Fed’s Tom Barkin, a former McKinsey CFO, says the ‘AI Apocalypse’ hasn’t arrived
Source: Fortune ·
The Richmond Fed president says companies are investing heavily in AI to boost productivity, but strong earnings are keeping them from making deep cuts to their workforces.
From the source
Good morning. The Federal Reserve raised interest rates for the first time since mid-2023 last week as some of the forces pushing up inflation prove harder to shake, Richmond Fed President and CEO Tom Barkin said Thursday. Barkin pointed to persistent tariff costs, higher gasoline prices and a huge wave of AI investment that is pushing up prices for some technology equipment during a conversation with Barbara Humpton, CEO of USA Rare Earth, at an Economic Club of Washington, D.C., event. Six months ago, he said, it was easier to argue that inflation’s persistence was temporary, and that oil prices, tariffs and the AI buildout would eventually “morph” away. “If inflation’s not going to come down relatively quickly,” Barkin said, “then you have to look in the mirror and say inflation looks like it’s been here for a while.” Barkin has a metaphor for the job Warsh has inherited: a log flume. “You go slowly up the hill of the last ramp, and then you go full speed down into a pool of…