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  • Market Growth in the First Half of 2025.

    According to S&P Global, the U.S. market cap rose by 4.7% in the past 6th months. This represents a modest gain compared to the average market capitalization growth of 12.2% during the same period.

    Leaders in growth were South Korea, Spain, Germany, Italy, and Brazil.

     

    Voronoi21 via VisualCapitalist

    We have previously discussed this, but in addition to investments in technology and artificial intelligence, global capital is also being directed toward emerging markets, where many businesses are being established.

    At first glance, some may see U.S. underperformance, but it can also be read as a sign of relative maturity and stability. Another potential perspective is that U.S. companies have already experienced explosive growth in recent years, particularly in sectors such as tech and AI, suggesting the market may currently be in a phase of consolidation.

    While it's always great to see explosive growth, people undervalue resilience and steady growth, especially in light of the volatile first quarter of the year. 

    Time will tell! 

     

  • Diminishing Returns in AI: The Most Common AI Mistake

    At some point, more of the same stops paying off … it is called the law of diminishing returns.

    Law of Diminishing Returnsvia Sketchplanations

    Nature (and common sense) reminds us that equilibrium is important. For example, when you exercise too much, you get injured; when you drink too much water, you get poisoned; etc. 

    This concept applies almost everywhere.

    • It's why diversification is so important in portfolio construction theory. 
    • Or, why you don't want to put all your eggs in one basket (concentrating your risk).
    • And, my favorite, it's also why you shouldn't only eat vegetables.

    A related nugget of wisdom from the extreme … Too much of a good thing is a bad thing! 

    And of course … Be moderate in everything, including moderation.

    A recent study on the effects of ChatGPT use on brain activity also supports this theme. 

    via "Your Brain on ChatGPT: Accumulation of Cognitive Debt when Using an AI Assistant for Essay Writing Task" 

    The study divided 54 subjects into three groups, and asked them to write several SAT essays using ChatGPT, Google, or nothing at all. They used an EEG to record the writers' brain activity. ChatGPT users showed the lowest brain engagement. Over time, ChatGPT users got lazier. 
    As a result, the ChatGPT essays also ended up lacking original thought and sounding similar. 
     
    The paper suggests that the use of LLMs could harm learning and retention. The group that wrote without any help showed the highest neural connectivity, and higher brain activation in creativity ideation, memory load, and semantic processing. This group was more engaged and curious, and expressed higher satisfaction with their work. 
     
    The paper hasn't been peer-reviewed yet and has a small sample size. 
    Ultimately, I think it's telling us something we probably could have already guessed. If you're not actually the one reading or writing something … you're not going to absorb the information as well. Your brain isn't going to activate as well. And if you're not finding other places to train your brain, you'll get worse at critical thinking. 
     
    A few weeks ago, I wrote about my research process and how AI has both bolstered and hindered certain aspects of it. I'm casting a wider net, but going less deep. 
    So now, I’m exploring how to maintain a balance. I still want to leverage AI’s value, while reintroducing a layer of slowness and reflection into the process. Maybe that means manually summarizing some articles. Maybe it means pausing to journal about what I’ve read, or discussing it with someone. The goal is not to abandon the efficiency — but to ensure that efficiency doesn’t come at the cost of depth. - via "Is AI Making Your And Your Team Smarter?"
    This isn't a call to avoid AI or to slow down its development. It's a call to deliberation and intentionality. Students are flaunting that they're using ChatGPT to shirk the system. Companies are releasing AI-written copy not only on their websites but also in press releases. Humans are falling in love with chatbots and leaving their spouses. 
     
    Meanwhile, AI is also the underpinning of countless enhancements and increased productivity. 
     
    The same thing happened with the Internet. 
     
    At a certain point, overreliance becomes a crutch, not a tool. 
     
    I bet AI makes unintelligent and lazy people lazier and less intelligent. 
    I'm positive it can make YOU smarter and more effective if you use it in moderation and to support your unique abilities. 
    Onwards! 

  • My Artificial Intelligence Journey

    Time seems to go faster as I get older. Likewise, technology seems to be advancing faster than ever, too.

    Take AI as an example… even though I've been involved in this field for many years, I'm surprised by how rapidly it's improving now.

    I suspect that part of the surprise comes from comparing the current pace of change to my memories of how long it took to improve in the past. Even though I had a sense of the quickening, the thing about exponential technologies is that there's a tipping point … and clearly we're past that point on the curve.

    I'm often met with surprise when I talk about my AI journey … because it began in 1991, when it was still hard to spell AI.

