Lyn Alden

The Money Printer Is Back On with Lyn Alden

- AI Impact on Employment: AI is suppressing white-collar job creation and enabling automation, similar to how manufacturing automation affected blue-collar work in the 80s-90s. One person can now oversee work previously requiring five, but physical robotics adoption remains slow (Roomba example cited). - Software Stock Repricing: SaaS valuations face structural pressure due to AI competition and reduced switching costs. Companies built on recurring revenue models are being repriced downward; not obsolete, but less certain and thus warrant lower multiples (30x to 10-15x earnings). - Government-AI Relations: Anthropic rejected Pentagon contracts over two red lines: no mass surveillance of US citizens and no autonomous kill decisions. Pentagon shifted to OpenAI; geopolitical and ethical tensions around AI deployment are escalating. - Fiscal Deficit Trajectory: US debt will grind from ~$40 trillion to ~$50 trillion over five years. Pressures against deficit reduction are structural (aging population, defense spending, entitlements). Interest payments consume an increasing share of tax revenue. - Monetary Policy Shift: Central banks are transitioning from balance sheet reduction back to gradual expansion in line with nominal GDP growth. The Fed may use yield curve control as a last resort; softer methods (standing repo facilities, liquidity provision) are more likely near-term. - Money Supply & Inflation Distribution: Broad money supply growth (~7% annually, offset by ~3% productivity) produces inflation concentrated in scarce assets (Bitcoin, gold, real estate, waterfront property) rather than abundant goods (electronics, automatable services).