Robots

On Progress and the Market’s Long View

My children accuse me of living in the Stone Age when I communicate with them by email. Having failed to master the ins and outs of Snapchat, I’ve learned to follow my emails to them with a brief text message, a plea to read my email. This often elicits responses such as “?” or “SMH” (shaking my head) or even worse, insulting memes of people my age engaged in failing efforts to walk, talk, run, or use technology. Only occasionally do I learn they actually read my emails.

With these occasional “wins” in mind and with likely misplaced optimism, I sent them an email this morning. It contained a link to an article in the Wall Street Journal about Amazon’s automation initiatives and a brief message: “Good morning children! Check out the WSJ article below about automation. It says Amazon’s warehouses will soon employ more robots than people. The proliferation of these machines, and the growing use of AI tools like ChatGPT, Gemini, Grok, and Perplexity, which put all the world’s knowledge in the palm of our hands, means that for us lowly humans to remain relevant and employed, we must be problem solvers and leaders among the people within our companies, schools, communities, and charities. We must be well-adjusted people who are easy to love, easy to work with, and easy to follow. We must be great at dealing with others and with using technology. We’ll need to build lots of relationships and inspire confidence.” And then, because I anticipated my wife telling me I was putting a lot of pressure on our kids, I added, “Fortunately, each of you has the foundation and the tools to be just this person. I’m proud of you!” Crickets. So far. But we’ll see.

Amazon’s Robot Revolution: A Glimpse of the AI Future

The Wall Street Journal article I shared with my children, “Amazon Is on the Cusp of Using More Robots Than Humans in Its Warehouses” (June 30, 2025), paints a vivid picture of our AI-driven future. Amazon has deployed over 1 million robots—wheeled droids, robotic arms like Vulcan with a sense of touch, and humanoid bots like Digit—across its global warehouses, nearing parity with its 1.56 million human workers. These machines have some role in the delivery of over 75% of global Amazon deliveries, from sorting to lifting to packaging, with AI optimizing inventory and robot coordination. According to the article, inside Amazon’s Shreveport, Louisiana, 3-million-square-foot facility, robots glide efficiently from aisle to aisle, boosting productivity while humans shift to higher-skilled roles like robotics maintenance. CEO Andy Jassy notes that AI-driven automation enhances efficiency, with Amazon shipping 3,870 packages per employee annually, up from 175 in 2015, while reducing headcount at newer facilities. The company has trained 700,000 workers for advanced roles, signaling a transition, not elimination, of labor.

The accelerating robotic revolution occurring simultaneously with the adoption and extensive use of large language models like ChatGPT, which efficiently offer access to all human knowledge, will redefine industries—transportation and logistics, retail, healthcare, education, energy—creating efficiencies and opportunities unimaginable a decade ago. Amazon’s warehouses are a microcosm of what’s coming: a world where technology once again amplifies human potential.

Ford’s Warning: AI and White-Collar Jobs

The impact of AI extends beyond warehouses to corporate offices. At the Aspen Ideas Festival in June 2025, Ford Motor CEO Jim Farley warned, “Artificial intelligence is going to replace literally half of all white-collar workers in the US.” Farley noted that Ford is leveraging AI to streamline design, engineering, and administrative tasks, enhancing efficiency in areas like supply chain optimization and electric vehicle battery design. However, he cautioned that this could lead to substantial job reductions, with retraining efforts underway but challenges in transitioning all workers to new roles. This stark prediction, echoing anxieties about automation’s reach into professional roles, underscores the urgency of adapting to AI’s transformative power, as seen in Amazon’s warehouses, and raises critical questions about the future of work.