    Looking back, it makes a lot more sense to me than it did as I was moving through it. Here is a video about that journey and what it means for you and your future. 

     

    Click here to view the transcript of the video.

    Looking back on my life and career, one could argue that I got my start in AI with my most recent company, Capitalogix, which was founded over 20 years ago. Or, perhaps, we could go back further and say it started with my previous company, IntellAgent Control (which was an early AI company, focused on the creation and use of intelligent agents). By today's standards, the technology we used back then was too simple to be considered AI, but at the time, we were on the cutting edge.

    Maybe we should go further back and say it started when I became the first lawyer in my firm to use a computer … or was it when I first fell in love with technology? 

    The truth is … I've spent my whole life on this path. My fascination with making better decisions, taking smarter actions, and getting better results probably started when I was two years old (because of the incident discussed in the video).

    Ultimately, the starting point is irrelevant. Looking back, it seems inevitable. The decisions I made, the people I met, and my experiences … they all led me here.

    However, at any point in the journey, if you asked, "Is this where you thought you'd end up?" I doubt that I'd have said yes. 

    I've always been fascinated by what makes people successful and how to become more efficient and effective. In a sense, that's what AI does. It's a capability amplifier. 

    When I transitioned from being a corporate securities lawyer to an entrepreneur, Artificial Intelligence happened to be the best vehicle I found to do that. It made sense then, and it makes sense now.

    Like most things in life, it's easy to see the golden thread looking backwards, but it's a lot harder to see projecting forwards.

    I wouldn't have it any other way. It certainly keeps things interesting.

    Onwards!

  • Major Asset Class Performance Since 2020

    Last week, we highlighted the growth of cryptocurrencies. This week, we're taking a look at the performance of various asset classes during the previous 5 years – including Bitcoin. 

    To start, let's get a sense of where things stand year-to-date.

    This has been a "strange" year. As someone who follows Markets, I'm still surprised by how many times I'm tempted to say that.

    In addition, I'm also surprised by how well global assets have fared year-to-date.

    Here's a high-level overview.

    Gmi.tab_.01may2025 (Asset Class Returns)
    via CapitalSpectator.

    After a seemingly significant string of losses, U.S. stocks experienced a surprising rebound in May, marking their first monthly gain since January. This upturn propelled U.S. equities to the top of the performance leaderboard among major asset classes during the month. The rally was driven by broad strength across global markets, though some segments, particularly bonds in developed markets, faced declines.

    Equities and bonds typically have an inverse relationship. Recently, both markets have been reacting sharply — stocks up, bonds down. This dynamic reflects uncertainty. The market is balancing hope and fear simultaneously — hope in economic recovery and corporate earnings, and fear of tighter monetary policy.

    Game theory suggests that the conflicting incentives between growth-focused and risk-averse investors create a dynamic equilibrium sustaining this paradox. However, this brings up an uncomfortable question for investors:

     
    What if the erosion of bonds’ safe haven triggers a systemic liquidity crisis when protection is most needed?

     

    That is where a longer-term lens is particularly helpful, both for providing context and offering insights into portfolio mix and diversification strategies.

    The infographic illustrates how major asset classes performed each year over five years, highlighting the impact of external shocks and policy changes. It emphasizes the importance of diversification by showing how different assets respond uniquely to economic shifts, enabling investors to identify risks and opportunities in recent market cycles.

     

    via Visual Capitalist.

    Bitcoin has performed better than I expected during the past five years, attracting both institutional and retail investors. Meanwhile, gold has seen renewed interest as falling interest rates and easing political uncertainty have led some investors to seek safer assets, reflecting a shift toward lower risk tolerance in segments of the market.

    It's interesting to see the dichotomy between these two asset classes and their growth, despite their almost inverse profiles. 

    Meanwhile, 2025 has been a rocky year for many asset classes. If you like potentially meaningful (but likely meaningless) factoids, 2025 has seen the S&P 500's fifth-worst start to a year in history. 

    It will be interesting to see how the rest of this year plays out. 

  • Is Crypto Going Mainstream in 2025?

    Humans are good at recognizing significant changes on the horizon, but not nearly as good at understanding the second and third-order consequences of those changes.

    A great example is the Internet. As it spread, most adults understood that it would bring “big changes”. However, even as a tech entrepreneur at the time, I didn’t fully grasp what the rise of the Internet would cause or make possible.

    I feel the same way today about the rise of AI. It literally will change everything.

    Close behind that is what’s happening in Crypto.  

