Bloomberg Audio Studios, podcasts, radio news. You're listening to the Bloomberg Intelligence podcast. Catch us live weekdays at ten am Eastern on Apple Car, playing Android Auto with the Bloomberg Business app. Listen on demand wherever you get your podcasts, or watch us live on YouTube.

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Let's stay on the Ebie discussion. We can do that with Steve Mann at Global Autos and Industrials research Channels for Bloomberg Intelligence joining us from Princeton, Jersey. We got a little camera down there, so that is an incentive for the folks to stay in Princeton. I guess Steve Man. Don't get me started. Steve Man joins us though, Hey, Steve, talk to us about I guess President Biden. We're talking about tariffs on China evs and other strategic sectors. What's going on there.

Let's stay on the Ebie discussion. We can do that with Steve Mann at Global Autos and Industrials research Channels for Bloomberg Intelligence joining us from Princeton, Jersey. We got a little camera down there, so that is an incentive for the folks to stay in Princeton. I guess Steve Man. Don't get me started. Steve Man joins us though, Hey, Steve, talk to us about I guess President Biden. We're talking about tariffs on China evs and other strategic sectors. What's going on there.

It's not surprise that they're going to do that. In terms of the impact on the Chinese automaker, obviously nothing because they don't sell any vehicles to the US at the moment. They have no plans to, you know, byd actually explicitly said they have no plans to actually sell cars in the US at the moment. The only impact is really on the battery side. But I think what the government is trying to do is really to protect a lot of investments that's already been made to onshore EV battery production. You know, through the Inflation Reduction Act, there's over one hundred billion dollars already spent on on shoring EV battery and other supply chain components for evs into the US. So I think, I think for automakers there's no impact, but it's it's it seems like it's more about posturing for for for the election later this year.

It's not surprise that they're going to do that. In terms of the impact on the Chinese automaker, obviously nothing because they don't sell any vehicles to the US at the moment. They have no plans to, you know, byd actually explicitly said they have no plans to actually sell cars in the US at the moment. The only impact is really on the battery side. But I think what the government is trying to do is really to protect a lot of investments that's already been made to onshore EV battery production. You know, through the Inflation Reduction Act, there's over one hundred billion dollars already spent on on shoring EV battery and other supply chain components for evs into the US. So I think, I think for automakers there's no impact, but it's it's it seems like it's more about posturing for for for the election later this year.

I have so many thoughts and feelings on this, but I do think the timing is so interesting. So we break the story on the day that Zeker is going public in the US market. I don't know that that feels you can buy stock of a China EV's company, but you can't buy the China evy car.

I have so many thoughts and feelings on this, but I do think the timing is so interesting. So we break the story on the day that Zeker is going public in the US market. I don't know that that feels you can buy stock of a China EV's company, but you can't buy the China evy car.

Uh. Is that weird to you?

Uh. Is that weird to you?

Uh, It's probably a good option to have, I think.

Uh, It's probably a good option to have, I think.

Uh.

Uh.

China EV sales is still growing relatively strong. I mean, it's slower this year than last year, but it's it's you know, it's it's no different than what Neil has done, what x Punk and Lee Auto has done. All these companies have listed in the US. I think for the most part, the purpose of this listing is really to build the brand Cachet. You know, they can actually say that we're a US listed company that goes really well with a lot of the Chinese consumer. So if you look at some of the sales Neil sales, Lee Auto and Xpunk sales after they listed in the US, they actually jumped uh in their in their home home turf.

China EV sales is still growing relatively strong. I mean, it's slower this year than last year, but it's it's you know, it's it's no different than what Neil has done, what x Punk and Lee Auto has done. All these companies have listed in the US. I think for the most part, the purpose of this listing is really to build the brand Cachet. You know, they can actually say that we're a US listed company that goes really well with a lot of the Chinese consumer. So if you look at some of the sales Neil sales, Lee Auto and Xpunk sales after they listed in the US, they actually jumped uh in their in their home home turf.

I have to backtrack. I mean, you know, Alex is way ahead of me on this. Can you tell me what Zeker is for the It's the first time in my life I've heard about the Zeker. It's a Chinese manufactured electric car. Correct, that's right.

I have to backtrack. I mean, you know, Alex is way ahead of me on this. Can you tell me what Zeker is for the It's the first time in my life I've heard about the Zeker. It's a Chinese manufactured electric car. Correct, that's right.

It's a premium evy maker. It actually comes competes with the Tesla and the Neil Neils and they sell around on average around the thirty seven forty dollars US dollars per vehicle. It's part of Jili, the parent company of the listed Jili Auto one seven five HK, So this is part of the Jili. It's you know, a lot of the actually a lot of the technology that Zeker has is also part of Vovo they're head of R and D is actually in Gothenburg, Sweden.

It's a premium evy maker. It actually comes competes with the Tesla and the Neil Neils and they sell around on average around the thirty seven forty dollars US dollars per vehicle. It's part of Jili, the parent company of the listed Jili Auto one seven five HK, So this is part of the Jili. It's you know, a lot of the actually a lot of the technology that Zeker has is also part of Vovo they're head of R and D is actually in Gothenburg, Sweden.

All right, Just for the IPO folks out there, this is a company. They priced their IPO last night at twenty one dollars a share. We just got a spread just popped up on my terminal. Bid twenty three, ask is twenty five has not opened yet, that's where the bid ass spread is. Won't keep you up to date on that throughout the day. So again, a cool new IPO out there, which is good Goldman Sachs, Morgan Stanley, Bank of America and China International Capital Corporate the underrator, So some big time name supporting this company.

All right, Just for the IPO folks out there, this is a company. They priced their IPO last night at twenty one dollars a share. We just got a spread just popped up on my terminal. Bid twenty three, ask is twenty five has not opened yet, that's where the bid ass spread is. Won't keep you up to date on that throughout the day. So again, a cool new IPO out there, which is good Goldman Sachs, Morgan Stanley, Bank of America and China International Capital Corporate the underrator, So some big time name supporting this company.

What's interesting is that Glee, the parent company, said it's indicated it will subscribe to more than ninety percent of the stock.

What's interesting is that Glee, the parent company, said it's indicated it will subscribe to more than ninety percent of the stock.

So yeah, so clearly that's still.

So yeah, so clearly that's still.

Wariness that exists in the EV market when that takes place.

Wariness that exists in the EV market when that takes place.

Here is my deep question. It's not very deep, by the way. If your goal is to.

Here is my deep question. It's not very deep, by the way. If your goal is to.

Decarbonize the world as fast as possible, why would you not flood the US market with the EV with cheap China EV cars. And if that's not the goal, and you want to green the economy, but also do it profitably for US companies.

Decarbonize the world as fast as possible, why would you not flood the US market with the EV with cheap China EV cars. And if that's not the goal, and you want to green the economy, but also do it profitably for US companies.

That's okay. Just let's say that. I mean, is that? Can I say that out loud? Can I say the quiet part out loud? Steve? Does this make sense to you?

That's okay. Just let's say that. I mean, is that? Can I say that out loud? Can I say the quiet part out loud? Steve? Does this make sense to you?

Yeah?

Yeah?

