
Speaker 2 (02:50):
In computer science?
Speaker 3 (02:51):
Approximately sixty to seventy percent have jobs.
Speaker 5 (02:54):
I studied epudymiology.
Speaker 3 (02:56):
Do you have a job right now?
Speaker 2 (02:57):
No?
Speaker 3 (02:58):
I did not. How's the job market fell extremely hard?
Speaker 1 (03:01):
I was mainly aiming for labs in different universities, but
universities are cutting phones.
Speaker 3 (03:08):
How's your job market for electrical engineering?
Speaker 6 (03:10):
Just terrible?
Speaker 2 (03:11):
The market is super terrible right now. Everyone will search.
Speaker 3 (03:14):
AI affect your field at all.
Speaker 5 (03:16):
AI is a tricky subject because it really does help
a lot, and in other ways it's detrimental to a
lot of job security. It's kind of fifty to fifty.
Speaker 4 (03:28):
I use AIA every day, fly the way, So you're
using AI to code?
Speaker 2 (03:32):
Yeah, almost every day. Actually a lot of people are
doing these days. I just want to know how many
his kids are using chat GPT to write their essays,
because you know that guy's like I use it to code.
I don't know.
Speaker 3 (03:45):
Well, you know, he was a software engineer. He has
a job.
Speaker 4 (03:48):
But I was pretty shocked that like thirty forty percent
of software engineering grads did not have jobs that he
talked to when a lot of people were really pessimistic.
A lot of people did not want to talk to
me about this.
Speaker 2 (04:00):
You know, I feel like it's always like this for
college graduates, or maybe this is just my adulthood or whatever,
but like, you know, the economy's changing. You're coming in
there with a limited network. I mean, even even these
Columbia students, who of course have a huge leg up
from a normal person. But yeah, I mean it's it's scary,
but you know, I'm excited for them.
Speaker 3 (04:20):
I'm excited for them too. Of course, we wish them well.
Speaker 2 (04:23):
We're gonna hopefully later in the show put some data
to this question of job loss, really get to specifics,
but we definitely want to hear what you all think.
How big an impact is technology having on the job market,
Like are you using AI in your job? Do you
think AI can replace you? Do you like me think
it's a total bunch of bs and like, oh my god, whatever, Like,
(04:46):
let us know, Stacey, we had so many good emails
this week.
Speaker 3 (04:49):
Yes, we did.
Speaker 4 (04:50):
We had great emails this week, and we're going to
be talking about them in future shows.
Speaker 3 (04:54):
But please keep the emails coming. We want to know
what you want to hear about.
Speaker 2 (04:57):
Yeah, that address, everybody's at Bloomberg dot that's everybody's with
an s at Bloomberg dot net. Just real quick, Stacy,
I got to tell you we had a couple requests
in in terms of future episodes about insurance. Do you
believe that? So?
Speaker 3 (05:09):
Alex a listener insurance is fascinating, wants to.
Speaker 2 (05:12):
Know why insurance is getting so expensive, why car insurance
is getting so expensive? Will wants to hear about the
kind of voting rights control at Berkshire Hathaway. Marita asked
about the bond markets. I know we'll hit that, and
a listener named josh gave us a note that I'd say,
is are bordering on NC seventeen rated that I'm not
(05:33):
going to give, but without business, we do appreciate it. Joshua.
Speaker 4 (05:37):
Yeah, apparently glazing does not mean what we think it means.
Speaker 2 (05:45):
The big story this week is this tax bill. The
House worked hard to pass a version of the bill,
the Big Beautiful Bill, just before the long weekend. It's
an extension essentially of the twenty seventeen tax cuts that
Trump put in place during his administration and that we're
said to expire.
Speaker 4 (06:02):
Yeah, the amounts of money that we're talking about are huge.
We're talking around four trillion dollars over the next ten years.
And to put that in perspective, our entire budget, what
it costs to run the entire country, is about seven
trillion dollars a year. So it's just the amounts of
money aren't enormous and even potentially quite destabilizing. Obviously, it's
(06:24):
going to add to our debt, which is already pretty substantial.
Speaker 2 (06:27):
Yeah, this is confusing, particularly because we were talking in
this country just a couple of weeks ago about all
the cuts we're making, and now all of a sudden,
there's a huge deficit. There are some cuts in the bill,
cuts to medicaid, food aid, clean energy. It's a lot
of really important stuff, stuff that people care about.
Speaker 4 (06:46):
The problem I think with a lot of these issues
is that it gets a little bit dry and boring.
I hate to say that, because it is really important,
but it's a little bit boring tax policy. When you're
talking about pass throughs, tax brackets, state and local policy,
it's a lot less exciting to talk about.
Speaker 2 (07:01):
Than doge or than professional wrestling.
Speaker 4 (07:04):
Everything's less exciting to talk about them professional wrestling. And
according to Kyla Scanlon, author of In This Economy and
ECON blogger Extraordinaire, WrestleMania has taken over the US economy
and the tax cut is the perfect example of what
is going on.
Speaker 3 (07:21):
She joins us, Now, Hi, Kyla, Hey, how's it good? Good?
Thanks for talking with us. So, Kyla, you talk in.
Speaker 4 (07:28):
One of your latest sub stacks and videos that you
made about this economic policy aligning with something called k
fabe in wrestling.
Speaker 3 (07:37):
What is k fabe and how does this apply to taxes?
Speaker 2 (07:42):
Yeah?
Speaker 1 (07:43):
So, k fabe is staged reality. So if you ever
watched WrestleMania or anything like that, the wrestlers have these
personas that they take on and they act out these
really elaborate like wrestle moves, pile drivers, things like that,
and they even act like that off the wrestle matt
and it's just this idea that the whole reality is
(08:04):
fake more or less, but it looks incredibly real. The
world of wrestling by Roland Bars was the big inspiration
behind that piece, and he sort of talks about.
Speaker 3 (08:13):
Roland Bars like the philosopher linguist.
Speaker 1 (08:16):
Yeah, so he wrote this incredible piece that talks all
about how you know, wrestling and this sense of justice
and the sense of morality, and like, in order to
really have a narrative, like you have to have these
good guys and these bad guys, and you have to
have k fabe. And so the analogy comparing WrestleMania essentially
to the US government, where we have a lot of posturing,
(08:37):
big chair slams on people's heads, Like a lot of
it seems staged in order to make some sort of point,
specifically with regards to tariffs. But the tax bill could
definitely be k fabe too. And so I think that
the current administration just because of the background of Trump
in WWE, in reality TV, like the guy is an
attention merchant, right, He's really good at it, and I
(09:00):
think it's carrying over.
Speaker 2 (09:01):
Speaking of that, we got to play this clip for
people who haven't heard it.
Speaker 3 (09:04):
Oh my god, So I was looking around.
Speaker 4 (09:06):
I vaguely remembered I used to watch wrestling back in
the day, and I remembered vaguely that Trump had been on.
But of course, with the magic of the Internet, I
looked it up, and I have to say I was
like a little bit mind blown. We have a clip
of Donald Trump. Basically it's part of the something called
the Battle of the Billionaires, but it was a wrestling
match where Trump was in it.
Speaker 1 (09:30):
Often.
Speaker 2 (09:31):
So Trump is like walking around.
Speaker 4 (09:32):
The ring, yeah, and he's like on the edge of
the ring, and then he jumps in and starts beating
up this this other man, this other fighter, Vince McMahon.
Speaker 2 (09:41):
Yeah, he's beating up Vince McMahon, who was the CEO
of WWE also, by the way, the husband of the
current sectarification. Yeah.
Speaker 3 (09:51):
I mean, it's it's it's wild.
Speaker 4 (09:55):
I mean, one thing that that is coming into my mind,
especially around the tax us, is all of the theater
with Doge and the government cuts. And I read that
all of the cuts that have been made by Elon
Musk and Doge amount to just a fraction, a tiny,
tiny fraction of one percent of the budget. Meanwhile, the
tax bill, which has had some drama around it, but
(10:17):
way less than Doge. We've just talked about it, way less.
