AI, Oil Prices, and Mortgage Rates

Productivity, AI, and the Flow of Money: Why Deflation May Be Closer Than InflationFrom Waikiki, Hawaii, KP checks in with a wide angle view of the forces quietly shaping inflation, interest rates, housing demand, and the broader economy. With fresh PCE inflation data on deck, the 10-year Treasury hovering near key levels, and global uncertainty lingering, this episode explains why worker productivity—and not just Fed policy, may be the real driver of where rates go next.KP breaks down how rising productivity, fueled in part by rapid AI adoption, is creating deflationary pressure even as the economy continues to grow. He explores why tech giants like Microsoft and Google are continuing to invest billions into AI infrastructure, how those investments are already delivering measurable returns, and why the market is questioning when the massive spending will fully pay off.The conversation connects inflation trends, energy prices, and weakening job data with the bigger structural forces shaping the economy, including the massive concentration of wealth among Americans over 55, the resilience of consumer spending, and why the U.S. may be threading the needle with a rare engineered soft landing. KP also explains how money constantly rotates between stocks and bonds, why market volatility is normal, and how geopolitical risks could quickly change the inflation outlook.The episode closes with a grounded look at housing demand, the spring buying season, and why opportunity still exists for those willing to stay proactive, even in a complex and shifting environment.Episode Highlights:00:00 – Why rising worker productivity is deflationary0:20 – Credit conditions, borrowing rates, and corporate spending0:44 – KP checks in from Waikiki and sets the macro backdrop1:10 – Inflation data, PCE, and the importance of the 10-year Treasury1:32 – Mortgage policy discussions and Washington’s role2:40 – The flow of money between stocks and bonds explained3:20 – Tech volatility, AI spending, and ROI concerns4:20 – AI adoption, productivity gains, and corporate efficiency5:10 – Energy prices, CPI trends, and inflation outlook6:00 – Food inflation, job market weakness, and Fed implications7:20 – Wealth concentration, consumer spending, and GDP strength8:20 – Soft landing vs. rolling recession: where we stand now8:40 – Housing demand and the spring buying opportunityStay focused. Stay productive. Stay ready for opportunity.Follow for more insights: https://linktr.ee/kptalksdollarsandsense#Economy #Inflation #FederalReserve #HousingMarket #AI #Productivity #InterestRates #Macro #RealEstate #FinancePodcast #KPTalksDollarsAndSense