Tyler Cowen’s Reflections: AI and Our Human Future

Tyler Cowen, my favorite economist and podcaster (check him out on Spotify), is a singular intellect whose infectious optimism illuminates economics, culture, science, sports and beyond. A libertarian and a Professor of Economics at George Mason University and director of its Mercatus Center, a market-oriented research hub, Cowen is a prolific writer, penning columns for The New York Times and Bloomberg Opinion. He is also a dynamic speaker, hosting the Conversations with Tyler podcast, where he engages thinkers from Mark Zuckerberg to Martina Navratilova. In a recent article for The Free Press, “AI Will Change What It Is to Be Human. Are We Ready?”, co-authored with Avital Balwit, he gets personal about artificial intelligence. I read the article carefully, finding myself curious to learn what my absolute favorite intellectual really thought about our AI future.

In the article, Cowen admits to a quiet sadness: he and his peers—university professors, highly educated intellectuals who staked their identities on their cognitive superiority—will no longer be the smartest in the room. AI, with its unmatched prowess in writing, problem-solving, and diagnostics, has surpassed human cognition, signaling “the twilight of human intellectual supremacy.” I found it remarkable to read these profound words he’d written. Quiet sadness, indeed!

Yet, his libertarian optimism shines through. He sees AI as a catalyst for redefining humanity, pushing us toward uniquely human strengths—creativity, empathy, even athleticism—while amplifying our ability to solve grand challenges like disease, resource scarcity, and climate change. He envisions an “age of flourishing,” where AI enhances productivity, education, and connectivity, provided we adapt with purpose. For instance, AI could personalize learning globally or accelerate medical breakthroughs, slashing drug development costs. Cowen warns that adaptation requires humility—accepting AI’s cognitive edge while leveraging our human capacities. For investors, his perspective is a rallying cry to look beyond today’s uncertainties and embrace AI’s transformative promise, deepening our understanding of Amazon’s robot-driven future.

Are We Doomed? The AI Job Debate

So what are we to conclude? Are we doomed, with no jobs for anyone? The warnings from Ford’s Jim Farley and Amazon’s robot-filled warehouses fuel fears that AI will decimate employment, echoing concerns in my email to my children about staying relevant. Yet, history offers a counterpoint, as Marc Andreessen would argue. In his 2023 Techno-Optimist Manifesto, Andreessen, founder of Netscape—whose 1995 IPO sparked the internet boom—and venture capital titan at Andreessen Horowitz, calls technology humanity’s “superpower,” making us richer, healthier, and freer. He argues that innovations—from steam engines to the internet—have consistently expanded economies, creating new jobs and industries unimaginable before. The Luddites, 19th-century English workers who smashed textile machines fearing job loss, were proven wrong as technology drove prosperity. Consider these historical examples:

• Post-Industrial Revolution (1800s): Steam engines displaced weavers but created railway engineers, machinists, and factory foremen. By 1900, US manufacturing employed approximately 5 million, a significant increase from the early 1800s (Census Bureau).
• Post-Automobile (1900s): Ford’s assembly line (1913) ended buggy-making but spawned auto mechanics, road builders, and traffic engineers. By 1950, approximately 2 million worked in auto-related jobs (Bureau of Labor Statistics).
• Post-Telephone (1876): Telegraphs faded, but telephone operators (peaking at over 350,000 in the late 1940s), switchboard designers, and telecom engineers emerged. By the year 2000, the broader telecom industry employed approximately 1.4 million people (BLS).
• Post-Medical Advances (1900s): Penicillin and MRIs created radiologists, lab technicians, and biotech researchers. Healthcare currently employs over 20 million (BLS).
• Post-Internet (1990s): Travel agents waned, but web developers, network managers, digital marketers, and cybersecurity analysts arose. The tech sector today employs many millions of workers in roles like data scientists, many of which were nonexistent pre-1995 (BLS).
• Post-Aviation (1903): Flight led to airports, pilots, air traffic controllers, and drone operators. Aviation supports over 1 million jobs across its various segments (FAA).