     

    Where Attention Goes, Money Flows

    I don’t claim to be a crypto expert or fan. Historically, I’ve been skeptical and resistant on many levels. Nevertheless, I've always argued the blockchain was here to stay. Now, even Crypto seems to be becoming an inevitability.

    Governments are becoming supporters. Regulators are falling in line. Big banks and industry are building infrastructure. New giants are forming. Coinbase recently joined the S&P 500. Circle just had a wildly successful IPO. And the performance of stocks like these hints at the growing market appetite for crypto businesses.

    Currently, Crypto’s market cap is over $3 trillion. At the beginning of Trump’s presidency, the cryptocurrency markets experienced a significant surge. Since Donald Trump’s re-election in November 2024, Bitcoin has surged 60 percent, reaching record highs. However, Bitcoin isn’t the only cryptocurrency experiencing a surge; even meme coins are seeing a massive increase in value. 

    Nevada recently hosted a Bitcoin conference, featuring speakers such as Vice President JD Vance, Trump’s two eldest sons, Donald Trump Jr. and Eric Trump, as well as White House crypto advisor David Sacks. 

    Despite the growth (and Trump’s support), there are still mainstream obstacles … obstacles that may be addressed by increased investment in stablecoins. For context, countries such as the UAE and Vietnam boast higher rates of cryptocurrency ownership than the United States. 

     

    Stablecoins Are Rising

    A stablecoin is a type of cryptocurrency designed to maintain a stable value, typically pegged to a reference asset like a fiat currency (e.g., U.S. dollar) or a commodity (e.g., gold). This contrasts with other cryptocurrencies, such as Bitcoin, which can experience significant price fluctuations. They serve many purposes, but ultimately believe they’re an interesting way to store value on-chain and take steps into the crypto world. 

    The stablecoin market in 2025 is dominated by a handful of major platforms and issuers, recognized for their scale, transparency, and integration into both traditional finance and decentralized finance (DeFi) ecosystems. The two largest and most respected stablecoin platforms are Tether and Circle.
     
        Tether (USDT)
    •Market Position: Tether remains the largest stablecoin by market capitalization, with over $140 billion in circulation and controlling more than 60% of the stablecoin market.
    •Key Features: USDT is widely used across centralized exchanges, DeFi protocols, and global payment networks. It is primarily backed by U.S. Treasury bills and managed by Cantor Fitzgerald, providing a reserve base comparable to that of major national treasuries.
     
        Circle (USDC)
    •Market Position: USDC is the second-largest stablecoin, with a market cap exceeding $60 billion.
    •Key Features: Known for its transparency, Circle publishes weekly attestations of reserves, which are held in cash and short-term U.S. government treasuries.
     
    Stablecoin funding is projected to 10X.

     

    CBInsightCryptoCBInsights via Voronoi

    When cryptocurrency started to gain popularity, I expressed concerns about how banks and governments would resist widespread adoption until they could introduce regulation and gain control over it. I remember confidently saying that, throughout history, governments have always protected the right to print and tax coin. That is still true … it just means something different to me, now, than it did when I said it.

    I’m starting to pay more attention to Crypto, blockchain, and other emerging DeFi technologies.

    I’m seeing an increasing flow of talent, opportunities, and resources to this space.

    For example, major payment players like Mastercard and Visa are allowing stablecoin transactions and even creating their own coins. 

    I do believe growth in stablecoins will also result in growth in other forms of cryptocurrency as well. 

    For context, here are the best-performing cryptocurrencies of 2024. 

     

    Chart showing the top performing cryptocurrencies as of Nov 2024

    via VisualCapitalist

    I still won’t pretend to be knowledgeable about the various coins, but I recognize that they are becoming more common and useful as speculation markets. 

    All in all, I believe we are witnessing the birth of another blue ocean, and we can expect increased attention and investment to continue.

    Onwards! 

  • Is AI Making You And Your Team Smarter?

    At the core of Capitalogix’s existence is a commitment to systemization and automation. 

    At first, the goal was to eliminate fear, greed, and discretionary mistakes from trading.

    Over time, we’ve worked hard at making countless things easier. Much like math, we found that the best practice is to simplify complex processes before trying to automate them.

    I’m surprised by how many times I have had the same realization … Less is more.

    Likewise, I’ve learned the hard way that a great strategy is useless if people don’t get it. That is part of the reason that frameworks are so important.

    Ultimately, the process, the system, and the automation should follow this basic recipe if you want it to succeed:  Simple, Repeatable, Consistent, and Scalable.