I mean I think you have a very legitimate question. But I think you know, with with the geop uh wrangling between the two countries, uh, you know that that that so you know this comes to play, right, you know, do we flood the US? Do we protect the US industry? I think I think especially during this year when there's a lot of you know, to and fro on related to the election, I think there's gonna be more and more discussion around you know, do we let you know, Chinese products come in for example, Evy batteries and solar panels. So it's a very legitimate question. I think the government will have to answer that for you.

I mean I think you have a very legitimate question. But I think you know, with with the geop uh wrangling between the two countries, uh, you know that that that so you know this comes to play, right, you know, do we flood the US? Do we protect the US industry? I think I think especially during this year when there's a lot of you know, to and fro on related to the election, I think there's gonna be more and more discussion around you know, do we let you know, Chinese products come in for example, Evy batteries and solar panels. So it's a very legitimate question. I think the government will have to answer that for you.

All right, Steve, thanks so much for joining US. Steve Man Global Autos and Industrials Research Channels for Bloomberg Intelligence. You know, Alex I was up in Boston yesterday meeting with some of the really smart folks at BCG Boston Consulting Group, and one of the folks I spoke to was Ahead of their EVY consulting practice, and he acknowledged that the industry you know, probably put out some inferior products, didn't price them. Well, there's a lot of you know, the kind of a bumpy start to send the ev business. But he says that being said, a lot of good product is coming. Oh yeah, they're figuring out and they will lower their cost structure. And he thinks ultimately, you know, within a reasonable period of time, whether that's five years, ten years, he thinks forty percent of the cars in the US will be EV's. Oh interesting, So that's and I've heard that number a little bit more frequently recently because people are trying to make the sense we could ever beat a one hundred percent EVS And I think ultimately some people would like you to believe that, but that may or may not happen. But I kind of where they're coming from. They're kind of thinking about forty percent within that you know, kind of ten ten year time.

All right, Steve, thanks so much for joining US. Steve Man Global Autos and Industrials Research Channels for Bloomberg Intelligence. You know, Alex I was up in Boston yesterday meeting with some of the really smart folks at BCG Boston Consulting Group, and one of the folks I spoke to was Ahead of their EVY consulting practice, and he acknowledged that the industry you know, probably put out some inferior products, didn't price them. Well, there's a lot of you know, the kind of a bumpy start to send the ev business. But he says that being said, a lot of good product is coming. Oh yeah, they're figuring out and they will lower their cost structure. And he thinks ultimately, you know, within a reasonable period of time, whether that's five years, ten years, he thinks forty percent of the cars in the US will be EV's. Oh interesting, So that's and I've heard that number a little bit more frequently recently because people are trying to make the sense we could ever beat a one hundred percent EVS And I think ultimately some people would like you to believe that, but that may or may not happen. But I kind of where they're coming from. They're kind of thinking about forty percent within that you know, kind of ten ten year time.

I want to think about the implications for electricity production, the grid and balancing the grid.

I want to think about the implications for electricity production, the grid and balancing the grid.

You were talking to the right people, Yes, they need more of it.

You were talking to the right people, Yes, they need more of it.

And you want to know why utilities are some of the best performing stocks in the SMP this year.

And you want to know why utilities are some of the best performing stocks in the SMP this year.

I mean they're defensive names. Are they defensive anymore?

I mean they're defensive names. Are they defensive anymore?

They're growth stocks now they have actual growth in their business because of stuff like EV's.

They're growth stocks now they have actual growth in their business because of stuff like EV's.

I have so many more thoughts.

I have so many more thoughts.

You're listening to the Bloomberg Intelligence Podcast to catch us live weekdays at ten am Eastern on applecar Play and Androud Auto with a Bloomberg Business Act. You can also listen live on Amazon Alexa from our flagship New York station Just Say Alexa playing Bloomberg eleven thirty.

You're listening to the Bloomberg Intelligence Podcast to catch us live weekdays at ten am Eastern on applecar Play and Androud Auto with a Bloomberg Business Act. You can also listen live on Amazon Alexa from our flagship New York station Just Say Alexa playing Bloomberg eleven thirty.

Joanne Shu joins us. She's University of Michigan Surveys of Consumers Director.

Joanne Shu joins us. She's University of Michigan Surveys of Consumers Director.

This is her numbers. She does the data.

This is her numbers. She does the data.

Joanne, can you just walk us through that decline of US consumer sentiment right at a six month low?

Joanne, can you just walk us through that decline of US consumer sentiment right at a six month low?

Now? What let us here?

Now? What let us here?

So it's not just the worst of both worlds. I would say it's the worst on a number. It's worse on a number of dimensions. Not only do consumers expect inflation to rise a bit in the year ahead, but they are also expecting unemployment to worsen, and they're also expecting interest rates to rise, and so these are all things that had kind of been in a holding pattern for most of twenty twenty four, and suddenly in the month of May, consumers are seeing a deterioration on all of these dimensions.

So it's not just the worst of both worlds. I would say it's the worst on a number. It's worse on a number of dimensions. Not only do consumers expect inflation to rise a bit in the year ahead, but they are also expecting unemployment to worsen, and they're also expecting interest rates to rise, and so these are all things that had kind of been in a holding pattern for most of twenty twenty four, and suddenly in the month of May, consumers are seeing a deterioration on all of these dimensions.

So JO just like to call out the magnitude here again, the consensus was seventy six point two for the University Mission Sentiment Indicator seventy seven point two. Last period, it came in its sixty seven point four and on an order of magnitude, I don't remember seeing those types of variances in the past. How unusual is this may reading to you.

So JO just like to call out the magnitude here again, the consensus was seventy six point two for the University Mission Sentiment Indicator seventy seven point two. Last period, it came in its sixty seven point four and on an order of magnitude, I don't remember seeing those types of variances in the past. How unusual is this may reading to you.

This is a statistically significant to decrease, but I wouldn't call it a plummeting or a plunge. It definitely feels like that because the last four months, you know, since January, we've been only seeing little wiggles of one two points per month. Essentially, we've had no change for four months, and prior to that we had two months of really strong surges. So this is the first real downward movement we've seen in quite a bit of time. So I think it is jarring to people who watch the data, but it's not a plunge. It is a decline. It is a signific can decline, but it's not a plunge.

This is a statistically significant to decrease, but I wouldn't call it a plummeting or a plunge. It definitely feels like that because the last four months, you know, since January, we've been only seeing little wiggles of one two points per month. Essentially, we've had no change for four months, and prior to that we had two months of really strong surges. So this is the first real downward movement we've seen in quite a bit of time. So I think it is jarring to people who watch the data, but it's not a plunge. It is a decline. It is a signific can decline, but it's not a plunge.

You mentioned that those surveyed are worried about interest rates, and they're worried the interest rates are going to rise. Am I hearing that correctly, not that the Fed is going to keep them steady or not cut, but they expect higher interest rates.

You mentioned that those surveyed are worried about interest rates, and they're worried the interest rates are going to rise. Am I hearing that correctly, not that the Fed is going to keep them steady or not cut, but they expect higher interest rates.

Well, more people expect higher interest rates than last month. Fewer people expect interest rates to fall, so I believe about only about a quarter of consumers expect interest rates to fall in the year ahead. So overall, consumer expectations over interest rates are worse than they were last month.