AI will likely follow suit, automating thousands of tasks currently performed by humans but creating many thousands more new roles that currently don’t exist and which we can only imagine today. Amazon’s retraining of 700,000 workers for robotics roles is a case in point. The 2025 Future of Jobs Report, produced by the World Economic Forum, projects 78 million net new global jobs by 2030 (170 million new jobs created, 92 million roles displaced). Yet, we don’t know how fast AI will disrupt. Its adoption speed is unprecedented—ChatGPT reached 100 million users in two months, compared to Facebook’s 54 months or Twitter’s 60 months (Statista, 2023). Every company and organization is scrambling to adopt AI, fearing competitors will outpace them. Microsoft, for instance, integrates AI into cloud services, while hospitals use it for diagnostics. This urgency signals massive change in our near future, potentially outstripping past technological shifts. We’re at a crossroads—disruption is certain, but so is opportunity, as history suggests.

Why Is the Market Up So Much?

Despite Q2 2025’s turbulence—Russia’s Ukraine escalation, the US bombing of Iran’s nuclear facilities at Fordo, Natanz, and Isfahan on June 21, Gaza’s stalled peace talks, and domestic polarization, with 76% of Americans seeing democracy under serious threat (NPR/PBS News/Marist, June 23-25, 2025)—the S&P 500 has soared more than 24% from its low in April through the end of the quarter, and year-to-date is now up more than 6%. Why? For sure, the old reasons still apply. Investors are focused on factors impacting earnings: the Trump administration’s slashing of regulations, the passage of the “Big Beautiful Bill” ensuring low tax rates despite adding $3.3 trillion to the deficit, Supreme Court rulings curbing agency power (2024–2025), geopolitical progress (Iran’s nuclear setback and emerging Saudi-Israel talks fostering Middle East optimism), a resilient economy (low unemployment, moderating inflation and solid Q2 earnings growth), and the expectation that Trump will further moderate his tariff regime.

But arguably, an even greater driver is what I’ve written about today: AI’s promise to usher in a new era of economic activity, productivity, health, longevity, and convenience. Goldman Sachs projects AI could add $7 trillion to global GDP by 2035, doubling US productivity to 3% annually. Venture capital flows of $80 billion into AI startups (PitchBook, H1 2025) reflect this. Like the internet’s rise amid 1990s crises, AI captivates investors, who see it transforming industries, as Amazon and Ford demonstrate. The market is focused on the future and appears optimistic, betting on an AI-driven “age of flourishing.”

Risks and Prudence

Geopolitical risks—Ukraine, Iran, Gaza—could spike oil prices further, especially after the US bombing of Iran’s nuclear sites raised stability concerns. Political polarization in the US may cloud investor sentiment. Tariffs, if not further reduced by the Trump administration, may drive inflation and lead to further escalation by our trading partners. For example, further retaliation from China and the EU, which account for $400 billion in US exports annually, could negatively impact the agriculture and aerospace industries. Meanwhile, the $3.3 trillion increase in the budget deficit kicks the can on long-term fiscal concerns that ultimately must be addressed.

The S&P 500’s P/E (profit-to-earnings ratio) of 22, above its 20-year average of 18, risks a correction if AI hype outpaces earnings. On the bright side, according to Yardeni Research, S&P 500 earnings likely notched a healthy year-over-year gain during the second quarter.

Conclusion: Investing in Progress

Amazon’s robots, Ford’s warnings, Cowen’s humility, and Andreessen’s techno-optimism signal a future where AI drives prosperity. Despite regulatory risks, markets favor openness, limited government and competition. The S&P 500’s high reflects confidence in AI’s potential to expand the economic pie, benefiting all of humanity. As always, we think this is a good time to own a diversified portfolio of stocks, to maintain liquidity as needed and to rebalance with regularity. The market’s 20% decline and full recovery during the second quarter reminded us of the importance of staying the course. We expect more volatility in our future—whether from geopolitics, tariffs, or fiscal concerns—but discipline will get us through.

Here’s to a future of innovation and opportunity. Thank you for trusting Bragg Financial.

This information is believed to be accurate at the time of publication but should not be used as specific investment or tax advice as opinions and legislation are subject to change. You should always consult your tax professional or other advisors before acting on the ideas presented here.