    Finding ways to automate sounds great. Increasing efficiency, effectiveness, and certainty sounds great, too  … but, routines and habits become ruts and limits when they become un-measured, un-managed, or forgotten. 

    A practical reality of increasing automation and constant progress is that it becomes increasingly important to have expiration dates on decisions, systems, components, and automations. We need to shine a light on things to make sure they still make sense or to determine whether we have a better option.

    Freeing humans to create the most value sounds great, too … but, as the pace of technological progress increases, the importance of freeing people to do more diminishes if they don’t actively rise to the occasion.

     

    My Use of Technology

    I got my first computer in 1984. It was the original Macintosh. That means I’ve been searching for and collecting technology tools to make business and life easier and better since the mid-80s.

    It has been a long and winding road. These days,  it seems like I’m constantly looking for new ways to use AI in my life.

    As you might guess, I “play” with a lot of tools. Of course, I think of it as research, discovery, and skill-building … rather than playing. Why? Because it is something I’m good at, it produces value – and it gives me energy … so, I make sure to reserve a place for it in my routine.

    While most of what I explore doesn’t make it into my “real work” routine, I now have a toolbox of dozens of tools that I use for everything from research, notetaking, brainstorming, writing, and even relaxing. 

    It’s a little embarrassing, but my most popular YouTube video is an explainer video on Dragon NaturallySpeaking from 13 years ago. It was (and still is) dictation software, but from a time before your phone gave you that capability. 

    As I focus on systemization, I also have to focus on optimization. 

    Using generative AI tools for daily research has fundamentally changed how I approach information gathering. What began as a meditative practice—slowly reading, digesting, and reflecting on material—has evolved into a faster, more expansive process. With AI, I can now scan and synthesize a much broader set of sources in far less time. The quality of the summaries and takeaways is high, enabling me to deliver more value to others. I can write better articles, share timely insights with fellow business owners, and keep my team well-informed. The impact on others has grown — but something subtle has shifted in my own learning.

    The tradeoff is that if I’m not as careful as I used to be while doing the research, and I don’t engage with the material in the same way I did before. When I did the research manually, I was “chewing and swallowing” each idea, pausing to make connections, reflecting on implications, and wrestling with the nuance. That process was slower, but it etched ideas more deeply into memory.

    As a result, my favorite articles of the week or month would show up in how I spoke on stage, what I wrote about, and how I worked through roadblocks with employees. Now, I notice that although I’m exposed to more information, it doesn’t have the same weight or impact. I’m consuming more at scale … but retaining less, or perhaps less deeply (at least in my head). In contrast, I store much more, both in terms of quantity and depth, in my second brain (meaning, the digital repositories available for search when needed).

    This brings up a fundamental distinction between knowledge storage and knowledge retrieval. Storage is about accumulating information, while retrieval is about quickly accessing and using the correct information at the right time. It requires digestion. 

    It’s kind of like Amazon. Amazon has made buying books and getting them on my shelves easier than ever. I’ve got 1000s of books with answers to many of life’s questions. But, I’d estimate that I’ve really only read around half of the books I currently have on my shelf. The point is that having a book on your shelf with the answer to a problem is not the same as having the answers. 

    I now have many thousands of articles in my Evernote. There are probably over a hundred of them about better “prompt engineering” or using “prompting techniques better”… but I can’t pretend that each article has made me better at those things. I have gotten better at thin-slicing and knowing what I want to store to improve the quality of the raw material I search for.

    So now, I’m exploring how to maintain a balance. I still want to leverage AI’s value, while reintroducing a layer of slowness and reflection into the process. Maybe that means manually summarizing some articles. Maybe it means pausing to journal about what I’ve read, or discussing it with someone. The goal is not to abandon the efficiency — but to ensure that efficiency doesn’t come at the cost of depth.

    The priority is making sure I’m optimizing on the right thing. It’s not progress if you’re taking steps in the wrong direction.

    Let me know what you think about that … or what you are doing that you think is worth sharing.

    Onwards!

  • Choosing To Be More Human in the Age of AI

    Last week, I asked, “What do you do when AI gets better than you?” One of the key takeaways from that post was that AI is freeing you up to be more human.

    My son (who helped write it) said he wished we used more examples and stories that dealt with “the future of being human” rather than “the future of work”. So, we decided that would be the “seed” idea for this post.

    It’s funny, but when I started to gather my thoughts about it … I felt a rush of emotions. 