Well, more people expect higher interest rates than last month. Fewer people expect interest rates to fall, so I believe about only about a quarter of consumers expect interest rates to fall in the year ahead. So overall, consumer expectations over interest rates are worse than they were last month.

Joanne, thank you so much for joining us. Really appreciate you hopping on there. Joinshew, Surveys of Consumers Director for the University of Michigan.

Joanne, thank you so much for joining us. Really appreciate you hopping on there. Joinshew, Surveys of Consumers Director for the University of Michigan.

You're listening to the Bloomberg Intelligence podcast. Catch us live weekdays at ten am Eastern on Apple, card Play and Endroid Auto with the Bloomberg Business app. Listen on demand wherever you get your podcasts, or watch us live on YouTube.

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You're having S and P just up by two tens of one percent, so we're definitely off the highs, but still. Kim Forrest, founder and CIO Booth of Capital Partners joined us. Now, Kim help me understand what's happening survey data, ism services, and if I be youmish pointing to things that are not that good. Equity market still near record highs, corporate profits, high earnings holding up really really well.

You're having S and P just up by two tens of one percent, so we're definitely off the highs, but still. Kim Forrest, founder and CIO Booth of Capital Partners joined us. Now, Kim help me understand what's happening survey data, ism services, and if I be youmish pointing to things that are not that good. Equity market still near record highs, corporate profits, high earnings holding up really really well.

What gives.

What gives.

Well?

Well?

I would say that the investors are looking past this information and they are planning for a longer time period than the consumer.

I would say that the investors are looking past this information and they are planning for a longer time period than the consumer.

We'll put it that way.

We'll put it that way.

But does that mean that? So how do you trade on that?

But does that mean that? So how do you trade on that?

Like, do you trust the underlying data and say, look, I mean the survey data and say, okay, maybe we're going to hit some speed bumps, I mean, protect myself for that.

Like, do you trust the underlying data and say, look, I mean the survey data and say, okay, maybe we're going to hit some speed bumps, I mean, protect myself for that.

Or do you say it.

Or do you say it.

Doesn't matter because these themes, even momentum and effect, a rotation.

Doesn't matter because these themes, even momentum and effect, a rotation.

Or AI, all of that just going to outweigh it.

Or AI, all of that just going to outweigh it.

I think it's a little bit of both.

I think it's a little bit of both.

First, I think that the con zoomer once again is being shocked by things they do pretty much at least once a week, if not more often, and that's fill up their car or truck with gasoline. And the second thing they do is go to the grocery store or a restaurant and prices are just crazy. So everybody has recency bias, and I believe strongly that food prices in particular and gas are just you know, demoralizing.

First, I think that the con zoomer once again is being shocked by things they do pretty much at least once a week, if not more often, and that's fill up their car or truck with gasoline. And the second thing they do is go to the grocery store or a restaurant and prices are just crazy. So everybody has recency bias, and I believe strongly that food prices in particular and gas are just you know, demoralizing.

Have you gone to the grocery store lately. I have? It is you know, it's just it's crazy.

Have you gone to the grocery store lately. I have? It is you know, it's just it's crazy.

You just you can't believe the basket of groceries costs that much, right, That's that's the first thing. And I do think that we have great expectation, probably deservedly so, although not on what I think Wall Street's timeline is for AI to increase productivity. It's been a decade or more since we've had something, a technology that we think could deliver productivity, productivity in.

You just you can't believe the basket of groceries costs that much, right, That's that's the first thing. And I do think that we have great expectation, probably deservedly so, although not on what I think Wall Street's timeline is for AI to increase productivity. It's been a decade or more since we've had something, a technology that we think could deliver productivity, productivity in.

A meaningful way.

A meaningful way.

And I think that's what has captured investors imagination around AI.

And I think that's what has captured investors imagination around AI.

And Kim, I was up at the Boston visiting the Boston Consulting Group yesterday, and the senior consultants that are you ask them what are your CEO clients asking you about? And to a person AI, I mean, it's it's just amazing. So Kim, as an investor, and as you talk to your clients and as you talk to other money managers, how do you suggest people really get a fundamental exposure to AI? Did they just run out and hold their nose of buying in video or how do you recommend the investors kind of get some exposure here.

And Kim, I was up at the Boston visiting the Boston Consulting Group yesterday, and the senior consultants that are you ask them what are your CEO clients asking you about? And to a person AI, I mean, it's it's just amazing. So Kim, as an investor, and as you talk to your clients and as you talk to other money managers, how do you suggest people really get a fundamental exposure to AI? Did they just run out and hold their nose of buying in video or how do you recommend the investors kind of get some exposure here.

Well, there are going to be people that want to own in Vidio because again I love the concept of recency bias, like it's gone up a lot, so it should keep going up, you know, forever and ever. And I think that's true to some extent. But we are probably probably going to hit a pothole where they miss expectations and that's just because of the and I'm getting in the weeds here, but go with me. The data center build out, I don't care if it's for regular data centers or AI. You reach a point at which you stop spending and you use the technology you have in a building for a while, and then you add more. So we're at the beginning of the build out of AI, so everybody wants to own in Nvidia. I think AMD and Intel are fine companies that are going to be able to participate in this, and they are going to push in Vidia to probably sell their product at a somewhat lower margin. And I think that both Intel a AMD can play in this space. So those are some ideas. I also think people should look further and keep their eye out for good software that is going to answer some problems. And what I mean by that is that it's not entertainment, only that you know, those CEOs would want to buy it to enhance their productivity, and that I think is the surest way to having a happy portfolio in five to seven years.

Well, there are going to be people that want to own in Vidio because again I love the concept of recency bias, like it's gone up a lot, so it should keep going up, you know, forever and ever. And I think that's true to some extent. But we are probably probably going to hit a pothole where they miss expectations and that's just because of the and I'm getting in the weeds here, but go with me. The data center build out, I don't care if it's for regular data centers or AI. You reach a point at which you stop spending and you use the technology you have in a building for a while, and then you add more. So we're at the beginning of the build out of AI, so everybody wants to own in Nvidia. I think AMD and Intel are fine companies that are going to be able to participate in this, and they are going to push in Vidia to probably sell their product at a somewhat lower margin. And I think that both Intel a AMD can play in this space. So those are some ideas. I also think people should look further and keep their eye out for good software that is going to answer some problems. And what I mean by that is that it's not entertainment, only that you know, those CEOs would want to buy it to enhance their productivity, and that I think is the surest way to having a happy portfolio in five to seven years.

So huh, a new thing in five to seven years. And I'm going to ask you about the next two and a half weeks. But we do get in video earnings. On May twenty second, I was talking to immobile servemen of RBC. She runs all their derivative strategy, and she was saying, this is the first time that they haven't seen a lot of sentiment upside going into nvideo. There's not the exuberants that we're used to seeing. What do you think the mark how do you think the market's going to react and take to in video's earnings?

So huh, a new thing in five to seven years. And I'm going to ask you about the next two and a half weeks. But we do get in video earnings. On May twenty second, I was talking to immobile servemen of RBC. She runs all their derivative strategy, and she was saying, this is the first time that they haven't seen a lot of sentiment upside going into nvideo. There's not the exuberants that we're used to seeing. What do you think the mark how do you think the market's going to react and take to in video's earnings?

