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President Donald Trump has pledged cheaper prices and lower interest rates, but an economy transformed by the pandemic will make those promises difficult to keep.Economic growth is solid, driven by healthy consumer spending. And budget deficits are huge and could get even larger. Meanwhile, businesses are borrowing more to step up their investments in data centers and artificial intelligence, leading to a greater demand for loans that can raise interest rates.And if Trump follows through on his promises to impose widespread tariffs on imports and deport millions of immigrants, economists expect inflation could worsenmaking it less likely the Federal Reserve will cut its key interest rate much this year.All of these trends will likely keep borrowing costs higher, including for homes and cars.Yet on Thursday during the World Economic Forum’s annual event in Davos, Switzerland, Trump said he would reduce oil prices, and then “I’ll demand that interest rates drop immediately, and likewise, they should be dropping all over the world.”Later, in Washington, Trump told reporters that lower energy costs would reduce inflation, which would “automatically bring the interest rates down.” Asked if he expects the Fed to listen to him on rates, Trump said: “Yeah.”Yet Trump may be facing a bigger challenge than he expects. The surprising resilience of the economywhich has weathered the aftermath of the pandemic, an inflation spike, and several recession scares just in the past few yearsmay keep borrowing costs higher.Jan Hatzius, chief economist at Goldman Sachs, says the economy is “in the sweet spot of healthy growth.”It has expanded at an annual rate of at least 3% for four out of the last five quarters, the longest such streak in a decade. Unemployment is at a historically low 4.1%. And inflation, which soared to a four-decade high in 2022 and soured most Americans on the economy, is back down to 2.4%, according to the Fed’s preferred measure.Wages, which badly trailed prices in 2021 and 2022, have risen faster than inflation for the past 18 months, which provides the needed fuel for ongoing growth.A healthier economy spurs more Americans to borrow to buy cars, homes, and large appliances, and businesses to invest in IT equipment and factories. Such moves are great for the economybut more demand for loans to fund all that spending can also keep interest rates elevated.And steadier growth could keep prices higher. Companies that see healthy consumer demand may decide they can charge more, as Netflix announced it would do Tuesday after signing up a surge of subscribers.Such trends are a big change from the last time Trump entered the White House in 2017. Back then, the U.S. economy was emerging from an extended period of sluggish growth and very low inflation that followed the painful 2008-2009 Great Recession. Millions of households saved more and spent less after a borrowing binge earlier in the decade that drove up mortgage and credit card debt.“Households were shrinking their balance sheets relative to their income, and that’s a very significant disinflationary force that is not present now,” said Julia Coronado, president of MacroPolicy Perspectives and a former Fed economist.Today, most households are carrying less debt and upper-income families in particular are benefitting from strong gains in home values and stock market wealth. About 40% of homes are now owned free and clearwithout a mortgage. Greater wealth can spur ongoing spending on travel, electronics, and dining out.In addition, high-tech firms are ramping up their investment in data centers to accelerate their work on artificial intelligence. Trump announced Tuesday a joint venture between OpenAI, Oracle, and Japan’s SoftBank to invest $500 billion in data centers and electricity generation to fuel AI research. Before the pandemic, many companies were stockpiling cash and weren’t investing as much, which can keep interest rates lower.“We are in a different world,” said Joe Brusuelas, chief economist at RSM, a tax advisory and consulting firm. “Gone is the era of low inflation and low interest rates. In its place is a new framework featuring scarce capital and higher rates.”As a result, Trump’s promises to stimulate the economy through tax cuts and deregulation, while also promising to impose tariffs and immigration restrictions, could keep prices elevated.“That’s going to be inflationary, and that’s going to push (Fed) policymakers to adopt more stringent policies than they would otherwise,” said Gregory Daco, chief economist at EY. “So you’re going to be in a higher interest-rate environment.”Even if the Fed does reduce its key rate in the coming months, that won’t necessarily reduce borrowing costs. Financial markets also affect the cost of borrowing for a home or car. Since the Fed began cutting its key rate in September, the yield on the 10-year Treasury notewhich strongly influences mortgage rateshas actually risen substantially.Gennadiy Goldberg, head of U.S. rates strategy at TD Securities, says investors are anticipating a continuation of stronger growth, in part fueled by Trump’s proposals to cut taxes and reduce regulation. In that scenario, the Fed would be less likely to cut its key rate.Many investors are discounting Trump’s tariff threats, hoping that he intends to use them as leverage in international talks, rather than permanently impose them.“I think there was an expectation that President Trump would bring all of the good policies and leave all of the bad policies for growth at the door,” Goldberg said.Another trend that Trump has helped spark is the rise of protectionist measures around the world, after two decades of globalization that lowered the prices for manufactured goods.“Instead of globalization driving prices lower, or at the very least putting a constraint on them, we’re now relocating supply chains and protectionist barriers are going up,” Brusuelas said. Nearly all economists forecast that will push prices higher, though the increase could be modest.Another shift is that stubbornly high yearly budget deficits threaten to lift interest rates as well, because Wall Street investors may require higher yields to buy all the Treasury securities needed to finance the debt.Last week, the nonpartisan Congressional Budget Office said this year’s deficit would likely reach $1.9 trillion, and grow to $2.7 trillion in a decade. Trump’s proposals to extend his 2017 tax cuts, and implement new ones, such as eliminating taxes on tips, would raise deficits further.“If we don’t get fiscal deficits down, we’re going to see higher longer-term bond yields,” said Fed governor Chris Waller earlier this month. “And that’s what we’re starting to see.” Christopher Rugaber, AP Economics Writer