You know, the implications economically are enormous. I mean that
also seems like it kind of falls under this k
fabe philosophy.
Speaker 1 (10:32):
Yeah, I mean I think there's an element of that.
Like Doge was very public, Like they had their own
Twitter account, They had those guys on the front lines
doing interviews all over the place. Elon Musk was in
charge of Doze, even though I think he says he isn't,
and so they were very you know, intentionally in the
public eye, which is probably why they got more pressed
in media.
Speaker 2 (10:51):
I like the analogy for Doge too, because you know,
Silicon Valley, you guys both probably know this, but like
Silicon Valley is super into k fabe as a term.
I spent spent a lot of time when I was
writing my book listening to Peter Teele and Teal talks
about kfab all the time. I feel like with Doge,
they were in costumes and the crazy thing to me, though,
is it worked right. There were like budget experts saying like, hey,
(11:14):
these guys are never going to get anywhere near two
trillion dollars Nonetheless, you had like Jamie Diamond and people
I think who are very smart and very sophisticated, essentially saying, oh,
this is great, like basically talking as if we'd entered
this era of austerity. Meanwhile, over here in the middle
of the night, they're planning this tax cut that's going
to add a huge amount of money to the federal budgets,
(11:36):
doing the exact opposite thing that if you were watching
the show that was on TV, that was the story
you were being told.
Speaker 1 (11:43):
I think that that distraction is the ultimate tool. And
I know I sound like a little bit of a
conspiracy theorist story when I talk about this stuff, but
I think hidden in this tax bill is a bunch
of stuff that can really hurt a lot of people,
especially in terms of healthcare access and in terms of
just affordability. And so I think for the government, like
having this sort of dramatic sparring, you know, Trump tweeted
(12:07):
or truth whatever about you know, the government selling Freddie
May and Fannie mack on, you know, the morning of
this beautiful, big tax bill getting passed. And so I
think there's always some element of distraction that comes up
when they want to have stuff slide under the rug
A bit kyla.
Speaker 2 (12:24):
I'm wondering. During the last Trump administration, the Republicans did
this thing where they drastically dialed back the deductions for
people who live in high tax states, and in certain ways, right,
that was like a understandable, sort of sensible move if
you were going to cut taxes, and now it appears
like they're poised to raise it huge amount. That seems
(12:46):
like a big part of the problem here.
Speaker 1 (12:49):
Yeah, I mean, the bill gives out a lot of
tax cuts and doesn't really think through how to pay
for them. A lot of the ideas that like, you know,
maybe turiffs will cover some of those costs, or the
cuts to Medicaid and Medicare will cover some of those costs.
I think it's a pretty short term look at that,
(13:09):
because like, sure, you can cut costs in the meantime,
but the repercussions down the road could be massively expensive.
They're also increasing taxes on like Carverard and maybeat'll cover it,
but it's incredibly expensive and it's incredibly short sighted because
the last thing that we need is more tax cuts.
Speaker 2 (13:26):
So Trump has tried to raise taxes on rich people
a few times or sort of floated it, and he
just always gets smushed basically by the Republican establishment and
big donors and stuff. I almost feel like it's because
the k fabe stuff like doesn't work on private equity managers.
Like you can't just like k fave your way into
like cutting carried interests because there are very very rich
(13:47):
people who really really don't want that to.
Speaker 3 (13:49):
Happen, and they're going to fight back. You can't really
hit them with a chair. They can afford a bigger chair.
Speaker 4 (13:54):
So just to do a little bit of counterprogramming, Kylo,
where should we be looking? Like, what should we be
focused on? With all of these performances happening? Where should
we look?
Speaker 1 (14:05):
I mean, I think the ar border of truth right now,
in my opinion, is the bond market. And so I
think that if you want sort of a story about
how the world is thinking about the United States, like
looking at the bond market is pretty useful because it
doesn't mess around, right like it's going to usually tell
some element of the truth. The bond market is not
(14:26):
happy about this.
Speaker 3 (14:26):
Big beautiful bill because of the debt.
Speaker 1 (14:28):
Yeah, Moody's downgraded the US. I think that that's pretty
useful sort of using that as a gauge.
Speaker 3 (14:35):
What signals should we be on the lookout for with
the bond market.
Speaker 1 (14:39):
Yeah, so if people are looking at the situation in
the US government and they're like, oh my gosh, I
don't know for the thirty year bond, for example, I'm
not sure how the US government's going to look in
the next thirty years. You're gonna have to pay me
so much money in order for me to buy these bonds.
Fields are going up. That's a good way to gauge
how the market is thinking about the long term viability
of the US government and how they're looking at that outlook.
Speaker 4 (15:02):
Yeah, it's kind of like if I'm in a lot
a lot of debt and go to the bank and
they might give me a loan, but they're going to
charge me a really high interest rate for it because
they're going to look at me as a really risky
person to lend money to.
Speaker 1 (15:11):
Yeah, and right now, the youth government is seeming increasingly
risky to people, especially investors.
Speaker 2 (15:18):
You hinted at this, Kyla, but like a lot of
this stuff may not survive the Senate bill. Is your
assumption that the Republicans will figure out a way to
get this passed, adding a huge amount to the debt,
or is there some chance that there are lots of
different forces pushing against this, one of which is the
bomb market that we may you know, be talking in
(15:39):
two months or three months and this thing hasn't really
gone anywhere, or they're still fighting over this or something. Yeah.
Speaker 1 (15:45):
What's sort of funny is everybody thinks they're big and
in charge until the bond market comes knocking.
Speaker 2 (15:49):
It's James Carvill, right, I want to come back as
the bomb market when I die, because everybody, everybody's afraid
of you.
Speaker 1 (15:55):
Yes, And I think it's really simple to like past
these big things and be like it's going to pay
for itself and we're going to replace income taxes the tariffs,
which is just not mathematically possible. But I absolutely think
that the bond market will let its thoughts be known
and the US government, the Treasury specifically, is going to
have to do things to appease the bond market in
(16:16):
the meantime, things that they didn't want to do that
they don't want to do, and it could get complicated
really fast if they keep on being irresponsible.
Speaker 4 (16:24):
The biggest wrestler of all the bond market. Kyla Scanlon
is the author of In This Economy. You can check
her out on substack, TikTok Instagram. She makes content every
day talks about all kinds of aspects of the economy.
Speaker 3 (16:39):
There's definitely a lot to learn.
Speaker 4 (16:41):
And it's always really fun, really unique takes much like
WrestleMania as an explanation for our economy.
Speaker 2 (16:53):
Stacey, we heard at the top of the show that
the graduates of today, the young people who will lead
us in the future, concerned about artificial intelligence. They're worried
about what it means for their jobs. And you know,
it has gotten me thinking, like, how much is this
actually happening right now? I mean, and we've seen a
(17:13):
lot of this. There's BusinessWeek has a great issue out,
the AI Issue. There's some interesting stuff in there on this.
There's also just an amazing overview of what's happening in
the market. To kind of break this down, I wanted
to bring in Sarah Fryar, who's Bloomberg's big tech editor.
She's following all of these big companies and these big investments,
(17:34):
and I think also just brings a lot of good
perspective here.
Speaker 7 (17:36):
Hey, Sarah, hi Sarah, Hi, thanks for having me so, Sarah,
there's a new genre in social media that I've been noticing,
a kind of a new form of bro atry, which
is the poetry.
Speaker 2 (17:49):
That executives right on LinkedIn, and that is the memo
warning your employees about AI. Toby Lucky of shopify I
wrote one essentially saying that everyone had to use AI
and you weren't going to be allowed to hire unless
you show that AI couldn't do it first. Mikah Kaufman
(18:10):
of Fiver wrote, AI is coming for your job. I'm
not talking about your job at five or talking aboute
that to his employees, your ability to stay in your profession.
He not only wrote it to his employees, he posted
it publicly. Sarah, can you just give us a sense?
Is this basically like conventional wisdom among the kind of
like tech CEO class that basically like, hey, we just
(18:33):
need to buckle up. The AI is going to like
replace half my staff or something. You know.