Well, they're going.

Well, they're going.

To do it Wall Street does, which is overreact in the short term whichever way that is, and then get it right in the long term. I mean, I hate to be so perfunctory about it, but that is the last twenty five years of my life. Is you know, you get that if it is higher than expected. You're going to get a huge sugar rush upwards. It's a little bit you're going to get a sell off because there are people that are expecting this thing to just keep marching up straight, you know that forty five degree angle to the right.

To do it Wall Street does, which is overreact in the short term whichever way that is, and then get it right in the long term. I mean, I hate to be so perfunctory about it, but that is the last twenty five years of my life. Is you know, you get that if it is higher than expected. You're going to get a huge sugar rush upwards. It's a little bit you're going to get a sell off because there are people that are expecting this thing to just keep marching up straight, you know that forty five degree angle to the right.

Right.

Right.

But I don't think you should give up hope. This is just what markets do in the short term.

But I don't think you should give up hope. This is just what markets do in the short term.

So you mentioned AMD and Intel, what else? What other stocks you like to play this trend? You mentioned Synopsis SNPs is the ticker.

So you mentioned AMD and Intel, what else? What other stocks you like to play this trend? You mentioned Synopsis SNPs is the ticker.

What's that company?

What's that company?

Well, it's for people that design chips and we're going to need not just the AI chips, but to get real productivity, we're going to have to have armies of Internet of things and those will be robots, those will be sensors, and they're all going to be talking to back to the main computer and have the main computer tell them what to.

Well, it's for people that design chips and we're going to need not just the AI chips, but to get real productivity, we're going to have to have armies of Internet of things and those will be robots, those will be sensors, and they're all going to be talking to back to the main computer and have the main computer tell them what to.

Do, or at least gather that information. So there are going to have to.

Do, or at least gather that information. So there are going to have to.

Be more chips made and improvements to chips made. So that is how Synopsids benefits is from companies having to buy additional licenses or additional capabilities to its products. So I'm a strong believer. There's another company called Cadence. They are also in the same area, but we like Synopsis because of its breadth of product offerings.

Be more chips made and improvements to chips made. So that is how Synopsids benefits is from companies having to buy additional licenses or additional capabilities to its products. So I'm a strong believer. There's another company called Cadence. They are also in the same area, but we like Synopsis because of its breadth of product offerings.

What about What do you make of the consumer space? Do you like anything in the consumer space? The read through from earnings has been really confusing, like Starbucks and McDonald's warning on the consumer, but then Dutch Bros. Just crushed it yesterday.

What about What do you make of the consumer space? Do you like anything in the consumer space? The read through from earnings has been really confusing, like Starbucks and McDonald's warning on the consumer, but then Dutch Bros. Just crushed it yesterday.

What are we learning?

What are we learning?

We're learning we.

We're learning we.

Have a very picky consumer, as we should, right, I mean, I'm a picky consumer. I'm thinking you're a picky consumer. I might get an eye roll on this one, but I really love companies like Urban Outfitters that know that they can satisfy this really picky base of a customer set. They're not trying to sell product to everybody. They know who their consumer is and they have been through the decades able to delight and surprise this consumer, to get her to open her wallet. And it is a her in their case, to get to open the wallet and to spend for the new looks. And I think you need to know you don't want to you don't want to buy mass marketing. You want to buy narrow, niche kind of products that companies that do it well.

Have a very picky consumer, as we should, right, I mean, I'm a picky consumer. I'm thinking you're a picky consumer. I might get an eye roll on this one, but I really love companies like Urban Outfitters that know that they can satisfy this really picky base of a customer set. They're not trying to sell product to everybody. They know who their consumer is and they have been through the decades able to delight and surprise this consumer, to get her to open her wallet. And it is a her in their case, to get to open the wallet and to spend for the new looks. And I think you need to know you don't want to you don't want to buy mass marketing. You want to buy narrow, niche kind of products that companies that do it well.

So interesting it's like a very different story than just even a few years ago.

So interesting it's like a very different story than just even a few years ago.

Right, So what other? Yeah, go ahead.

Right, So what other? Yeah, go ahead.

Yeah.

Yeah.

I think that they do well in any kind of market because they have this small consume, small consumer base that has money and they want to look fresh and new, and that is what their secret is. They keep inventing and finding those designers and finding those shapes we don't have in our closet.

I think that they do well in any kind of market because they have this small consume, small consumer base that has money and they want to look fresh and new, and that is what their secret is. They keep inventing and finding those designers and finding those shapes we don't have in our closet.

Do you do you shop at Urban Outfitters?

Do you do you shop at Urban Outfitters?

Not really.

Not really.

I'm kind of a hipnie, but not that much of a hippie, but I get what they.

I'm kind of a hipnie, but not that much of a hippie, but I get what they.

Do, you know.

Do, you know.

Yeah, I know.

Yeah, I know.

I was like, you're extending this into a fashion discussion, you know, Yeah, and.

I was like, you're extending this into a fashion discussion, you know, Yeah, and.

Yeah, we do that.

Yeah, we do that.

We do that.

We do that.

I've known Kim for a long time and inevitably the end of our interview always goes to fashion. We've had this like hope and dream that one day we'll actually go shopping in New York together, but that has yet to materialize.

I've known Kim for a long time and inevitably the end of our interview always goes to fashion. We've had this like hope and dream that one day we'll actually go shopping in New York together, but that has yet to materialize.

Yes, Oh my gosh, I can't wait.

Yes, Oh my gosh, I can't wait.

Come on, I'm across two from Bloomingdale's. We' hit the sales sample stores. Okay, Kim, I'll let you go get back to your real job. Kim Forrest, founder and CIO a Boca Capital Partners standing by.

Come on, I'm across two from Bloomingdale's. We' hit the sales sample stores. Okay, Kim, I'll let you go get back to your real job. Kim Forrest, founder and CIO a Boca Capital Partners standing by.

You're listening to the Bloomberg Intelligence Podcast. Catch us live weekdays at ten am Eastern on Apple car Play and Android Auto with a Bloomberg Business Act. You can also listen live on Amazon Alexa from our flagship New York station, Just say Alexa play Bloomberg eleven thirty.

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Here's super interesting report that came out earlier in the week. You know the story, right, the great resignation. People left jobs during COVID, they got new jobs. Worker satisfaction isn't great, particularly among women, and yet is the grass greener. It's something that if you ever contemplated leaving your job for something else, you constantly think about, are there problems that are at every workplace? Or am I the problem and I'm bringing it with me? Well, now we may have some answers to this. Alan Swire is principal researcher of Human capital over at the Conference Board, and they had a survey out that said the workers who jumped CHIP during COVID are now regretting it. Alan, thanks for coming. This is great. I love this story. Can you walk us through your findings?

Here's super interesting report that came out earlier in the week. You know the story, right, the great resignation. People left jobs during COVID, they got new jobs. Worker satisfaction isn't great, particularly among women, and yet is the grass greener. It's something that if you ever contemplated leaving your job for something else, you constantly think about, are there problems that are at every workplace? Or am I the problem and I'm bringing it with me? Well, now we may have some answers to this. Alan Swire is principal researcher of Human capital over at the Conference Board, and they had a survey out that said the workers who jumped CHIP during COVID are now regretting it. Alan, thanks for coming. This is great. I love this story. Can you walk us through your findings?