    Emotions and Logic

    Emotions have frustratingly little to do with logic. Humans are driven by impulse and often by those that don’t represent our best nature. History shows that we’re driven by fear, greed, scarcity, and self-preservation. And, truthfully, that’s all “human”. But humans are also beautiful, meaning-making machines … and throughout our often messy history, we’ve done amazing things and somehow survived.

    Appreciating Life

    Watching my father die was a catalyst for me to appreciate life and living more than I did. I gave a TEDx talk about that and wrote articles about the time value of a life worth living. At the end of his life, it was clear that he appreciated things more (a family dinner, a kiss goodbye, the beauty of a sunset) and that he would have done almost anything for more time. Two hidden gifts came from that “scarcity”. The first gift was recognizing that we got to choose how much more “life” we got out of the last part of my dad’s life. The second gift was realizing that you don’t have to wait for the end of life to “live like you only have a year left”.  

    Final Goodbye

    I have another memory from his deathbed as well. He had been out of it for a while, and I was worried that I wouldn’t get a chance to say a final goodbye and to tell him how much I loved him. Luckily, he woke up, and we had a few final lucid moments together. He looked me straight in the eyes, told me how much he loved me, and then with a touch of humor said, “Okay, so tell me how this relates to Veritas …” which was the original name of the company I was running at that time. His final message to me was a reminder that life is not really about work.

    Looking Beyond Work

    Transparently, I still look at the world through a lens and filter that too often focuses on work. Yet I also recognize and strive to pay attention to the deeper meanings beyond that.

    Getting back to the point of the article, it is easy to see how AI relates to work … yet, it might be more important to consider how AI is going to affect the rest of your life. 

     

    Dc-Cover-652ovhkibhg82kh6on274ihkn1-20180128034206.Medi

     

    In the last article, we discussed how Lee Sedol, one of the world’s top Go players, retired after losing to AlphaGo. When asked about it, Lee said, “Losing to AI, in a sense, meant my entire world was collapsing.” He also explained, “I could no longer enjoy the game. So, I retired.” 

    While it’s certainly his right to retire, I think it might have been the wrong choice … or, at least, not what I would have done in that situation.

    If playing Go was his passion, it might have been better for him to change how he “keeps score” to focus on his progress, rather than the distance between him and what AI could do.

    As long as you believe you can get better (and have hope for continued improvements), there are many ways to leverage the capabilities and opportunities that come from that.

    Many people engage in sports or games even though they know they won’t become the greatest of all time. The same is true for almost any hobby or pursuit (whether it’s in art, literature, philosophy, craftsmanship, or other fields). There will always be someone or something that can do it better, faster, or more efficiently. However, that shouldn’t be the sole determinant of whether you get joy or energy from pursuing a path of getting better at what you want to excel at.

    One of my core beliefs is that the changes coming to the world will free us up to be more human. That means we have to choose what to pursue.

    What’s more human than pursuing something difficult? 

    The Beauty of Passion

    In a world increasingly shaped by AI’s precision and efficiency, choosing to do something purely out of passion becomes a powerful act of self-expression. When a machine can paint more photorealistically or compose music with perfect mathematical harmony, human creativity finds new purpose not in competing, but in conveying emotion, imperfection, and lived experience.

    The Heartbeat of AI is Still Human_GapingVoid

     

    As we focus on growing businesses and changing the world, I think it’s easy to lose sight of the passion that first got us into business. 

    I do the research and write this newsletter, not because I expect it to make me a ton of money, or because AI can’t do it … but because I enjoy it, and it’s almost like meditation for me. 

    My son plays rugby despite enduring countless injuries, significant financial cost, and realizing that it takes increasing amounts of his time to stay competitive. From a logical standpoint, it makes almost no sense for him to spend scarce resources or risk such extreme bodily harm in his 30s. But he’s passionate about rugby, enjoys playing it, and recognizes how it improves other parts of his life. It is an excellent example of the time value of a life worth living. He made a conscious choice that this is what it takes to be, do, and have what he values most.

    The Power of Fun 

    Artificial Intelligence is probably better than you at poker … does that mean you shouldn’t have some friends over and try to win their money?

    Does it mean you shouldn’t try to learn a new instrument or write a book?

    We often undervalue fun because it doesn’t always produce measurable outcomes, but fun is not frivolous. It’s how we bond, relax, and explore parts of ourselves we can’t access through obligation or structure.

    We intrinsically understand this. You don’t worry about being the best when you’re playing pick-up basketball or throwing a football with your son. You’re focused on creating memories and having fun. 

    Joy doesn’t need justification. 