Speaker 5 (18:38):
I think it's for real that it's changing a lot
of the workforce. And I think the sentiment from the
shopif I ceo. He got really slammed on the internet
for that, for telling employees he wasn't going to give
them headcount unless he could prove that AI couldn't do
that job. That's pretty widespread right now in tech companies,
and I think that it's more of a forcing factors
(19:01):
to get their employees to fully embrace the new technology
and understand what they can do with it. Now, there
are downsides. There are obvious downsides. If you have so
much work done by AI, it gets things wrong.
Speaker 4 (19:15):
Yeah, there was just that booklist this week where like
a bunch of newspapers published like the fifteen Great Summer Reads,
and it had been generated by AI, and ten of
them weren't real books.
Speaker 2 (19:25):
There are so many examples like this, so many cautionary tails.
The one that Stacy mentioned though very bad.
Speaker 5 (19:32):
Then you have companies like Microsoft who do major rounds
of layoffs, and we looked at the numbers and Bloomberg
found that the majority of those positions the hardest hit
were software engineers. So those people graduating from college that
you noted who are worried about the workforce, of course,
they're worried because they grew up in this era of
(19:53):
everyone of our generation telling them to learn to code.
You know, they all grew up learning that STEM was
everything and that you had to be a quantitative person
in order to succeed in the modern world. Now that
may have been true ten years ago, but now there
(20:15):
are fewer entry level software jobs because so much of
entry level software can be done with AI. It's not
replacing the senior jobs, and in fact, a lot of
the code still has to be checked by someone who
actually knows what they're doing. It's going to make it
easier for someone who's an experienced developer to develop faster,
But for those entry level jobs, for those people who
(20:37):
are going to come in and learn the basics and
be put to work before before growing up, it's going
to be harder for that.
Speaker 2 (20:44):
I got to say. The New York Federal Reserve Bank
recently published a list of undergraduate majors with the highest
and lowest unemployment rates, and as English major, I have
never felt so smug in my entire life because for
decades I have been hearing this learned the code thing.
And let me tell you art history majors. Art history
(21:07):
that's like even more like irrelevant from that point of
view than you know, like.
Speaker 3 (21:13):
I mean objection, but continue I do.
Speaker 2 (21:16):
Like when somebody when somebody from the shape Rotator class
tries to make fun of us word cells. They always
pick on art history majors and unemployment rate for art
history majors three percent unemployment rate.
Speaker 5 (21:31):
Right, if you're putting your kid through college now or
through high school now, you know, forget about those coding hamps.
Teach some critical thinking, like so much about Yeah.
Speaker 2 (21:41):
You gotta know the difference between a doric column and
an ionic column or you will not get by in
this world.
Speaker 5 (21:48):
I love STEM. I think that that stuff is really
you know, engineering is really important, but you need to
be able to look at what the AI produces and
correct it. I mean that's like a key skill, and
you need to be able to use the AI in
a way that is productive. And we're seeing it's not
just Microsoft. Googles CEO said on their earnings call that
(22:11):
thirty percent of the code that's submitted now is maybe
more than thirty percent created by AI, So it's really
across the board. And I think that, you know, young
people need to just figure out how to be how
to learn creativity, critical thinking, independence, originality.
Speaker 3 (22:29):
I mean, all.
Speaker 5 (22:29):
These extremely human skills are going to become more in
demand because rote memorization basic math, like all that stuff is,
we got it handled by the machines.
Speaker 3 (22:44):
It's not just coding either.
Speaker 4 (22:46):
There was a big study this week from the UN,
from their International Labor Organization kind of looking at the
impact AI would have on jobs, and they looked at
thirty thousand different occupations and they found that overall, in
wealthy countries, about one in three jobs would be impacted distressingly.
Way more jobs that are traditionally considered female jobs would
(23:07):
be what they called transformed. That'd be like clerical jobs, assistants,
things like that.
Speaker 3 (23:12):
But it's huge.
Speaker 2 (23:13):
Can I just say as much as like part of
me wants to believe this, and I want to believe that,
like being an art history major is like a great
career choice. And I was comp lit and you know
I should say, like the the computer engineering major seven
point five percent unemployment computer science.
Speaker 3 (23:30):
Wait, seven point five percent unemployment.
Speaker 2 (23:32):
It's point one double more than double both more than
double art history. But you know what, there are other
things going on here, and I am somewhat skeptical of
this narrative, to be honest, and I'll tell you why.
Number One, these companies are all very, very motivated to
be pushing this idea. So like Microsoft has invested tens
of billions of dollars, its entire business is essentially predicated
(23:57):
on this working. If this didn't work, if you weren't
able to replace large numbers of computer scientists like that
is gonna be a big problem for Microsoft. The second
thing is all of these tech companies hired huge numbers
of engineers and computer scientists, often overpaying, during the pandemic
(24:17):
and immediately afterward there was this war for talent. And
I don't think we know for sure whether these layoffs
are actually layoffs that are related to AI, or are
they layoffs that are related because these companies like basically
stapped up too much.
Speaker 5 (24:33):
Well, they definitely stapped up too much, and that calling
started around twenty twenty three that you know, Mark Zuckerberg's
Year of Efficiency, a bunch of other companies did. They
sort of broke the seal in terms of tech layoffs. Previously,
it was considered like a really bad sign if your
company was laying people off, and these tech jobs were
(24:53):
considered like the most stable careers you could have. But
what I'm hearing from everyone who who's working in tech
right now, even big tech, is that you don't get
tenure anymore. You have to actually be working, you have
to be submitting code, you have to be doing things
that have an impact. And I think that that's a
(25:14):
reaction to this sort of complacency that developed from just
the growing forever idea and all of the big tech
companies across the board if you look at their products,
I mean, their legacy products are getting to the point
where they're not going to fuel the next ten years
the way they fueled the last twenty. Right Google Search,
(25:36):
Facebook's Instagram and WhatsApp, Amazon's marketplace, Microsoft's products. How much
bigger can those things get?
Speaker 2 (25:44):
Right?
Speaker 5 (25:44):
And so there has to be a lighting of a
fire under all of these companies to push them to
the next era, whatever that may be. And look at Apple,
like what's coming after the iPhone? They have no idea,
they don't have a solution yet. So these tech workers
who used to kind of have a famously cushy lifestyle
are being put to work in a way that they
(26:05):
are not used to.
Speaker 4 (26:06):
I mean, I find it really interesting what Max was
saying about the CEOs kind of scaring everybody or sort
of using the you know, the robots are coming the
robots are coming be very afraid to maybe scare workers,
Like who should be scared? What jobs do you see
AI really threatening versus.
Speaker 3 (26:24):
Maybe not as much as we thought.
Speaker 5 (26:26):
I mean you kind of think about the secretarial jobs
when nobody really knew how to type except for secretaries.
Right soon, everyone's going to know how to use AI
in ways that are integrated with their jobs. And you know,
there's no career that's not going to be using that
a little bit. It's just going to become so infused
(26:50):
with our every day the way the internet is, so
whether people will become totally unemployed, I mean long hauled
truck drivers that's going away. Customer service I think is
going away, is it?
Speaker 7 (27:03):
Though?
Speaker 2 (27:04):
I don't think that's clear. Self drive trucks, trucking is
going to be. That's gonna be one of the hardest ones.
Speaker 5 (27:10):
I know, you're a self driving.
Speaker 2 (27:12):
Skeptic, show me, show me a computer driving a truck,
and I'll believe you. Max.
Speaker 5 (27:17):
I live in the city of Waimo, and I see
I see Waimo become ubiquitous here in San Francisco.
Speaker 2 (27:25):
The thing about trucking that is hard is that they
drive really fast and and like if it crashes, it
kills people. I really think it's important to have humility here, Like.