Yeah?

Yeah?

Sure, So that one specifically was a big surprise to us because just last year when we ran the survey or twenty two, I should say, it was completely opposite to what we found this time. Measure of job satisfaction was up amongst those who switched jobs, but this year, overall job satisfaction was down by over five percentage points, and it was down across most of the twenty six components of satisfaction that we measure, so a big swing. We think we agree with your summary that you know, sometimes the grass isn't necessarily greener on the other side, and could be for a range of factors that this is happening, But we definitely see that this year those who have switched jobs during the pandemic are less satisfied than those who stayed.

Sure, So that one specifically was a big surprise to us because just last year when we ran the survey or twenty two, I should say, it was completely opposite to what we found this time. Measure of job satisfaction was up amongst those who switched jobs, but this year, overall job satisfaction was down by over five percentage points, and it was down across most of the twenty six components of satisfaction that we measure, so a big swing. We think we agree with your summary that you know, sometimes the grass isn't necessarily greener on the other side, and could be for a range of factors that this is happening, But we definitely see that this year those who have switched jobs during the pandemic are less satisfied than those who stayed.

Do we know what was the primary reason people did switch jobs during the pandemic was any different than other times, which is, you know, maybe higher pay or just a better opportunity.

Do we know what was the primary reason people did switch jobs during the pandemic was any different than other times, which is, you know, maybe higher pay or just a better opportunity.

Yeah, there were really pay increases during the pandemic that we hadn't seen for well over a decade's that's fairly well documented too, that some workers were receiving twenty thirty percent better offers just for switching jobs. And we think that you know, maybe some people took those offers without really thinking, you know, about the other elements that lead to happiness at work and contentment at work, like who you work with and whether the organization is going to invest in your career, career growth and many other things. So they went for the money maybe, and now they're starting to regret it.

Yeah, there were really pay increases during the pandemic that we hadn't seen for well over a decade's that's fairly well documented too, that some workers were receiving twenty thirty percent better offers just for switching jobs. And we think that you know, maybe some people took those offers without really thinking, you know, about the other elements that lead to happiness at work and contentment at work, like who you work with and whether the organization is going to invest in your career, career growth and many other things. So they went for the money maybe, and now they're starting to regret it.

I mean, it's so true, like the older I get, the more that I try and really distill down what makes me happy day to day, and it's so helpful. I mean, it took me a long time to figure that out, but it's so helpful and understanding it and sometimes staying put is the answer. You had a great point out that says once an employee hits a three year mark, satisfaction increases substantially.

I mean, it's so true, like the older I get, the more that I try and really distill down what makes me happy day to day, and it's so helpful. I mean, it took me a long time to figure that out, but it's so helpful and understanding it and sometimes staying put is the answer. You had a great point out that says once an employee hits a three year mark, satisfaction increases substantially.

Talk us through that.

Talk us through that.

Yeah, that's also a difference from what we've seen, not only in our own research, but there's a good amount of research out there that shows that usually it's people who have are shortened their tendon they start a new job, they're happy, there's a honeymoon period, and their engagement and their satisfaction levels are usually higher than people with more tenure. But this year, in our satisfaction survey, we saw the opposite, and that goes with the finding that job switchers are less satisfying than job stayers, maybe for some of the same reasons. Those who switch jobs. They're the people who are in the positions with less than three years tenure, and they're seeing that, yeah, things aren't quite as good as they might have hoped, even if their wages are higher than if they had stayed. So that's really good reinforcement that those two elements that we examine in this report really compliment each other.

Yeah, that's also a difference from what we've seen, not only in our own research, but there's a good amount of research out there that shows that usually it's people who have are shortened their tendon they start a new job, they're happy, there's a honeymoon period, and their engagement and their satisfaction levels are usually higher than people with more tenure. But this year, in our satisfaction survey, we saw the opposite, and that goes with the finding that job switchers are less satisfying than job stayers, maybe for some of the same reasons. Those who switch jobs. They're the people who are in the positions with less than three years tenure, and they're seeing that, yeah, things aren't quite as good as they might have hoped, even if their wages are higher than if they had stayed. So that's really good reinforcement that those two elements that we examine in this report really compliment each other.

And Alan your survey kind of goes to an issue Alex and I were just talking about today. The least satisfied group is fully on site workers. The hybrid model wins the day. I guess the hybrid model that is the new normal for the foreseeable future, isn't it.

And Alan your survey kind of goes to an issue Alex and I were just talking about today. The least satisfied group is fully on site workers. The hybrid model wins the day. I guess the hybrid model that is the new normal for the foreseeable future, isn't it.

Yeah, I think it is. I think employers or most employers that not all see the benefits of the hybrid model. You get the best of both worlds if it's done right. Some of employees who can work from home may be more productive at home for some types of work, but when it comes to collaboration, building trust in relationships, and innovation there at work. For several days a week. So if they do it right, they're getting the best of both worlds. But what's really interesting is that job as that workers see this too. You know, even though we see sometimes that workers say I'd love to work five days remote, maybe they also see the benefits of being with their colleagues two or three days a week.

Yeah, I think it is. I think employers or most employers that not all see the benefits of the hybrid model. You get the best of both worlds if it's done right. Some of employees who can work from home may be more productive at home for some types of work, but when it comes to collaboration, building trust in relationships, and innovation there at work. For several days a week. So if they do it right, they're getting the best of both worlds. But what's really interesting is that job as that workers see this too. You know, even though we see sometimes that workers say I'd love to work five days remote, maybe they also see the benefits of being with their colleagues two or three days a week.

There's literally no bone in my body that ever wants to work at home. Again, Like the eight weeks during COVID with a camera set up my living room was more than enough. Are we noticing any distinction in terms of the types of jobs we're talking about in terms of say, you know, women versus men or any ethnicity.

There's literally no bone in my body that ever wants to work at home. Again, Like the eight weeks during COVID with a camera set up my living room was more than enough. Are we noticing any distinction in terms of the types of jobs we're talking about in terms of say, you know, women versus men or any ethnicity.

We did see big differences with women. For the seventh year in a row. Women are significantly less satisfied than men, and that gap through between twenty twenty two and twenty twenty three. And you know, those the main reasons or drivers of that dissatisfaction are around hay, whether that's wages or bonuses or even promotions, and also around the flexibility of work. So by that I mean some of the benefits like vacation and familyly. And it's not too surprising because we see that even in twenty twenty four women are making eighty two point five cents on the dollar for men, and that most of the burden of care, whether it's for kids or sea or parents, and most of the household work falls on women still, so this is really reflected in results. And for the past seven years we did not collect data on race. We are contemplating doing that race and ethnicity next year.