Category:
E-Commerce
When I started my business nearly two decades ago, I shared the same reservations as many first-time entrepreneurs. As a natural introvert, I doubted whether I had the personality to lead a company. Fortunately, I pushed through those self-doubts and gradually discovered my leadership style. Today, however, many leaders face a new type of challenge: feeling like imposters in the age of AI. A recent Korn Ferry survey of 10,000 workers and executives found that AI contributed to 71% of CEOs and two-thirds of other senior leaders feeling imposter syndrome in their roles. With technology evolving at an ever-faster pace, the fear of falling behind is understandable. But it begs the question: Why are so many professionals adopting a wait-and-see approach to AI? In my experience, the best way to get started with AI is to carve out a bit of time for experimentation, explore new tools, and integrate them into daily workflows. As AI transforms industries, leaders cant afford to sit on the sidelines. If youre not already onboard, here are a few ways AI is helping CEOs run their companies more effectively. Transforming the decision-making process Being a CEO requires navigating an almost constant stream of decisions. While theres an argument for leaning on intuition, data is essential for wading through todays increasingly complex world. George C. Lee, co-head of the Goldman Sachs Global Institute, advocates leveraging AI in the C-suite to enhance effective decision-making. Writing for Fast Company, Lee explained that an AI-enabled system can analyze market trends, customer reviews, and competitive dynamics. He noted that such tools could broaden the context of any discussion, introduce novel insights, and connect the dots across complex scenario analyses. While some companies are developing proprietary AI models, widely available tools like ChatGPT are a great way to get started. They can conduct research and synthesize vast amounts of data in seconds, enabling CEOs to improve the quality of their decisions and make them faster and more confidently. Then, they can dedicate more time to big-picture topics like innovation. Theres a caveat: AI tools like ChatGPT are powerful tools, but they have the unfortunate habit of occasionally hallucinatingmaking things up. Its good practice to always verify essential information before relying on it for major decisions. Streamlining operations to focus on strategic growth As CEO of Jotform, Im always on the lookout for new automation opportunities. Integrating these tools requires an upfront time investment, but once the processes are in place, I regain that investment and more, leaving me wide swaths of time and energy to focus on strategic growth. According to an IBM survey of over 1,600 senior European executives, 82% of the business leaders reported having already deployed generative AI or intending to this year. A common motivation was the desire to improve efficiency by automating manual tasks. Leaders can use AI to automate routine tasks, such as tracking business metrics and trends. Tools like Microsoft Power BI provide centralized dashboards for real-time KPIs, while predictive analytics deliver trend updates and forecast outcomes, obviating the need to gather data manually. Or, take executive-level recruiting: CEOs can combine AI tools with personal insight to connect with talent faster. As Nancy Xu, Founder and CEO of Moonhub, said at Summer Davos this year: In a world where talent is traditionally the bottleneck for growth, I think the really exciting opportunity for AI agents is actually to compress the time scale that it takes to build ideas or companies to impact and make it possible to do that in a much more compressed time frame. As a result, CEOs can focus more on higher-level work, like ensuring their companies are continually evolving. Enhancing soft skills and boosting team morale Soft skills have long been underrated for CEOs, overshadowed by technical skills and business acumenbut that seems to be changing. According to Deloitte research, organizations are increasingly prioritizing soft skills in the C-Suite, like communication and critical thinking. CEOs can leverage AI tools to build and enhance these skills. For example, natural language processing tools, such as Grammarly or ChatGPT, can help leaders refine their communication style and messaging to be clearer, more personalized, and more empathetic. Sentiment analysis tools, like IBM Watson or Qualtrics, can analyze employee feedback or survey responses to take the temperature on team morale. That information in hand, CEOs can pinpoint areas where additional support might be needed and keep employee morale afloat. While AI will never replace leaders or human decision-makers, it can help them work faster, more efficiently, more effectivelyand at the same time, provide more guidance and support to employees. By experimenting with AI tools and integrating them into workflows, CEOs can navigate the increasingly complex modern business world and enhance, rather than eliminate, the human touch.