Speaker 5 (27:35):
Max, here's what I know is going to happen. People
are going to overdo it before they correct. Right, Say
you're you're outsourcing editing of research papers or something, and
you decide, oh, we don't need any copy editors anymore,
we'll just use AI. And then you realize that the
AI mess things up. That'll happen afterwards. Right, there's going
to be like a mass embrace before there's a backlash
(27:58):
and people figure out the balance like a pendulum swinging
right and finally get to a point where we understand
what works and what doesn't work. And what's happening right
now is we're getting to this point in the industry
where we're kind of realizing this pace that we've had
for the past couple of years of like, Okay, the
better model comes out, and the better model comes out,
(28:19):
and the better and the more specific model comes out.
I think if we just like stop and take stock
of what has already been built and then figure out
how to apply it, that's kind of the next step, right,
And you're seeing companies invest in that open AI, hiring
people like Fijismo. That's because they need to just take
what they've already done and put it to work, figure
(28:42):
out what is useful about it.
Speaker 2 (28:44):
And Sarah just you're saying that people are going to
overdo it at some point, which I think is like
one hundred percent of great prediction. It's even happening now.
This this thing that Stacy brought up at the top
of the show where a bunch of major newspapers printed
a whole page of book recommendations books by famous authors.
The thing was, ten of the fifteen books were just
(29:07):
entirely made up. And this went in the like I
know that, you know, newspapers are maybe not as big
as they used to be, but it went in the
printed newspaper like some you know, old lady in like
Philadelphia is hearing about an Isabelle Ion date book that
does not exist, wondering dreams and wondering why you can't
find tidewater dreams.
Speaker 5 (29:26):
Yeah, I mean AI is built upon an approximation of
everything that it's that has happened in the past, right,
So it's a remixer of knowledge from so many different sources,
and sometimes that's gonna come out looking funky and that's
what I'm talking about critical thinking, Like you have to
check this work.
Speaker 2 (29:46):
You can't.
Speaker 5 (29:46):
It looks so so perfect that you know, you just
just trust it.
Speaker 2 (29:53):
This is why you need your long haul trucker, because
somebody's got to check that work.
Speaker 5 (29:57):
Yeah, someone's got to check that work.
Speaker 3 (29:59):
And you're history majors and your art history.
Speaker 5 (30:03):
Try making up an idiom in asking Google what it means.
It'll just make up an answer if you ask it,
Like for recipes using gasoline, it'll tell you about how
to use gasoline to make spaghetti. It's it's just like
early days in the world of AI in its application,
which is why, Like you can see how transformational it's
(30:26):
going to be, but you also have to understand that
you're dealing with something that still needs to be trained
and can't fully replace a human.
Speaker 4 (30:42):
So Max, we are now to the part of the
show where we talk about.
Speaker 3 (30:46):
Our underrated story of the week. This is story we
think did not get enough attention.
Speaker 2 (30:52):
Yeah, and you've got one for us today.
Speaker 4 (30:55):
Not only is this an underrated story of the week,
I think this is the underrated story of like the century.
Speaker 3 (31:00):
So get this.
Speaker 4 (31:01):
Scientists at Europe's large had drawn collider they successfully transformed
lead into gold.
Speaker 2 (31:09):
Stacey, are you saying that the thousand year old dream? Yeah, Alc,
I don't think it's the story of the century. Could
be the story of the millennium. We're probably talking about
a large quantity of lead turning into a large quantity
of gold.
Speaker 3 (31:22):
This is something you could say, Okay, that's semantics.
Speaker 4 (31:25):
I think what we need to look at is that
this is a quest that humankind has been on since
like three thousand Beasty Egyptians were looking into this building
blocks of matter, transforming matter. It's been linked to eternal life,
it's been linked to balancing the universe. I mean Isaac
Newton was into this.
Speaker 6 (31:42):
This is like on the level into this fountain of youth,
basically one hundred percent thousands of years.
Speaker 2 (31:48):
And some dorks in Switzerland did this.
Speaker 4 (31:51):
Yere say, they figured it out. They figured it out.
They turned lead into gold. Wow, eighty nine thousand atoms
is apparently microscopic.
Speaker 3 (32:00):
It only was gold for like a couple of millisones.
Speaker 2 (32:03):
So wait, what did they do? They just like shot
it through the collider or whatever, shot it through the tube,
and it like somewhere along the way, it just it transformed.
Speaker 4 (32:12):
That's actually pretty close from what I understand, which is
granted not a lot. So they had this big particle
accelerator that smashes atoms together at really high speeds, and
they found a way to kind of knock these particles
together out of lead atoms and the like briefly turn
them into gold.
Speaker 2 (32:28):
Now, this is obviously very cool, but like, do you
have any sense of like what we're gonna do with this,
like turning a little piece of lead into a little
piece of gold and then having it turned.
Speaker 3 (32:38):
Back in other word, like kind of why do we care?
Speaker 2 (32:40):
Yeah, well, just there must be some sort of use, right.
They must have been doing this for a reason besides
just the Here's.
Speaker 4 (32:46):
Why I think this is the business story that I
think it is.
Speaker 3 (32:49):
The gold market Max. The gold market.
Speaker 4 (32:51):
Gold has been hitting record highs because in this topsy
turvy world of inflation of crypto node even knows what
money is, people still trust gold. Gold is probably one
of the oldest stores of value in the world. For centuries,
people have been putting value into gold.
Speaker 2 (33:10):
Are you telling me I need to short the gold
market right now? This is not investment advice, by the way.
Speaker 4 (33:16):
I mean short the gold market no, this is the
last anchor that we have to anything real involving money,
Like what happens to us when that goes away? When
you can just when just a bunch of people in
Switzerland with a particle accelerator can just crank out gold
thirty nine thousand atoms at a time.
Speaker 2 (33:35):
I didn't hear an answer to the question there, but
I do hope that's the.
Speaker 3 (33:38):
Physical sency market's disrupted forever.
Speaker 2 (33:41):
The physicists who listen to the show will write us
at everybody's at.
Speaker 6 (33:44):
And they're gonna what we're gonna do with the twenty
picogram piece of material that is briefly gold, But that's
really cool.
Speaker 2 (33:59):
The show is produced by Stacy Wong. Magnus Hendrickson is
our supervising producer, Blake Maples handles engineering, Amy Keen is
our editor, and Brendan Francis Newdam is our executive producer.
Sage Bauman heads Bloomberg Podcast Special thanks to Jeff Muscus, Annamasarakis,
Robert Smith, and Aaron Casper. If you have a minute,
(34:19):
please rate and review the show. It means a lot
to us. And if you have a story or an
idea or something that should be our business email us
at Everybody's at Bloomberg dot net. That's everybody with an
AS at Bloomberg dot net. Thank you for listening, and
we'll see you next week.
Bloomberg Audio Studios, podcasts, radio news.
Speaker 2 (00:10):
This is Everybody's business.
Speaker 3 (00:11):
I'm Max Chapkins and I'm Stacey Vnnix Smith. Hey, Stacy, Hello, Max,
how are you.
Speaker 2 (00:16):
I'm good.
Speaker 4 (00:18):
I've just been thinking that all the world is a
stage and the economy is no exception. We have got
this week the congressional theater around the tax cut extension,
the big beautiful bill.
Speaker 2 (00:32):
Yeah, they've got a lot packed into this bill, tax
cuts that are gonna potentially save people a lot of money,
but also trillions of dollars that could be added to
our country's debt.
Speaker 4 (00:43):
But why think about that, Max, when you could think
about WrestleMania.
Speaker 2 (00:48):
Oh wow.
Speaker 4 (00:51):
We have got economic writer Kylo Scanlon on to talk
about how much you can learn about Trump's approach to
the economy by watching WWE.
Speaker 2 (00:59):
And I've read this everywhere. AI is coming for your job, abraded.
We're going to actually try to get into what that means.
Speaker 4 (01:06):
And we have a little actual magic in our underrated
story of the week.
Speaker 2 (01:11):
So, Stacy, this is the week many college graduations happen.
We have four million college students graduating in the United States.
Many of those folks, of course going to be getting
their first jobs really soon, they hope their parents hope.
Speaker 4 (01:25):
Yes, exactly, and this is a strange, possibly difficult time
to be coming onto the job market. A lot of
people economists are calling this a frozen job market, meaning
unemployment is near historic lows, but hiring levels are too.