We did see big differences with women. For the seventh year in a row. Women are significantly less satisfied than men, and that gap through between twenty twenty two and twenty twenty three. And you know, those the main reasons or drivers of that dissatisfaction are around hay, whether that's wages or bonuses or even promotions, and also around the flexibility of work. So by that I mean some of the benefits like vacation and familyly. And it's not too surprising because we see that even in twenty twenty four women are making eighty two point five cents on the dollar for men, and that most of the burden of care, whether it's for kids or sea or parents, and most of the household work falls on women still, so this is really reflected in results. And for the past seven years we did not collect data on race. We are contemplating doing that race and ethnicity next year.

Hey, Alan Helmporten, are some of the I don't know, the fringe perks, whether it's a foosball table, food, you know, coffee machine, there's things that really came to the forefront or in the pandemic as employers tried to lure employees back to the office. It seems like a lot of companies made a lot of investments in that kind of stuff.

Hey, Alan Helmporten, are some of the I don't know, the fringe perks, whether it's a foosball table, food, you know, coffee machine, there's things that really came to the forefront or in the pandemic as employers tried to lure employees back to the office. It seems like a lot of companies made a lot of investments in that kind of stuff.

Yeah, I think you're right. We don't measure that specifically. We don't have a measure for sort of some of those extra perks that you're you're talking about, but we know, you know that organizations are doing their their their best to lure people to the office, and they're trying not to command people to the office with those extra perps. And probably it's a good idea, whether it has as much impact as a good health plan, probably not, or even a good strong you know, talent culture where people collaborate and respect each other. They're probably not, but some of those things definitely helped to entice people back to the office.

Yeah, I think you're right. We don't measure that specifically. We don't have a measure for sort of some of those extra perks that you're you're talking about, but we know, you know that organizations are doing their their their best to lure people to the office, and they're trying not to command people to the office with those extra perps. And probably it's a good idea, whether it has as much impact as a good health plan, probably not, or even a good strong you know, talent culture where people collaborate and respect each other. They're probably not, but some of those things definitely helped to entice people back to the office.

Just giving my coffee, you know, like I definitely don't care, Slash want a foosball table. Alan, thanks a lot, really interesting stuff. Great to sort of break all of that down, Alan Swire, principal researcher human Capital at the conference board, joining us from Savannah, Georgia. I mean, none of this surprises me, But I also wonder if our tolerance is changing what work life balance means in a very different way.

Just giving my coffee, you know, like I definitely don't care, Slash want a foosball table. Alan, thanks a lot, really interesting stuff. Great to sort of break all of that down, Alan Swire, principal researcher human Capital at the conference board, joining us from Savannah, Georgia. I mean, none of this surprises me, But I also wonder if our tolerance is changing what work life balance means in a very different way.

Yes, I think I think that has changed for a lot of people, and they express in different ways, you know, leaving the workforce the only working places that have hybrid all that kind of stuff. So yeah, then there are the special people like us who just come back every day of the week.

Yes, I think I think that has changed for a lot of people, and they express in different ways, you know, leaving the workforce the only working places that have hybrid all that kind of stuff. So yeah, then there are the special people like us who just come back every day of the week.

Yeah.

Yeah.

And to be fair, like my husband does most of the childcare and he always has, so I just want to shout out that I'm not one of those women that have to do more of the childcare.

And to be fair, like my husband does most of the childcare and he always has, so I just want to shout out that I'm not one of those women that have to do more of the childcare.

We love the husband.

We love the husband.

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All right, let's turn a conversation to AI. Yesterday I attended the Boston Consulting Group EDGE Expo in Boston. Had a lot of great conversations with the folks at BCG. A lot are really smart people thinking about some important issues for their clients. I first book with Steve Mills, chief AI ethics Officer. He focuses on the risks for businesses and forging ahead with AI without considering how to do that in a responsible ethical manner. I began by asking him to talk about his role and how he thinks it about AI from an ethics perspective. Let's take a lism the.

All right, let's turn a conversation to AI. Yesterday I attended the Boston Consulting Group EDGE Expo in Boston. Had a lot of great conversations with the folks at BCG. A lot are really smart people thinking about some important issues for their clients. I first book with Steve Mills, chief AI ethics Officer. He focuses on the risks for businesses and forging ahead with AI without considering how to do that in a responsible ethical manner. I began by asking him to talk about his role and how he thinks it about AI from an ethics perspective. Let's take a lism the.

Way we think about it, and particularly as you start talking about generative AI. A responsible generative AI system needs to be proficient, meaning it does the thing.

Way we think about it, and particularly as you start talking about generative AI. A responsible generative AI system needs to be proficient, meaning it does the thing.

We want well, okay, you know.

We want well, okay, you know.

So if it's a question answer system, it can actually accurately answer questions, and that's key to driving value with these systems. That's the first piece. It needs to be safe and equitable. So these are the things like bias and you know, harmful language and the like. It needs to be secure, and then it needs to be compliant with laws and regulations. And so as we're building AI on behalf of our clients, as we're helping clients navigate these issues, those are the things we're trying to guard against.

So if it's a question answer system, it can actually accurately answer questions, and that's key to driving value with these systems. That's the first piece. It needs to be safe and equitable. So these are the things like bias and you know, harmful language and the like. It needs to be secure, and then it needs to be compliant with laws and regulations. And so as we're building AI on behalf of our clients, as we're helping clients navigate these issues, those are the things we're trying to guard against.

What are the some of the common risks that are really out there for implementing AI across a product, across the service that you've seen so far, because it feels like we're still in the very very early innings of this AI discussion.

What are the some of the common risks that are really out there for implementing AI across a product, across the service that you've seen so far, because it feels like we're still in the very very early innings of this AI discussion.

Yeah, I mean the most common things, particularly you know, we see a lot of chatbots for example, it is.

Yeah, I mean the most common things, particularly you know, we see a lot of chatbots for example, it is.

Things like.

Things like.

Biased language or you know, sexist language in a subtle way. Typically it's not over, but it can come across in a subtle way. Very security flaws. You know, when you issue a certain prompt to the system, it reveals sensitive data. We've seen examples of you know, people being able through smart prompting of the system manipulate it to offer products for you know, next to nothing, basically, you know, inaccurate you know answers or you know, people refer to to offen its hallucinations. But you know, again like basically the wrong answer coming out of the system that the company is then held viable for after the fact. So these are all things I'm sort of picking from the headlines that we've seen.

Biased language or you know, sexist language in a subtle way. Typically it's not over, but it can come across in a subtle way. Very security flaws. You know, when you issue a certain prompt to the system, it reveals sensitive data. We've seen examples of you know, people being able through smart prompting of the system manipulate it to offer products for you know, next to nothing, basically, you know, inaccurate you know answers or you know, people refer to to offen its hallucinations. But you know, again like basically the wrong answer coming out of the system that the company is then held viable for after the fact. So these are all things I'm sort of picking from the headlines that we've seen.

It seems to me that before you guys walk into my office, I think I have to have a commitment to do this thing ethically before I spend dollar one. Is that the kind of the message you want to get across to these people, Like, listen, guys, you got to buy into this, implement this because this is a powerful tool, maybe more powerful than maybe we even know at this point.

It seems to me that before you guys walk into my office, I think I have to have a commitment to do this thing ethically before I spend dollar one. Is that the kind of the message you want to get across to these people, Like, listen, guys, you got to buy into this, implement this because this is a powerful tool, maybe more powerful than maybe we even know at this point.

Yeah, that's exactly right.