     

    Striving To Be The Best

    Ultimately, you have to be willing to lose to be the best. In every pursuit, there will always be someone ahead of you. Whether it’s a faster runner, a sharper mind, or a newer technology, I want to be the man in the arena. 

    It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows the great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat. – Theodore Roosevelt, Citizenship in a Republic

    The point has never been to be the best at everything … but to strive for your best.

    I’ve always believed the game isn’t over until I win, not because I can’t lose, but because the belief empowers me to get back up again. 

    Being second best — or tenth, or just a beginner — doesn’t diminish your effort; it validates it. The climb matters, even if you never reach the summit. Humans are wired for persistence and purpose, not perfection. 

    Humanity got where we are today because people weren’t happy with the status quo. They pursued greatness and innovation. Sometimes, what seems like failure ends up being the most significant success. 

    AI is an incredible opportunity. It’s an opportunity to increase your productivity, to transform your business, and to redefine industries. It’s also an invitation to redefine your future and how you spend time. You can use it as an excuse to get smaller or bigger … the power is in your perspective.

    Hope that helps.

  • Are Your AI Fears Valid? What Experts Say

    It's no surprise that there is often a disparity between what experts believe and what the average adult feels. It's even more pronounced in industries like AI that have been lambasted by science fiction and popular media.

    Even just a few years ago, many of my advisors and friends told me to avoid using the term "AI" in our materials because they thought people would respond negatively to it. Back then, people expected AI to be artificial and clunky … yet, somehow, it also reminded them of dystopian stories about AI Overlords and Terminators. An incompetent superpower is scary … so is a competent superpower you can't trust!

    As AI integrates more heavily into our everyday lives, people's hopes and concerns are intensifying… but should they be? 

    Pew Research Center surveyed over 5,000 adults and 1,000 experts about their concerns related to AI. The infographic shows the difference in concern those groups had regarding specific issues.

     

    This graphic by Statista shows the biggest concerns of experts and regular adult users about AI.

    Statista via VisualCapitalist

    Half of experts (47%) report being more excited than concerned about AI’s future. Among U.S. adults, just 11% say the same.
    Instead, 51% of adults say they’re more concerned than excited — more than triple the rate of experts (15%).

     

    The most common—and well-founded—fears center on misinformation and the misappropriation of information. Experts and the average adult are in alignment here. 

    I am consistently surprised by the lack of media literacy and skepticism demonstrated by otherwise intelligent people. Images and articles that scream "fake" or "AI" to me are shared virally and used to not only take advantage of the most susceptible but also to create dangerous echo chambers. 

    Remember how bad phishing e-mails used to be, and how many of our elderly or disabled ended up giving money to a fake Prince from various random countries? Even my mother, an Ivy League-educated lawyer, couldn't help but click on some of these e-mails. Meanwhile, the quality of these attacks has risen exponentially.

    And we're seeing the same thing now with AI. Not only are people falling for images, videos, and audio, but you also have the potential for custom apps and AI avatars that are fully focused on exploitation. 

    AI Adoption Implications

    Experts and the average adult have a significant disparity in beliefs about the long-term ramifications of AI adoption, such as potential isolation or job displacement. 

    I'm curious, how concerned are you that AI will lead to fewer connections between people or job loss? 

    I often say that technology adoption has very little to do with technology and much more to do with human nature.

    That obviously includes AI adoption as well. 

    Career growth often means abandoning an old role to take on something new and better. It's about delegating, outsourcing, or automating tasks so you can free up time to work on things that matter more.

    It may sound like a joke, but I don't believe most people will lose jobs to AI. Instead, they'll lose jobs to people who use AI better. The future of work will be about amplifying human intelligence … making better decisions, and taking smarter actions. If your job is about doing those things – and you don't use AI to do them – you will fall behind, and there will be consequences.

    It's the same way that technology overtook farming. Technology didn't put people out of work, but it did force people to work differently.

    Innovation has always created opportunity and prosperity in the long term. Jobs may look different, and some roles may be phased out, but new jobs will take their place. Think of it as tasks being automated, not jobs. 

    Likewise, COVID is not why people have resisted returning to the office. COVID might have allowed them to work remotely in the first place, but their decision to resist going back to the office is a natural part of human nature.

    When people found that technology enabled them to meet expectations without a commute, opportunities and possibilities expanded.

    Some used the extra time to learn and grow, raising their expectations. Others used that time to rest or focus on other things. They're both choices, just with different consequences.