Speaker 2 (01:38):
You know, look at the unemployment level for college graduates.
It's you know, it's almost six percent, which is low,
but it's not it's not that low.
Speaker 3 (01:45):
Yeah, it's always a little higher for recent college graduate.
It's a little bit of a tougher.
Speaker 2 (01:49):
Game, Stacy. This of course is a part of the
show where we go out into the world talk to
some people, ask them how the world of business, the
economy is affecting them. Where did you go this week?
I wanted to.
Speaker 4 (02:02):
Talk to these recent college grads, see what was going on,
how many of them had jobs, how they were feeling
about the job market. We're pretty close to Columbia University.
Their graduation was this week and I went to the
campus congratulations to the twenty twenty five class of Columbia Journalism.
(02:23):
Everyone was running around and graduation robes. They were taking
pictures with their parents. They were like holding big bouquets
and hugging each other.
Speaker 3 (02:30):
It was really sweet.
Speaker 2 (02:31):
They're all hungover also, by the way.
Speaker 4 (02:33):
I did not think about that, but possibly I went
to ask them, like, how do you feel venturing out
into the job market and what is going on?
Speaker 3 (02:40):
I'm a graduate student in computer science. Do you have
a job?
Speaker 2 (02:44):
Oh? Yeah, I do.
Speaker 3 (02:45):
I got like cape to.
Speaker 4 (02:46):
Be honest among your friends, like how many have jobs?
How many are still looking?
Speaker 2 (02:50):
In computer science?
Speaker 3 (02:51):
Approximately sixty to seventy percent have jobs.
Speaker 5 (02:54):
I studied epudymiology.
Speaker 3 (02:56):
Do you have a job right now?
Speaker 2 (02:57):
No?
Speaker 3 (02:58):
I did not. How's the job market fell extremely hard?
Speaker 1 (03:01):
I was mainly aiming for labs in different universities, but
universities are cutting phones.
Speaker 3 (03:08):
How's your job market for electrical engineering?
Speaker 6 (03:10):
Just terrible?
Speaker 2 (03:11):
The market is super terrible right now. Everyone will search.
Speaker 3 (03:14):
AI affect your field at all.
Speaker 5 (03:16):
AI is a tricky subject because it really does help
a lot, and in other ways it's detrimental to a
lot of job security. It's kind of fifty to fifty.
Speaker 4 (03:28):
I use AIA every day, fly the way, So you're
using AI to code?
Speaker 2 (03:32):
Yeah, almost every day. Actually a lot of people are
doing these days. I just want to know how many
his kids are using chat GPT to write their essays,
because you know that guy's like I use it to code.
I don't know.
Speaker 3 (03:45):
Well, you know, he was a software engineer. He has
a job.
Speaker 4 (03:48):
But I was pretty shocked that like thirty forty percent
of software engineering grads did not have jobs that he
talked to when a lot of people were really pessimistic.
A lot of people did not want to talk to
me about this.
Speaker 2 (04:00):
You know, I feel like it's always like this for
college graduates, or maybe this is just my adulthood or whatever,
but like, you know, the economy's changing. You're coming in
there with a limited network. I mean, even even these
Columbia students, who of course have a huge leg up
from a normal person. But yeah, I mean it's it's scary,
but you know, I'm excited for them.
Speaker 3 (04:20):
I'm excited for them too. Of course, we wish them well.
Speaker 2 (04:23):
We're gonna hopefully later in the show put some data
to this question of job loss, really get to specifics,
but we definitely want to hear what you all think.
How big an impact is technology having on the job market,
Like are you using AI in your job? Do you
think AI can replace you? Do you like me think
it's a total bunch of bs and like, oh my god, whatever, Like,
(04:46):
let us know, Stacey, we had so many good emails
this week.
Speaker 3 (04:49):
Yes, we did.
Speaker 4 (04:50):
We had great emails this week, and we're going to
be talking about them in future shows.
Speaker 3 (04:54):
But please keep the emails coming. We want to know
what you want to hear about.
Speaker 2 (04:57):
Yeah, that address, everybody's at Bloomberg dot that's everybody's with
an s at Bloomberg dot net. Just real quick, Stacy,
I got to tell you we had a couple requests
in in terms of future episodes about insurance. Do you
believe that? So?
Speaker 3 (05:09):
Alex a listener insurance is fascinating, wants to.
Speaker 2 (05:12):
Know why insurance is getting so expensive, why car insurance
is getting so expensive? Will wants to hear about the
kind of voting rights control at Berkshire Hathaway. Marita asked
about the bond markets. I know we'll hit that, and
a listener named josh gave us a note that I'd say,
is are bordering on NC seventeen rated that I'm not
(05:33):
going to give, but without business, we do appreciate it. Joshua.
Speaker 4 (05:37):
Yeah, apparently glazing does not mean what we think it means.
Speaker 2 (05:45):
The big story this week is this tax bill. The
House worked hard to pass a version of the bill,
the Big Beautiful Bill, just before the long weekend. It's
an extension essentially of the twenty seventeen tax cuts that
Trump put in place during his administration and that we're
said to expire.
Speaker 4 (06:02):
Yeah, the amounts of money that we're talking about are huge.
We're talking around four trillion dollars over the next ten years.
And to put that in perspective, our entire budget, what
it costs to run the entire country, is about seven
trillion dollars a year. So it's just the amounts of
money aren't enormous and even potentially quite destabilizing. Obviously, it's
(06:24):
going to add to our debt, which is already pretty substantial.
Speaker 2 (06:27):
Yeah, this is confusing, particularly because we were talking in
this country just a couple of weeks ago about all
the cuts we're making, and now all of a sudden,
there's a huge deficit. There are some cuts in the bill,
cuts to medicaid, food aid, clean energy. It's a lot
of really important stuff, stuff that people care about.
Speaker 4 (06:46):
The problem I think with a lot of these issues
is that it gets a little bit dry and boring.
I hate to say that, because it is really important,
but it's a little bit boring tax policy. When you're
talking about pass throughs, tax brackets, state and local policy,
it's a lot less exciting to talk about.
Speaker 2 (07:01):
Than doge or than professional wrestling.
Speaker 4 (07:04):
Everything's less exciting to talk about them professional wrestling. And
according to Kyla Scanlon, author of In This Economy and
ECON blogger Extraordinaire, WrestleMania has taken over the US economy
and the tax cut is the perfect example of what
is going on.
Speaker 3 (07:21):
She joins us, Now, Hi, Kyla, Hey, how's it good? Good?
Thanks for talking with us. So, Kyla, you talk in.
Speaker 4 (07:28):
One of your latest sub stacks and videos that you
made about this economic policy aligning with something called k
fabe in wrestling.
Speaker 3 (07:37):
What is k fabe and how does this apply to taxes?
Speaker 2 (07:42):
Yeah?
Speaker 1 (07:43):
So, k fabe is staged reality. So if you ever
watched WrestleMania or anything like that, the wrestlers have these
personas that they take on and they act out these
really elaborate like wrestle moves, pile drivers, things like that,
and they even act like that off the wrestle matt
and it's just this idea that the whole reality is
(08:04):
fake more or less, but it looks incredibly real. The
world of wrestling by Roland Bars was the big inspiration
behind that piece, and he sort of talks about.
Speaker 3 (08:13):
Roland Bars like the philosopher linguist.
Speaker 1 (08:16):
Yeah, so he wrote this incredible piece that talks all
about how you know, wrestling and this sense of justice
and the sense of morality, and like, in order to
really have a narrative, like you have to have these
good guys and these bad guys, and you have to
have k fabe. And so the analogy comparing WrestleMania essentially
to the US government, where we have a lot of posturing,
(08:37):
big chair slams on people's heads, Like a lot of
it seems staged in order to make some sort of point,
specifically with regards to tariffs. But the tax bill could
definitely be k fabe too. And so I think that
the current administration just because of the background of Trump
in WWE, in reality TV, like the guy is an
attention merchant, right, He's really good at it, and I
(09:00):
think it's carrying over.