Yeah, that's exactly right.

I always say you cannot deploy and scale GENAI without responsible AI. And it kind of comes in two as one is, organizations are realizing there's these risks, there's there's regulation, you need this in place to minimize those risks so you can do it confidently. At the same time, we see it as a source of value both directly and indirectly. What I mean by that is companies with mature respond AI programs, and this came from research we did with MIT, if they have a mature responsibili program, they report higher customer engagement, better customer retention, higher customer trust, better long term profitabilities. That's sort of the direct piece, and faster innovation too.

I always say you cannot deploy and scale GENAI without responsible AI. And it kind of comes in two as one is, organizations are realizing there's these risks, there's there's regulation, you need this in place to minimize those risks so you can do it confidently. At the same time, we see it as a source of value both directly and indirectly. What I mean by that is companies with mature respond AI programs, and this came from research we did with MIT, if they have a mature responsibili program, they report higher customer engagement, better customer retention, higher customer trust, better long term profitabilities. That's sort of the direct piece, and faster innovation too.

By the way.

By the way.

The indirect piece is they also report they get more value from their AI investment, which I think is really interesting and the intuition there is many of the things you do to build product responsibly just makes better product in the first place, and so it's not really that much of a surprise that if you do those things you build better product.

The indirect piece is they also report they get more value from their AI investment, which I think is really interesting and the intuition there is many of the things you do to build product responsibly just makes better product in the first place, and so it's not really that much of a surprise that if you do those things you build better product.

Do you get more value from your AI? Are there in your experience?

Do you get more value from your AI? Are there in your experience?

Have you had companies that do better than others that make a bigger commitment or what's kind of like a best use case from your perspective, what's your not your pitch, but what's your best idea best practice when you go into talk to clients.

Have you had companies that do better than others that make a bigger commitment or what's kind of like a best use case from your perspective, what's your not your pitch, but what's your best idea best practice when you go into talk to clients.

Well, I mean we always talk about, you know, what we see as a mature responsible AI program that you know, at its heart, there's there's basically a strategy that's really bridging between corporate value and the AI strategy the company itself, and this is a means to bring those two things together and then there's you know, the governance, the processes, all the tools, but ultimately you want this underpinned by a culture of responsibility.

Well, I mean we always talk about, you know, what we see as a mature responsible AI program that you know, at its heart, there's there's basically a strategy that's really bridging between corporate value and the AI strategy the company itself, and this is a means to bring those two things together and then there's you know, the governance, the processes, all the tools, but ultimately you want this underpinned by a culture of responsibility.

Who checks that?

Who checks that?

Like I'm wondering, like are auditors being trained now not wanted to look at financial statements but also and controls and so on and so forth, but also you know data really Like Bloomberg, we take data security extraordinarily seriously as a data driven company. I would think that almost any company now that is employing some level of AI.

Like I'm wondering, like are auditors being trained now not wanted to look at financial statements but also and controls and so on and so forth, but also you know data really Like Bloomberg, we take data security extraordinarily seriously as a data driven company. I would think that almost any company now that is employing some level of AI.

There's going to be risk.

There's going to be risk.

Who checks on that?

Who checks on that?

Yeah, it's a great question, and we're honestly extremely nascent in this space. There are no standards yet for AI. Therefore there's really no audit. Now You've got folks like the Responsible AI Institute, which is a nonprofit that has created a certification standard which some companies are following. I think this is to change extremely rapidly. The EU just past the AI Act. Very soon weel see standards associate with that, and so I think we will start to see this really come to the fore very very quickly.

Yeah, it's a great question, and we're honestly extremely nascent in this space. There are no standards yet for AI. Therefore there's really no audit. Now You've got folks like the Responsible AI Institute, which is a nonprofit that has created a certification standard which some companies are following. I think this is to change extremely rapidly. The EU just past the AI Act. Very soon weel see standards associate with that, and so I think we will start to see this really come to the fore very very quickly.

It's interesting mention Europe because we've seen just with technology in general Europe and privacy, for example, data privacy Europe ahead of the US, And I would argue, you know, if you go all the way back to the eighties and early nineties with Microsoft in terms of just dominance of US technology, do you expect other parts of the world to maybe be a little bit more out front on some of the regulations of this new technology visa be the US or because I know, BCG's a global business, you see everybody.

It's interesting mention Europe because we've seen just with technology in general Europe and privacy, for example, data privacy Europe ahead of the US, And I would argue, you know, if you go all the way back to the eighties and early nineties with Microsoft in terms of just dominance of US technology, do you expect other parts of the world to maybe be a little bit more out front on some of the regulations of this new technology visa be the US or because I know, BCG's a global business, you see everybody.

Yeah, I mean, we're starting to see a patchwork or regulation. The EU, I would say, is the first place we're seeing comprehensive AI specific regulation. But in the US the administration has directed the executive branch enforcement agencies to take existing regulations and apply them to AI, and so we're seeing that with Consumer Financial Protection, Fair Housing, FDA.

Yeah, I mean, we're starting to see a patchwork or regulation. The EU, I would say, is the first place we're seeing comprehensive AI specific regulation. But in the US the administration has directed the executive branch enforcement agencies to take existing regulations and apply them to AI, and so we're seeing that with Consumer Financial Protection, Fair Housing, FDA.

You know.

You know.

So while we in the US don't have the AI specific regulation, there is certainly regulation applied to AI right now. So this is the situation we're in, in this odd patchwork emerging and US states honestly for passing regulation states.

So while we in the US don't have the AI specific regulation, there is certainly regulation applied to AI right now. So this is the situation we're in, in this odd patchwork emerging and US states honestly for passing regulation states.

Okay, yeah, interesting, what are are there certain industries today here again early stages of AI, that seem to be more open to making the investments in AI, making the commitment to AI. I would think technology companies probably defined as opposed to I don't know a manufacturer company in the Midwest that says this doesn't really apply to me.

Okay, yeah, interesting, what are are there certain industries today here again early stages of AI, that seem to be more open to making the investments in AI, making the commitment to AI. I would think technology companies probably defined as opposed to I don't know a manufacturer company in the Midwest that says this doesn't really apply to me.

What are your discussions?

What are your discussions?

How do they go?

How do they go?

Yeah?

Yeah?

I mean I think big technology companies are absolutely at the foror of this space. You know, from years ago they were working on these topics. The other place we're seeing a lot of maturity is the highly regulated industry in healthcare, insurance finance. Not surprising in that they've historically had model risk management functions. You know, they've got regulators looking at them, and so they've been very proactive. I think other industries, there are absolutely very mature companies in every industry, but I think if.

I mean I think big technology companies are absolutely at the foror of this space. You know, from years ago they were working on these topics. The other place we're seeing a lot of maturity is the highly regulated industry in healthcare, insurance finance. Not surprising in that they've historically had model risk management functions. You know, they've got regulators looking at them, and so they've been very proactive. I think other industries, there are absolutely very mature companies in every industry, but I think if.

We're talking broad brushstrokes, others are lagging behind. I was just talking and mentioned to somebody else. AI seem to have come out of nowhere.

We're talking broad brushstrokes, others are lagging behind. I was just talking and mentioned to somebody else. AI seem to have come out of nowhere.