    Choosing to Contract or Expand in the Age of AI 

    AI presents us with a similar inflection point. I could have easily used AI to write this article much faster, and it certainly would have been easier in the short term. But what are the consequences of that choice?

    While outreach and engagement are important, the primary benefit of writing a piece like this, for me, is to take the time and to go through the exercise of thinking about these issues … what they mean, what they make possible, and how that impacts my sense of the future. That wouldn't happen if I didn't do it.  

    I often say, "First bring order to chaos … then wisdom comes from making finer distinctions." Doing work often entails embracing the chaos and making finer distinctions over time as you gain experience. With repetition, the quality of those results improves. As we increasingly rely on technology to do the work, to learn, and to grow, the technology learns and grows. If you fail to also learn and grow, it's not the technology's fault. It is a missed opportunity.

    The same is true for connection. AI can help you connect better with yourself and others… or it can be another excuse to avoid connection.

    You can now use an AI transcription service to record every word of an interaction, take notes, create a summary, and even highlight key insights. That sounds amazing! But far too many people become accustomed to the quality of that output and fail to think critically, make connections, or even read and process the information.

    It could be argued that our society already has a connection problem (or an isolation epidemic), regardless of AI. Whether you blame it on social media, remote work, or COVID-19, for a long time, how we connect (and what we consider "connection") has been changing. However, many still have fulfilling lives despite the technology … again, it's a choice. Do you use these vehicles to amplify your life, or are they a substitute and an excuse to justify failing to pursue connection in the real world?.

    As said, actions have consequences … and so do inactions.

    I'm curious to hear your thoughts on these issues. Are you focused on the promise or the perils of AI?

  • The “Chart Of The Century” In 2025: A Look At Consumer Price Inflation

    In an era of economic uncertainty, few visualizations have captured the attention of economists, policymakers, and everyday consumers like the “Chart of the Century” created and named by Mark Perry, an economics professor and AEI scholar. This chart tracks the dramatic shifts in consumer prices across various sectors of the American economy over a quarter-century, revealing patterns that challenge conventional wisdom about inflation, purchasing power, and economic well-being.

    The most current version reports price increases from 2000 through the end of 2024 for 14 categories of goods and services, along with the average wage and overall Consumer Price Index. Here are the key findings.

     

    • Wage growth has outpaced inflation by a significant margin (123.3% vs. 90%) from 2000 to 2024, resulting in a 16.1% increase in real purchasing power.
    • Sharp divergence exists between sectors: Technology and tradable goods have become much cheaper, while healthcare, education, and childcare costs soared.
    • Market competition and trade liberalization drive price decreases, while regulated markets and limited competition contribute to price increases.
    • Despite objective improvements in purchasing power, many consumers still feel financial pressure due to changing consumption patterns and “quality of life creep”.
    • Policy challenges remain in balancing regulation with market forces, particularly in essential services like healthcare and education.

     

    Core Economic Metrics: The Big Picture

    The foundation of this analysis rests on three critical metrics that provide context for all other price trends:
     
    Metric
    Change
    (2000-2024)
    Consumer Price Index (CPI)
    +90%
    Average Hourly Income
    +123.3%
    Real Purchasing Power
    +16.1%
     
    From January 2000 to now, the CPI for All Items has increased by almost 90%. That is a big jump from its 59.6% level in 2019, when I first shared this chart.
     
    These numbers tell a surprising story: despite widespread perceptions of economic hardship, Americans’ wages have grown significantly faster than inflation over these 24 years. This translates to a meaningful increase in real purchasing power – the ability to buy more goods and services with the same amount of work.
     
    However, this aggregate picture masks dramatic variations across different categories of goods and services. Let’s explore these divergent trends.
     
    The price of technology, electronics, and consumer goods — think toys and television sets — has tumbled over the past two decades. Why? These categories benefit from global competition, technological innovation, and manufacturing efficiencies.

    Meanwhile, the cost of hospital stays, childcare, and college tuition, to name a few, have surged. Why? These sectors share important characteristics: they are typically non-tradable services (cannot be imported), operate in markets with limited competition, and are often subject to extensive regulation.

    Below is Perry’s Chart of the Century. To help you interpret it better, lines above the overall inflation line have become functionally more expensive over time, and lines below the overall inflation line have become functionally less expensive. 

    A37b1cb8-f49a-47f3-959d-d76a34f3569e_1576x1291

    via Human Progress

    For context, at the beginning of 2020, food, beverages, and housing were in line with inflation. They’ve now skyrocketed above inflation, which helps to explain the unease many households are feeling right now. College tuition and hospital services also have continued to rise relative to inflation over the past few years.