Speaker 2 (09:01):
Speaking of that, we got to play this clip for
people who haven't heard it.
Speaker 3 (09:04):
Oh my god, So I was looking around.
Speaker 4 (09:06):
I vaguely remembered I used to watch wrestling back in
the day, and I remembered vaguely that Trump had been on.
But of course, with the magic of the Internet, I
looked it up, and I have to say I was
like a little bit mind blown. We have a clip
of Donald Trump. Basically it's part of the something called
the Battle of the Billionaires, but it was a wrestling
match where Trump was in it.
Speaker 1 (09:30):
Often.
Speaker 2 (09:31):
So Trump is like walking around.
Speaker 4 (09:32):
The ring, yeah, and he's like on the edge of
the ring, and then he jumps in and starts beating
up this this other man, this other fighter, Vince McMahon.
Speaker 2 (09:41):
Yeah, he's beating up Vince McMahon, who was the CEO
of WWE also, by the way, the husband of the
current sectarification. Yeah.
Speaker 3 (09:51):
I mean, it's it's it's wild.
Speaker 4 (09:55):
I mean, one thing that that is coming into my mind,
especially around the tax us, is all of the theater
with Doge and the government cuts. And I read that
all of the cuts that have been made by Elon
Musk and Doge amount to just a fraction, a tiny,
tiny fraction of one percent of the budget. Meanwhile, the
tax bill, which has had some drama around it, but
(10:17):
way less than Doge. We've just talked about it, way less.
You know, the implications economically are enormous. I mean that
also seems like it kind of falls under this k
fabe philosophy.
Speaker 1 (10:32):
Yeah, I mean I think there's an element of that.
Like Doge was very public, Like they had their own
Twitter account, They had those guys on the front lines
doing interviews all over the place. Elon Musk was in
charge of Doze, even though I think he says he isn't,
and so they were very you know, intentionally in the
public eye, which is probably why they got more pressed
in media.
Speaker 2 (10:51):
I like the analogy for Doge too, because you know,
Silicon Valley, you guys both probably know this, but like
Silicon Valley is super into k fabe as a term.
I spent spent a lot of time when I was
writing my book listening to Peter Teele and Teal talks
about kfab all the time. I feel like with Doge,
they were in costumes and the crazy thing to me, though,
is it worked right. There were like budget experts saying like, hey,
(11:14):
these guys are never going to get anywhere near two
trillion dollars Nonetheless, you had like Jamie Diamond and people
I think who are very smart and very sophisticated, essentially saying, oh,
this is great, like basically talking as if we'd entered
this era of austerity. Meanwhile, over here in the middle
of the night, they're planning this tax cut that's going
to add a huge amount of money to the federal budgets,
(11:36):
doing the exact opposite thing that if you were watching
the show that was on TV, that was the story
you were being told.
Speaker 1 (11:43):
I think that that distraction is the ultimate tool. And
I know I sound like a little bit of a
conspiracy theorist story when I talk about this stuff, but
I think hidden in this tax bill is a bunch
of stuff that can really hurt a lot of people,
especially in terms of healthcare access and in terms of
just affordability. And so I think for the government, like
having this sort of dramatic sparring, you know, Trump tweeted
(12:07):
or truth whatever about you know, the government selling Freddie
May and Fannie mack on, you know, the morning of
this beautiful, big tax bill getting passed. And so I
think there's always some element of distraction that comes up
when they want to have stuff slide under the rug
A bit kyla.
Speaker 2 (12:24):
I'm wondering. During the last Trump administration, the Republicans did
this thing where they drastically dialed back the deductions for
people who live in high tax states, and in certain ways, right,
that was like a understandable, sort of sensible move if
you were going to cut taxes, and now it appears
like they're poised to raise it huge amount. That seems
(12:46):
like a big part of the problem here.
Speaker 1 (12:49):
Yeah, I mean, the bill gives out a lot of
tax cuts and doesn't really think through how to pay
for them. A lot of the ideas that like, you know,
maybe turiffs will cover some of those costs, or the
cuts to Medicaid and Medicare will cover some of those costs.
I think it's a pretty short term look at that,
(13:09):
because like, sure, you can cut costs in the meantime,
but the repercussions down the road could be massively expensive.
They're also increasing taxes on like Carverard and maybeat'll cover it,
but it's incredibly expensive and it's incredibly short sighted because
the last thing that we need is more tax cuts.
Speaker 2 (13:26):
So Trump has tried to raise taxes on rich people
a few times or sort of floated it, and he
just always gets smushed basically by the Republican establishment and
big donors and stuff. I almost feel like it's because
the k fabe stuff like doesn't work on private equity managers.
Like you can't just like k fave your way into
like cutting carried interests because there are very very rich
(13:47):
people who really really don't want that to.
Speaker 3 (13:49):
Happen, and they're going to fight back. You can't really
hit them with a chair. They can afford a bigger chair.
Speaker 4 (13:54):
So just to do a little bit of counterprogramming, Kylo,
where should we be looking? Like, what should we be
focused on? With all of these performances happening? Where should
we look?
Speaker 1 (14:05):
I mean, I think the ar border of truth right now,
in my opinion, is the bond market. And so I
think that if you want sort of a story about
how the world is thinking about the United States, like
looking at the bond market is pretty useful because it
doesn't mess around, right like it's going to usually tell
some element of the truth. The bond market is not
(14:26):
happy about this.
Speaker 3 (14:26):
Big beautiful bill because of the debt.
Speaker 1 (14:28):
Yeah, Moody's downgraded the US. I think that that's pretty
useful sort of using that as a gauge.
Speaker 3 (14:35):
What signals should we be on the lookout for with
the bond market.
Speaker 1 (14:39):
Yeah, so if people are looking at the situation in
the US government and they're like, oh my gosh, I
don't know for the thirty year bond, for example, I'm
not sure how the US government's going to look in
the next thirty years. You're gonna have to pay me
so much money in order for me to buy these bonds.
Fields are going up. That's a good way to gauge
how the market is thinking about the long term viability
of the US government and how they're looking at that outlook.
Speaker 4 (15:02):
Yeah, it's kind of like if I'm in a lot
a lot of debt and go to the bank and
they might give me a loan, but they're going to
charge me a really high interest rate for it because
they're going to look at me as a really risky
person to lend money to.
Speaker 1 (15:11):
Yeah, and right now, the youth government is seeming increasingly
risky to people, especially investors.
Speaker 2 (15:18):
You hinted at this, Kyla, but like a lot of
this stuff may not survive the Senate bill. Is your
assumption that the Republicans will figure out a way to
get this passed, adding a huge amount to the debt,
or is there some chance that there are lots of
different forces pushing against this, one of which is the
bomb market that we may you know, be talking in
(15:39):
two months or three months and this thing hasn't really
gone anywhere, or they're still fighting over this or something. Yeah.
Speaker 1 (15:45):
What's sort of funny is everybody thinks they're big and
in charge until the bond market comes knocking.
Speaker 2 (15:49):
It's James Carvill, right, I want to come back as
the bomb market when I die, because everybody, everybody's afraid
of you.
Speaker 1 (15:55):
Yes, And I think it's really simple to like past
these big things and be like it's going to pay
for itself and we're going to replace income taxes the tariffs,
which is just not mathematically possible. But I absolutely think
that the bond market will let its thoughts be known
and the US government, the Treasury specifically, is going to
have to do things to appease the bond market in
(16:16):
the meantime, things that they didn't want to do that
they don't want to do, and it could get complicated
really fast if they keep on being irresponsible.
Speaker 4 (16:24):
The biggest wrestler of all the bond market. Kyla Scanlon
is the author of In This Economy. You can check
her out on substack, TikTok Instagram. She makes content every
day talks about all kinds of aspects of the economy.
Speaker 3 (16:39):
There's definitely a lot to learn.
Speaker 4 (16:41):
And it's always really fun, really unique takes much like
WrestleMania as an explanation for our economy.
