Odd Lots

Tyler Cowen, an economics professor and co-author of the Marginal Revolution blog, explores why AI's impact remains subtle despite its capabilities. He discusses the resistance of legacy firms to adopt new technologies and highlights sectors like programming and finance already transformed by AI. Cowen delves into the cautious approach of law firms regarding data privacy and the medical field's rapid advancements. He examines AI's influence on creativity in music, public discourse, and education, advocating for a balanced curriculum that includes AI alongside essential life skills.

Saagar Enjeti, co-host of the Breaking Points podcast, dives into the impending political storm surrounding AI. He discusses how AI's impact on labor and electricity costs is gaining traction as a hot-button issue ahead of the 2026 and 2028 elections. Public distrust toward tech leaders is palpable as ordinary citizens voice concerns over job displacement. With local resistance to data centers, Enjeti points to historical parallels in industrial backlash. He also explores the shifting dynamics in Washington, suggesting big tech may soon find itself isolated.

Jeffrey Gundlach, founder and CEO of DoubleLine Capital and a renowned fixed-income investor, shares his candid views on the current financial landscape. He warns that almost all financial assets, including stocks, bonds, and private credit, are overvalued and susceptible to downturns. Gundlach stresses the importance of holding more cash and gold while advocating for a cautious approach to long-term Treasuries amid rising inflation. He also explores the risks of private credit's liquidity and volatility issues, highlighting how institutional behaviors may shift in response to fiscal stress.

Dirk Willer, Global Head of Macro Strategy at Citigroup and a macro research expert, discusses the current bubble in the stock market, pinpointing its onset in May and offering precise indicators for timing. He delves into the similarities between today's market and the dot-com bubble while explaining his unique approach to trading during bubbles. Willer also addresses gold's impressive rise and its connections to central bank actions and retail enthusiasm, alongside lessons from emerging markets that are increasingly relevant to U.S. dynamics.

In this discussion, Paul Kedrosky, a venture investor and tech cycle analyst, dives into the current AI landscape, likening it to a 'meta bubble' that combines elements from past bubbles like real estate and tech. He argues that the significant spending on AI, including massive data center investments, is unsustainable. Kedrosky explains intricate financial mechanisms like SPVs and highlights risks associated with GPU assets and securitization. With contrasting insights on US and China’s strategies, he prompts a reevaluation of AI's future profitability and potential macroeconomic impacts.

Cliff Asness, co-founder and CIO of AQR Capital Management, discusses his belief that markets have become less rational over the last decade. He explores the impact of social media and retail trading on market dynamics, highlighting how they contribute to inefficiencies. Asness reflects on the evolution of quantitative investing, the challenges posed by passive investing, and how AI is integrated into their processes. He also touches on the dual explanations for market behavior, blending risk-based and behavioral perspectives.

In this conversation, Jerry Neumann, a retired venture capitalist and Columbia Business School professor, challenges the notion that AI will lead to instant wealth for investors. He draws compelling parallels between AI and the historical containerization boom, warning that early adopters often miss out on real profits. Neumann discusses the importance of system-level innovations over individual tech, the evolving landscape of venture capital, and the potential for future winners in knowledge-intensive industries. His insights underscore the need for patience in navigating AI investments.

Mike Bird, Wall Street editor at The Economist and author of The Land Trap, dives into the intricate world of China's real estate. He reveals how housing has become a primary savings tool for many Chinese families and the role of land leasing in fueling urbanization. Bird discusses the challenges of affordability amid wealth creation, local governments' dependence on land sales, and efforts to cool the real estate market. He also critiques land-driven economic models and explores potential reforms.

Corey Geiger, lead dairy economist at CoBank, dives into the protein boom ignited by Fairlife milk, a brand that has reshaped the dairy market with its innovative processing. He discusses how Fairlife’s unique filtering process made it a top choice among consumers, even as traditional milk consumption declines. Geiger also addresses the influence of Coca-Cola's distribution on Fairlife's growth and shares insights on dairy pricing, farmer challenges, and the shifting preferences within fluid milk categories, helping us understand the future of the U.S. dairy landscape.

Conor Sen, a Bloomberg Opinion columnist specializing in labor market issues, dives into the confusing state of the U.S. job market. He discusses the lack of recent employment data due to a government shutdown and its implications for the Federal Reserve. Conor reveals how job growth is stalling outside of healthcare and examines the effects of AI on hiring trends. He also addresses the influences of reduced immigration, consumer spending shifts, and potential risks of rising unemployment, painting a complex picture of the economic landscape.