Category:
E-Commerce
Im someone who does a lot: Ive held multiple tech executive roles, founded and sold a startup, published an award-winning book, served on nonprofit boards, advised and invested in emerging companies, and kept a thriving creative life. Im also raising two kids with my husband. So its not surprising that Im often asked which productivity books I recommend. People are often surprised by my response: I dont read productivity books. Never havenever really wanted to. Why productivity books are BS I realized something recently, after going down a rabbit hole about productivity books from a heavily debated Threads post: the vast majority of best-selling productivity books are written by men91% of the top 100 titles, in fact. And most of these authors have mentioned having a wife at home, an arrangement that often implies shes handling much of the childcare and household management. That reality doesnt match my own. Like so many working women, I carry a substantial portion of the second shift at home: cooking, homework help, bedtime routines, and general emotional support. Research from the Gender Equity Policy Institute backs this up, showing that working women in the U.S. spend twice as many hours on childcare and housework as working men do. The big chunk of uninterrupted time that these authors count onwhether its a 5 a.m. stretch of sacred hours or a mini-sabbatical to reboot creativityjust doesnt exist in my life. If I tried to follow their advice, Id be setting myself up for failure or burnout. Here are just a few staples of popular productivity books that dont mesh with my life as a working mother: Early-Morning Routines: Waking at dawn isnt viable if youre up at night with a restless kid or catching up on work after bedtime. Even if I do manage to rise before the sun, I often have immediate caregiving tasks. Long, Uninterrupted Blocks of Deep Work: A meeting-heavy work schedule coupled with planned obligations, unplanned crises, and countless mom, can you help me? moments mean interruptions are part of my normal. Outsourcing Everything: Emotional laborlike scheduling playdates and tracking immunizationsdoesnt vanish just because you hire a virtual assistant. Plus, not everyone can afford or justify it. Rigid Scheduling or Time Blocking: Kids dont operate on neat timetables (and, really, work doesnt either). Its tough to block off an hour for anything when a single text from school can upend your day. Cutting Obligations. For mothers, certain obligations arent optional (e.g., kids doctor appointments, parent-teacher conferences, emotional support). How I stay productive (and happy) I didnt learn these tactics from a book, but Ive discovered my own methods that workwith motherhood, work demands, and a rich personal life. 1. Appropriate MultitaskingYes, multitasking often gets a bad rep, but Ive found a sweet spot when combining tasks that use different parts of my brain. Years ago, my then-5-year-old refused to sleep unless I sat in the corner of his room. While I waited for him to drift off, I wrote huge sections of my book on my phone. I also created an entire art series using Post-it notes and Sharpies during meetings where I only needed to listen, not present. I listen to audiobooks and podcasts while commuting or walking the dog. For me, its about being respectful to the momentif Im in a collaborative meeting or spending quality time with someone, I focus. But when theres an open lane to combine activities without shortchanging anyone, I take it. 2. Energizing ActivitiesThe biggest productivity hack, in my experience, is to fill my life with meaningful work and relationships. I dont have to muster the willpower to juggle my projects if they invigorate me. If I start feeling drained or resentful, thats a sign I need to rethink how Im spending my time. Surrounding myself with people, initiatives, and side projects that fill my cup ensures I have more energy for everything. 3. Rethinking productivityMaybe the most crucial shift is defining productivity on my own terms. I view time with my family and friends as productiveIm investing in relationships that matter. Creative hobbieslike aerial arts or art projectsare also productive, because they nourish my mental health. And rest is productive, because it replenishes the energy I need to show up fully in work and life. By refusing to measure myself strictly in terms of checked-off tasks or hours of deep work, Im able to free myself from the rigid structures that productivity books champion. Instead, I aim for a life thats fulfilling, balanced, and aligned with my prioritiesfamily, creativity, growth, and community. Im not knocking productivity gurus entirely; some people find motivation and clarity in those pages. But as a busy woman who shoulders domestic responsibilities alongside a big career and personal passions, I quickly realized their methods didnt reflect my world. If youre feeling squeezed by responsibilities and the standard advice rings hollow, dont assume youre doing it wrong. You might just need an approach shaped byand forthe realities of working moms. Remember: Your productivity isn’t measured by how well you follow someone else’s formulait’s measured by how effectively you create a life that works for you. The best lessons about getting things done don’t come from books written by those with different realities; they come from crafting your own path that honors all parts of who you are and what matters to you.
Category:
E-Commerce
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