Speaker 2 (16:53):
Stacey, we heard at the top of the show that
the graduates of today, the young people who will lead
us in the future, concerned about artificial intelligence. They're worried
about what it means for their jobs. And you know,
it has gotten me thinking, like, how much is this
actually happening right now? I mean, and we've seen a
(17:13):
lot of this. There's BusinessWeek has a great issue out,
the AI Issue. There's some interesting stuff in there on this.
There's also just an amazing overview of what's happening in
the market. To kind of break this down, I wanted
to bring in Sarah Fryar, who's Bloomberg's big tech editor.
She's following all of these big companies and these big investments,
(17:34):
and I think also just brings a lot of good
perspective here.
Speaker 7 (17:36):
Hey, Sarah, hi Sarah, Hi, thanks for having me so, Sarah,
there's a new genre in social media that I've been noticing,
a kind of a new form of bro atry, which
is the poetry.
Speaker 2 (17:49):
That executives right on LinkedIn, and that is the memo
warning your employees about AI. Toby Lucky of shopify I
wrote one essentially saying that everyone had to use AI
and you weren't going to be allowed to hire unless
you show that AI couldn't do it first. Mikah Kaufman
(18:10):
of Fiver wrote, AI is coming for your job. I'm
not talking about your job at five or talking aboute
that to his employees, your ability to stay in your profession.
He not only wrote it to his employees, he posted
it publicly. Sarah, can you just give us a sense?
Is this basically like conventional wisdom among the kind of
like tech CEO class that basically like, hey, we just
(18:33):
need to buckle up. The AI is going to like
replace half my staff or something. You know.
Speaker 5 (18:38):
I think it's for real that it's changing a lot
of the workforce. And I think the sentiment from the
shopif I ceo. He got really slammed on the internet
for that, for telling employees he wasn't going to give
them headcount unless he could prove that AI couldn't do
that job. That's pretty widespread right now in tech companies,
and I think that it's more of a forcing factors
(19:01):
to get their employees to fully embrace the new technology
and understand what they can do with it. Now, there
are downsides. There are obvious downsides. If you have so
much work done by AI, it gets things wrong.
Speaker 4 (19:15):
Yeah, there was just that booklist this week where like
a bunch of newspapers published like the fifteen Great Summer Reads,
and it had been generated by AI, and ten of
them weren't real books.
Speaker 2 (19:25):
There are so many examples like this, so many cautionary tails.
The one that Stacy mentioned though very bad.
Speaker 5 (19:32):
Then you have companies like Microsoft who do major rounds
of layoffs, and we looked at the numbers and Bloomberg
found that the majority of those positions the hardest hit
were software engineers. So those people graduating from college that
you noted who are worried about the workforce, of course,
they're worried because they grew up in this era of
(19:53):
everyone of our generation telling them to learn to code.
You know, they all grew up learning that STEM was
everything and that you had to be a quantitative person
in order to succeed in the modern world. Now that
may have been true ten years ago, but now there
(20:15):
are fewer entry level software jobs because so much of
entry level software can be done with AI. It's not
replacing the senior jobs, and in fact, a lot of
the code still has to be checked by someone who
actually knows what they're doing. It's going to make it
easier for someone who's an experienced developer to develop faster,
But for those entry level jobs, for those people who
(20:37):
are going to come in and learn the basics and
be put to work before before growing up, it's going
to be harder for that.
Speaker 2 (20:44):
I got to say. The New York Federal Reserve Bank
recently published a list of undergraduate majors with the highest
and lowest unemployment rates, and as English major, I have
never felt so smug in my entire life because for
decades I have been hearing this learned the code thing.
And let me tell you art history majors. Art history
(21:07):
that's like even more like irrelevant from that point of
view than you know, like.
Speaker 3 (21:13):
I mean objection, but continue I do.
Speaker 2 (21:16):
Like when somebody when somebody from the shape Rotator class
tries to make fun of us word cells. They always
pick on art history majors and unemployment rate for art
history majors three percent unemployment rate.
Speaker 5 (21:31):
Right, if you're putting your kid through college now or
through high school now, you know, forget about those coding hamps.
Teach some critical thinking, like so much about Yeah.
Speaker 2 (21:41):
You gotta know the difference between a doric column and
an ionic column or you will not get by in
this world.
Speaker 5 (21:48):
I love STEM. I think that that stuff is really
you know, engineering is really important, but you need to
be able to look at what the AI produces and
correct it. I mean that's like a key skill, and
you need to be able to use the AI in
a way that is productive. And we're seeing it's not
just Microsoft. Googles CEO said on their earnings call that
(22:11):
thirty percent of the code that's submitted now is maybe
more than thirty percent created by AI, So it's really
across the board. And I think that, you know, young
people need to just figure out how to be how
to learn creativity, critical thinking, independence, originality.
Speaker 3 (22:29):
I mean, all.
Speaker 5 (22:29):
These extremely human skills are going to become more in
demand because rote memorization basic math, like all that stuff is,
we got it handled by the machines.
Speaker 3 (22:44):
It's not just coding either.
Speaker 4 (22:46):
There was a big study this week from the UN,
from their International Labor Organization kind of looking at the
impact AI would have on jobs, and they looked at
thirty thousand different occupations and they found that overall, in
wealthy countries, about one in three jobs would be impacted distressingly.
Way more jobs that are traditionally considered female jobs would
(23:07):
be what they called transformed. That'd be like clerical jobs, assistants,
things like that.
Speaker 3 (23:12):
But it's huge.
Speaker 2 (23:13):
Can I just say as much as like part of
me wants to believe this, and I want to believe that,
like being an art history major is like a great
career choice. And I was comp lit and you know
I should say, like the the computer engineering major seven
point five percent unemployment computer science.
Speaker 3 (23:30):
Wait, seven point five percent unemployment.
Speaker 2 (23:32):
It's point one double more than double both more than
double art history. But you know what, there are other
things going on here, and I am somewhat skeptical of
this narrative, to be honest, and I'll tell you why.
Number One, these companies are all very, very motivated to
be pushing this idea. So like Microsoft has invested tens
of billions of dollars, its entire business is essentially predicated
(23:57):
on this working. If this didn't work, if you weren't
able to replace large numbers of computer scientists like that
is gonna be a big problem for Microsoft. The second
thing is all of these tech companies hired huge numbers
of engineers and computer scientists, often overpaying, during the pandemic
(24:17):
and immediately afterward there was this war for talent. And
I don't think we know for sure whether these layoffs
are actually layoffs that are related to AI, or are
they layoffs that are related because these companies like basically
stapped up too much.
Speaker 5 (24:33):
Well, they definitely stapped up too much, and that calling
started around twenty twenty three that you know, Mark Zuckerberg's
Year of Efficiency, a bunch of other companies did. They
sort of broke the seal in terms of tech layoffs. Previously,
it was considered like a really bad sign if your
company was laying people off, and these tech jobs were
(24:53):
considered like the most stable careers you could have. But
what I'm hearing from everyone who who's working in tech
right now, even big tech, is that you don't get
tenure anymore. You have to actually be working, you have
to be submitting code, you have to be doing things
that have an impact. And I think that that's a
(25:14):
reaction to this sort of complacency that developed from just
the growing forever idea and all of the big tech
companies across the board if you look at their products,
I mean, their legacy products are getting to the point
where they're not going to fuel the next ten years
the way they fueled the last twenty. Right Google Search,
(25:36):
Facebook's Instagram and WhatsApp, Amazon's marketplace, Microsoft's products. How much
bigger can those things get?
Speaker 2 (25:44):
Right?
Speaker 5 (25:44):
And so there has to be a lighting of a
fire under all of these companies to push them to
the next era, whatever that may be. And look at Apple,
like what's coming after the iPhone? They have no idea,
they don't have a solution yet. So these tech workers
who used to kind of have a famously cushy lifestyle
are being put to work in a way that they
(26:05):
are not used to.
Speaker 4 (26:06):
I mean, I find it really interesting what Max was
saying about the CEOs kind of scaring everybody or sort
of using the you know, the robots are coming the
robots are coming be very afraid to maybe scare workers,
Like who should be scared? What jobs do you see
AI really threatening versus.