     

    Market Dynamics: Understanding the Divergence

    What explains these dramatically different price trajectories? Here are several (but not all of the) key factors:

    Factors Driving Price Increases

    • Government regulation creating compliance costs and barriers to entry.
    • Quasi-monopolistic markets with limited price competition.
    • Non-tradeable services protected from foreign competition.
    • Limited technological disruption in certain service sectors.

    Factors Driving Price Decreases

    • Foreign competition putting downward pressure on prices.
    • Technological advancement reducing production costs.
    • Manufacturing optimization increasing efficiency.
    • Market competition forcing price discipline.
    • Trade liberalization expanding access to global markets.

    Looking at the prices that decrease the most, they’re all technologies. New technologies almost always become less expensive as we optimize manufacturing, components become cheaper, and competition increases. According to VisualCapitalist, at the turn of the century, a flat-screen TV would cost around 17% of the median income ($42,148). Since then, though, prices fell quickly. Today, a new TV typically costs less than 1% of the U.S. median income ($54,132).

    We should also consider the larger trends. For example, In 2020, I asked what Coronavirus would do to prices … and the answer turned out to be way less than expected. If you don’t look at the rise in inflation but instead the change in trajectories, very few categories were heavily affected. While hospital services have increased significantly since 2019, they were already rising. There were some immediate impacts, but they went away relatively quickly. 

    Another thing to consider is average hourly income. Since 2000, overall inflation has increased by 87.3%, while average hourly income has increased by 123.3%. This means that hourly income increased 38% faster than prices (which indicates a 16.1% decrease in overall time prices). You get 19.2% more today for the same amount of time worked ~24 years ago. This represents a mild increase in abundance since last year. 

    0196b2c1-1499-4df5-b6e3-e6882e971d68_1876x1458

    via Human Progress

    Although 10 of the 14 items rose in nominal prices over the past 24 years, only five had a higher time price when accounting for the 123.3 percent increase in hourly wages. Those items were medical care services, childcare and nursery school, college textbooks, college tuition and fees, and hospital services. 

    The Consumer Experience: Perception vs. Reality

    It’s interesting to look at data like that, knowing that the average household is feeling a “crunch” right now.

    My guess is that few consumers distinguish between perception and reality. However, feeling a crunch isn’t necessarily the same as being in a crunch.

    For instance, we must account for ‘quality of life creep,’ where people tend to splurge on luxuries as their standard of living improves. With the ease of online shopping and access to consumer credit, it has become increasingly easy to make impulse purchases, leading to reduced savings and feelings of financial scarcity. This phenomenon is a function of increased consumption (rather than inflation), yet it still leaves consumers feeling like they’re struggling to make ends meet. Our sense of what’s normal has risen, and that’s hard to unlearn. 
     
    Perry’s ‘Chart of the Century’ reveals the complex relationships between inflation, consumption, and economic growth. While households may feel financial strain, the data shows that income has outpaced inflation, and technology has made many goods more affordable. Nonetheless, there is still a real sense of economic struggle. Especially in these last few months. 
     
    Economic Patterns: Regulated vs. Free Markets

    A clear pattern emerges when examining the relationship between market structures and price trends.

    Regulated Markets (like healthcare and education) tend toward higher prices over time, feature less price competition, and offer limited consumer choice.

    Free Markets, show price decreases over time, feature greater competition, and provide consumers more options.

    This pattern raises important questions about the role of regulation in various economic sectors and the balance between consumer protection and market efficiency.

    With that in mind, how can policymakers address sectors experiencing significant price hikes, such as healthcare and education, without stifling innovation in tradable goods and services? 

    Future Outlook

    Beyond all that, here are three other key trends to watch.

    • AI Disruption: Telemedicine and online education could bend healthcare/education cost curves.
    • Trade Wars: New tariffs risk reversing tech price declines (e.g., proposed tariffs on Chinese electronics).
    • Generational Shifts: Millennials prioritize experiences over goods, potentially easing service demand.

    As we continue to innovate and policy changes, it will be interesting to see if we can make essential services as dynamically competitive as consumer electronics. While America is one of the best countries in the world in countless ways, we do lag behind several countries in healthcare and education.

    Onwards.

  • Here Are Some Links For Your Weekly Reading – April 20th, 2025

    Today's editorial cartoon

    Here are some of the posts that caught my eye recently. Hope you find something interesting.

    Lighter Links:

     
     

    Trading Links: