Source: Reuters Read full article
Tariff-related concerns were evident in responses to the question about government policy. Longer-term inflation expectations surged. The US manufacturing PMI from S&P Global showed slightly faster growth this month.
Mortgage rates have been moving lower. The median price was up 4.8% year-over-year. The Magnificent 7 stocks have been struggling as a group.
The Russell 2000 Small Caps has broken below its 200-day moving average.
US stocks are now lagging the rest of the world.
Economy:
Texas-area manufacturing activity dropped sharply this month amid growing tariff uncertainty. Manufacturers are reducing workers’ hours. US consumer spending remains robust despite weak sentiment and rising credit card and auto loan delinquencies, as the top 10% of earners—who account for half of all spending—still hold a significant $1.3T cushion of excess savings. Meanwhile, the other 90% have largely exhausted their pandemic-era savings, leading to financial stress and weaker sentiment. This disparity helps explain why overall spending stays strong even as lower-income households face growing financial strain.
However, the stock market is growing increasingly uneasy about discretionary consumer spending. Treasury yields have been declining amid increased uncertainty.
The median new home price was 3.7% above last year’s level. Inventories have been rising.
The Conference Board’s consumer sentiment indicator dropped this month, aligning with the report from the University of Michigan.
Source: Reuters Read full article
However, CEO confidence has been improving. Companies cut jobs at the fastest pace since the COVID shock amid tariff concerns.
The Fed:
Economists are no longer confident in two Fed rate cuts this year. Treasury yields continue to decline amid concerns over an economic slowdown.
The 10-year/3-month segment of the Treasury curve is inverted again.
The market is now pricing in 65 bps of Fed rate cuts this year, with June and September as the most likely timing.
2025 – The Year of the Robot
Last week, a robot dropped lunch at your doorstep. You tapped an app, ordered a burrito, and whoosh—a flying drone gently lowered your lunch into your front yard less than 10 minutes later.
Compare this to DoorDash, the Uber-like food delivery service. A human drives a 3,000 lb. car to lug a 1 lb. taco. A private limo for your lunch. Bonkers! Inefficient doesn’t begin to describe it.
Drones—or flying robots are a quirky novelty today. But soon, our cities will hum with delivery bots darting through the air. Our streets will purr with robotaxis gliding along, no steering wheel required.
After decades of sci-fi promises, robots are finally stepping out of the factory shadows and into our everyday lives… not as red-eyed Terminators bent on chaos, but as helpers. Startup Physical Intelligence recently showed off a robot that can fold laundry. The amazing thing is this bot learned by simply watching videos of humans folding clothes! Johns Hopkins University and Stanford researchers created a surgical robot that learned complex procedures simply by watching videos of human surgeons. Not only did it match human performance in delicate tasks like suturing. It also did them 30% faster. AI is giving robots real eyes that actually understand what they’re looking at. Real brains that can figure things out on the fly.
The mind-bending part is these new AI-powered robots can share what they learn with their droid friends. When one robot figures out a better way to do something, it can instantly teach every other robot in its network. Imagine thousands of surgical robots all learning from each other’s experiences, getting better with every operation.
The ChatGPT moment for robotics is here. While everyone is focused on when they’ll be able to order humanoid helpers around with a feather duster, real robots are already transforming our world. Meet the robotaxis, flying robots, and maker bots.
I had my first robotaxi experience in San Francisco last November. Magical is the only word for it.
It’s a surreal experience to see the steering wheel turn by itself. The strangest part was the silence. No awkward small talk about the weather or traffic… just the soft hum of Waymo’s electric engine and the distinct feeling that I had arrived in the future.
When I took a regular Uber to the airport later, it felt like trading in my iPhone for one of those old Nokia bricks. Self-driving cars have had so many false starts, I don’t think people realize just how good they’ve gotten in the past year.
Waymos are ferrying kids to soccer practice around San Francisco today. Waymo is already picking up more passengers than Lyft in San Francisco.
Tesla’s self-driving tech used to be like a student memorizing a massive rulebook. Yellow light, slow down. Spot a cyclist? Give them space. It memorized 300,000+ rules, which made the system brittle.
Tesla threw out the rulebook and replaced all that human code with an AI system. Instead of following rules, the car now makes decisions based on what it sees.
Tesla’s self-driving tech improved 100X in 2024, measured by how often humans needed to take over the wheel. Thanks to AI, we squeezed a decades’ worth of progress into one year!
The skeptics who claim self-driving cars are decades away are about to be humiliated.
Robotaxis will be the first widespread AI robots that change people’s lives. There’s something extremely exciting and inspiring about seeing a car drive itself.
If you live in or visit a city with robotaxis—Waymo in San Francisco, Austin, and Phoenix… Zoox in Las Vegas… Wayve in London… or Pony.ai in Shanghai—take a ride and experience the future for yourself.
Drones
If you missed it, we wrote about AI-powered drones reshaping war here. Amazon’s gearing up for 500 million drone deliveries by 2029. Zipline partnered with the Cleveland Clinic to parachute prescription meds to your doorstep. If you happen to be robbed in Santa Monica, a police drone will launch automatically, reaching crime scenes within three minutes.
From burritos to battlefields, pizza to penicillin, autonomous flying robots will infiltrate every aspect of our lives. Drones are the new phones and the single most underrated innovation today.
They’re also really cool. I saw pictures of 1,200 synchronized drones light up the night sky over the Bay Bridge, morphing into a gigantic, glowing Nike sneaker in midair. Flying robot light shows will replace fireworks at every major holiday within five years.
Amazon is America’s largest “robo employer,” with an army of 750,000 bots. Over three-quarters of its deliveries are handled by robots somewhere from warehouse to doorstep.
Step inside food giant Nestle’s factories, and you’ll find Boston Dynamics’ robodog strutting around inspecting pipes and gears.
Meanwhile, IKEA now employs 250+ autonomous drones in its humongous warehouses to count inventory and find out-of-place items. Spot the flying robot.
Every major technological leap—from the steam engine and cars to the internet—was met with panic, with cries of job losses and dystopian futures.
Louis’s post, Robots Have Been About to Take All the Jobs for 100 Years, is gold. It shows old newspaper clippings from every decade since the 1920s, swearing bots will gut us. In 1961, experts predicted most unskilled jobs would vanish within a decade. Sound familiar?
Yet today, despite more automation than ever in human history, we have more good jobs and more demand for labor than ever. It’s not a fluke. Every time, we end up wealthier, healthier, and happier.
As we approach the mass robot panic, know the bots aren’t out to get us. They’re here to crank abundance to 11.
Robots are here to handle the drudgery, freeing human creativity for higher pursuits.
Great Quotes
“If you can’t fly, then run. If you can’t run, then walk. If you can’t walk, then crawl. But whatever you do, you have to keep moving forward.”
– Martin Luther King Jr.
Picture of the Week
Mt Fuji, Japan
All content is the opinion of Brian Decker
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