Speaker 3 (26:24):
Maybe not as much as we thought.
Speaker 5 (26:26):
I mean you kind of think about the secretarial jobs
when nobody really knew how to type except for secretaries.
Right soon, everyone's going to know how to use AI
in ways that are integrated with their jobs. And you know,
there's no career that's not going to be using that
a little bit. It's just going to become so infused
(26:50):
with our every day the way the internet is, so
whether people will become totally unemployed, I mean long hauled
truck drivers that's going away. Customer service I think is
going away, is it?
Speaker 7 (27:03):
Though?
Speaker 2 (27:04):
I don't think that's clear. Self drive trucks, trucking is
going to be. That's gonna be one of the hardest ones.
Speaker 5 (27:10):
I know, you're a self driving.
Speaker 2 (27:12):
Skeptic, show me, show me a computer driving a truck,
and I'll believe you. Max.
Speaker 5 (27:17):
I live in the city of Waimo, and I see
I see Waimo become ubiquitous here in San Francisco.
Speaker 2 (27:25):
The thing about trucking that is hard is that they
drive really fast and and like if it crashes, it
kills people. I really think it's important to have humility here, Like.
Speaker 5 (27:35):
Max, here's what I know is going to happen. People
are going to overdo it before they correct. Right, Say
you're you're outsourcing editing of research papers or something, and
you decide, oh, we don't need any copy editors anymore,
we'll just use AI. And then you realize that the
AI mess things up. That'll happen afterwards. Right, there's going
to be like a mass embrace before there's a backlash
(27:58):
and people figure out the balance like a pendulum swinging
right and finally get to a point where we understand
what works and what doesn't work. And what's happening right
now is we're getting to this point in the industry
where we're kind of realizing this pace that we've had
for the past couple of years of like, Okay, the
better model comes out, and the better model comes out,
(28:19):
and the better and the more specific model comes out.
I think if we just like stop and take stock
of what has already been built and then figure out
how to apply it, that's kind of the next step, right,
And you're seeing companies invest in that open AI, hiring
people like Fijismo. That's because they need to just take
what they've already done and put it to work, figure
(28:42):
out what is useful about it.
Speaker 2 (28:44):
And Sarah just you're saying that people are going to
overdo it at some point, which I think is like
one hundred percent of great prediction. It's even happening now.
This this thing that Stacy brought up at the top
of the show where a bunch of major newspapers printed
a whole page of book recommendations books by famous authors.
The thing was, ten of the fifteen books were just
(29:07):
entirely made up. And this went in the like I
know that, you know, newspapers are maybe not as big
as they used to be, but it went in the
printed newspaper like some you know, old lady in like
Philadelphia is hearing about an Isabelle Ion date book that
does not exist, wondering dreams and wondering why you can't
find tidewater dreams.
Speaker 5 (29:26):
Yeah, I mean AI is built upon an approximation of
everything that it's that has happened in the past, right,
So it's a remixer of knowledge from so many different sources,
and sometimes that's gonna come out looking funky and that's
what I'm talking about critical thinking, Like you have to
check this work.
Speaker 2 (29:46):
You can't.
Speaker 5 (29:46):
It looks so so perfect that you know, you just
just trust it.
Speaker 2 (29:53):
This is why you need your long haul trucker, because
somebody's got to check that work.
Speaker 5 (29:57):
Yeah, someone's got to check that work.
Speaker 3 (29:59):
And you're history majors and your art history.
Speaker 5 (30:03):
Try making up an idiom in asking Google what it means.
It'll just make up an answer if you ask it,
Like for recipes using gasoline, it'll tell you about how
to use gasoline to make spaghetti. It's it's just like
early days in the world of AI in its application,
which is why, Like you can see how transformational it's
(30:26):
going to be, but you also have to understand that
you're dealing with something that still needs to be trained
and can't fully replace a human.
Speaker 4 (30:42):
So Max, we are now to the part of the
show where we talk about.
Speaker 3 (30:46):
Our underrated story of the week. This is story we
think did not get enough attention.
Speaker 2 (30:52):
Yeah, and you've got one for us today.
Speaker 4 (30:55):
Not only is this an underrated story of the week,
I think this is the underrated story of like the century.
Speaker 3 (31:00):
So get this.
Speaker 4 (31:01):
Scientists at Europe's large had drawn collider they successfully transformed
lead into gold.
Speaker 2 (31:09):
Stacey, are you saying that the thousand year old dream? Yeah, Alc,
I don't think it's the story of the century. Could
be the story of the millennium. We're probably talking about
a large quantity of lead turning into a large quantity
of gold.
Speaker 3 (31:22):
This is something you could say, Okay, that's semantics.
Speaker 4 (31:25):
I think what we need to look at is that
this is a quest that humankind has been on since
like three thousand Beasty Egyptians were looking into this building
blocks of matter, transforming matter. It's been linked to eternal life,
it's been linked to balancing the universe. I mean Isaac
Newton was into this.
Speaker 6 (31:42):
This is like on the level into this fountain of youth,
basically one hundred percent thousands of years.
Speaker 2 (31:48):
And some dorks in Switzerland did this.
Speaker 4 (31:51):
Yere say, they figured it out. They figured it out.
They turned lead into gold. Wow, eighty nine thousand atoms
is apparently microscopic.
Speaker 3 (32:00):
It only was gold for like a couple of millisones.
Speaker 2 (32:03):
So wait, what did they do? They just like shot
it through the collider or whatever, shot it through the tube,
and it like somewhere along the way, it just it transformed.
Speaker 4 (32:12):
That's actually pretty close from what I understand, which is
granted not a lot. So they had this big particle
accelerator that smashes atoms together at really high speeds, and
they found a way to kind of knock these particles
together out of lead atoms and the like briefly turn
them into gold.
Speaker 2 (32:28):
Now, this is obviously very cool, but like, do you
have any sense of like what we're gonna do with this,
like turning a little piece of lead into a little
piece of gold and then having it turned.
Speaker 3 (32:38):
Back in other word, like kind of why do we care?
Speaker 2 (32:40):
Yeah, well, just there must be some sort of use, right.
They must have been doing this for a reason besides
just the Here's.
Speaker 4 (32:46):
Why I think this is the business story that I
think it is.
Speaker 3 (32:49):
The gold market Max. The gold market.
Speaker 4 (32:51):
Gold has been hitting record highs because in this topsy
turvy world of inflation of crypto node even knows what
money is, people still trust gold. Gold is probably one
of the oldest stores of value in the world. For centuries,
people have been putting value into gold.
Speaker 2 (33:10):
Are you telling me I need to short the gold
market right now? This is not investment advice, by the way.
Speaker 4 (33:16):
I mean short the gold market no, this is the
last anchor that we have to anything real involving money,
Like what happens to us when that goes away? When
you can just when just a bunch of people in
Switzerland with a particle accelerator can just crank out gold
thirty nine thousand atoms at a time.
Speaker 2 (33:35):
I didn't hear an answer to the question there, but
I do hope that's the.
Speaker 3 (33:38):
Physical sency market's disrupted forever.
Speaker 2 (33:41):
The physicists who listen to the show will write us
at everybody's at.
Speaker 6 (33:44):
And they're gonna what we're gonna do with the twenty
picogram piece of material that is briefly gold, But that's
really cool.
Speaker 2 (33:59):
The show is produced by Stacy Wong. Magnus Hendrickson is
our supervising producer, Blake Maples handles engineering, Amy Keen is
our editor, and Brendan Francis Newdam is our executive producer.
Sage Bauman heads Bloomberg Podcast Special thanks to Jeff Muscus, Annamasarakis,
Robert Smith, and Aaron Casper. If you have a minute,
(34:19):
please rate and review the show. It means a lot
to us. And if you have a story or an
idea or something that should be our business email us
at Everybody's at Bloomberg dot net. That's everybody with an
AS at Bloomberg dot net. Thank you for listening, and
we'll see you next week.
Host
David Papadopoulos
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