And how do you think about the evolution of AI? Is this just the big data discussion we had five years ago or is it just the commitment we made in the eighties and nineties that oh boy, everything's going digital, we better start spending more on it. How do you guys think about the evolution of AI? Because I could see a CEO or a board member saying to you, I don't understand it. Haven't we been spending on technology for the past twenty five years.

And how do you think about the evolution of AI? Is this just the big data discussion we had five years ago or is it just the commitment we made in the eighties and nineties that oh boy, everything's going digital, we better start spending more on it. How do you guys think about the evolution of AI? Because I could see a CEO or a board member saying to you, I don't understand it. Haven't we been spending on technology for the past twenty five years.

I mean, I really believe that the generative AI explosion we've seen is an inflection point. It is something fundamentally different, and I don't think we fully know how it will impact everything. But I mean, you're seeing the degree of hype around it. Yes, there is some hype, but it's well founded. I mean, I think we're talking on par with the Internet in some ways of how it could be transformative inside organizations, And we're still discovering the capabilities, right, That's some the unique thing about it, the emerging capabilities we see and so each you know, each generation a model that's being released is just so much more performant and can do so much more.

I mean, I really believe that the generative AI explosion we've seen is an inflection point. It is something fundamentally different, and I don't think we fully know how it will impact everything. But I mean, you're seeing the degree of hype around it. Yes, there is some hype, but it's well founded. I mean, I think we're talking on par with the Internet in some ways of how it could be transformative inside organizations, And we're still discovering the capabilities, right, That's some the unique thing about it, the emerging capabilities we see and so each you know, each generation a model that's being released is just so much more performant and can do so much more.

And so the question is where where does it end?

And so the question is where where does it end?

But even with what we have today, there are so many applications we haven't explored yet.

But even with what we have today, there are so many applications we haven't explored yet.

So what's kind of your when you walk into see a client? How do you how do you lead off?

So what's kind of your when you walk into see a client? How do you how do you lead off?

Do you do you just say I'm going to try to My goal today is to get you to commit or consider committing to an ethical implementation of your tech investment. Is that kind of your pitch or what how do you walk into when you see a client?

Do you do you just say I'm going to try to My goal today is to get you to commit or consider committing to an ethical implementation of your tech investment. Is that kind of your pitch or what how do you walk into when you see a client?

Yeah, in essence, it's you know, it's the message I sort of led with earlier that you cannot scale Jenai without doing it in a responsible way. And it's twofold, like, yes, there's absolutely a risk mitigation play, both for the company but even more importantly for customers, right because you have the potential to create an unintended harm to individuals, so like full stop, we need to avoid that. But from a corporate perspective, there there's certainly risk, but there's also this value side. It's not just about mitigating risk, it's about making sure you realize the value. And so that's always the message because I think the risk is motivating to a point. But then it's okay if you want to make this investment in AI anyway, if you want to see that value, you need to make this investment to do it in a responsible way.

Yeah, in essence, it's you know, it's the message I sort of led with earlier that you cannot scale Jenai without doing it in a responsible way. And it's twofold, like, yes, there's absolutely a risk mitigation play, both for the company but even more importantly for customers, right because you have the potential to create an unintended harm to individuals, so like full stop, we need to avoid that. But from a corporate perspective, there there's certainly risk, but there's also this value side. It's not just about mitigating risk, it's about making sure you realize the value. And so that's always the message because I think the risk is motivating to a point. But then it's okay if you want to make this investment in AI anyway, if you want to see that value, you need to make this investment to do it in a responsible way.

And that I guess is that message getting through?

And that I guess is that message getting through?

Do you think I think it is.

Do you think I think it is.

I think companies are still like there's I would say two things we're seeing. One it is the topic of responsibile AI has not been elevated senior enough inside organizations.

I think companies are still like there's I would say two things we're seeing. One it is the topic of responsibile AI has not been elevated senior enough inside organizations.

Yet I argue it's a c suite issue. It has to be. If AI is a c suite issue, this needs to be.

Yet I argue it's a c suite issue. It has to be. If AI is a c suite issue, this needs to be.

Too often we're seeing it a few layers down inside the organization, and it's people who are passionate and brilliant and wanted to do good things, but they don't have the clout inside the organization really drive the kind of change you need.

Too often we're seeing it a few layers down inside the organization, and it's people who are passionate and brilliant and wanted to do good things, but they don't have the clout inside the organization really drive the kind of change you need.

I mean, I mentioned this is a cultural change. You need senior people.

I mean, I mentioned this is a cultural change. You need senior people.

So that's one, and then two, they're just not putting the right right amount of resourcing any right. I think this is being seen as you know, smaller dollar we can do a few little.

So that's one, and then two, they're just not putting the right right amount of resourcing any right. I think this is being seen as you know, smaller dollar we can do a few little.

Things and do it responsibly. It's a much bigger investment.

Things and do it responsibly. It's a much bigger investment.

And if you think about you brought up privacy earlier like GDPR or cyber sure. I mean if you look back at some of the data, we're talking tens of millions of dollars to get compliant with GDPR. It's the same thing here and companies need to be ready for that degree of investment.

And if you think about you brought up privacy earlier like GDPR or cyber sure. I mean if you look back at some of the data, we're talking tens of millions of dollars to get compliant with GDPR. It's the same thing here and companies need to be ready for that degree of investment.

All right.

All right.

That was Steve Mills, chief AI ethics officer at the Boston Consulting Group. I spoke with them up in Boston yesterday. And what was interesting A that they have a chief AI ethics officer. Wouldn't have thought at that, didn't even think about it. But b they say at BCG, when they got to talk to one of their clients about AI and making the investment in AI and the commitment in AI, they say, listen, we're not going to engage with you unless you make the commitment that ethics and the management ethics is going to be at a board level commitment because if not, there are so many pitfalls that we don't even know about. And before you start rushing off to make your investments in technology, you better recognize that you need to manage the risk here. So from their perspective, at least at BCG, that's how they try to engage with their clients.

That was Steve Mills, chief AI ethics officer at the Boston Consulting Group. I spoke with them up in Boston yesterday. And what was interesting A that they have a chief AI ethics officer. Wouldn't have thought at that, didn't even think about it. But b they say at BCG, when they got to talk to one of their clients about AI and making the investment in AI and the commitment in AI, they say, listen, we're not going to engage with you unless you make the commitment that ethics and the management ethics is going to be at a board level commitment because if not, there are so many pitfalls that we don't even know about. And before you start rushing off to make your investments in technology, you better recognize that you need to manage the risk here. So from their perspective, at least at BCG, that's how they try to engage with their clients.

What is the what's the reaction to that? Did you say, I.

What is the what's the reaction to that? Did you say, I.

Think they get it. I think they get it because I think he says, they were saying, the clients are basically like, you know, we'll spend the money to upgrade our tech and do all that kind of stuff because we can't be left behind. That's the biggest risk that the BCG CEOs say, we can't risk getting left behind. So their in tendency is just to spend, spend, spend, spend without really thinking about how to do it smartly and overtime and do it responsibly. They feel like if they don't, their competitors will and they'll be left in the dust. So very interesting discussion about AI and how it's really involved with all their discussions.