Oct 16, 2024 · 1h 10m · big-technology
Fear Buying AI & Automation Stocks — With Downtown Josh Brown
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gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
In this episode of the Big Technology Podcast, host Alex Kantrowitz interviews financial advisor and author Josh Brown to analyze how societal anxiety over AI and automation fuels Big Tech equity valuations. They explore the macroeconomic impact of generative AI on the labor market, legacy business disruption, and the structural forces sustaining modern market rallies.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Alex holds 31.6% of the talking time here. How this is scored →
Alex as informed peer 4.9 Guest teaching 5.2 Guest disagreement 3.4 Alex pushing back 3.7
speaking balance: gold is Alex, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 44:45 Josh rejects post-work leisure utopia
Josh vigorously dismisses Alex's hypothetical post-work economy, characterizing the concept of purposeless leisure as a drug-fueled dorm room fantasy unmoored from human psychology.
Hardest push from Alex ▶ 16:00 Alex argues retailers must compete on human experienceAlex refuses Josh's framing that traditional businesses are helpless against tech giants, insisting they must differentiate by investing in customer experience and employee pay.
Biggest teaching moment ▶ 42:00 Josh explains automation economics via SweetgreenJosh educates Alex on modern automated food production using Sweetgreen's automated salad dispensers to demonstrate how machine efficiency displaces manual staffing.
Alex holds their own ▶ 1:00:45 Alex details Amazon's bureaucratic decline via Jassy memoAlex demonstrates deep reporting knowledge by quoting Andy Jassy's internal memo verbatim to detail bureaucratic bloat, pre-meetings, and cultural decay at Amazon.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Alex as informed peer | Guest teaching | Guest disagreement | Alex pushing back | Why |
|---|---|---|---|---|---|---|
| Fear-Driven Investing in AI and Automation Technologies | 4 | 3 | 2 | 3 | Alex quotes directly from Josh's book and questions whether the tech trade is truly fear of automation rather than general economic growth. Josh clarifies that AI uniquely threatens people's essence at work, creating the first fear-based investment bubble. | |
| Disruption Anxiety: Supermarkets, Pharmacies, and Big Tech | 5 | 5 | 3 | 5 | Alex challenges the fear narrative by arguing tech giants build platforms driving broader economic growth. Josh responds with market data regarding CVS and Walgreens' steep drawdowns, illustrating how big tech creates existential anxiety for legacy operators. | |
| Corporate Adaptation: Competing with Tech Through Human Experience | 6 | 6 | 5 | 6 | Alex cites Jeff Bezos's customer-first philosophy to argue legacy retailers should compete on human experience rather than technology. Josh counters that independent bookstores tried that and failed, and notes Amazon itself is pulling back on Amazon Go stores. | |
| AI Copilots and the Evolution of Workplace Expectations | 6 | 4 | 3 | 4 | Josh outlines how AI copilots will raise baseline employer expectations, comparing it to car safety haptics taking control. Alex presents an optimistic counterpoint citing open source workflows and Bezos's Recode remarks, though Josh notes many workers prefer rote certainty. | |
| AI Note-Taking and the Threat to Entry-Level Apprenticeship | 5 | 6 | 5 | 5 | Josh describes AI note-taking eliminating the traditional training path for junior financial advisors, repeatedly asking what firms will do with entry-level staff. Alex counters by pointing to medical automation and long-term demographic labor shortages in the US and Japan. | |
| The COVID Stimulus Experiment and the Breakdown of Capitalism | 4 | 5 | 3 | 2 | Alex reads Josh's passage analyzing how pandemic stimulus gave workers unprecedented freedom, breaking labor supply. Josh elaborates on how middle-class striving is essential to maintain the capitalist system, preventing mass hotel and logistics shutdowns. | |
| Robotic Automation, Human Purpose, and Player Piano | 4 | 7 | 6 | 4 | Alex asks if widespread leisure and flexibility could work without inflation. Josh sharply rejects this as an unrealistic dorm room fantasy, citing automated Sweetgreen kiosks, Vonnegut's Player Piano, and empirical client evidence that people require genuine purpose. | |
| Why the Looming Recession Failed to Materialize in 2024 | 3 | 5 | 1 | 1 | Alex asks why the widely expected 2023-2024 recession failed to occur. Josh relays insights from JP Morgan's David Kelly regarding supply-side healing, the resilience of a service-oriented economy, and the sudden emergence of generative AI. | |
| The Relentless Bid: 401(k) Inflows and Panic Buying | 5 | 6 | 2 | 2 | Alex brings up the 'relentless bid' concept, and Josh details how $11 trillion in automated 401(k) inflows and securities-based lending insulate stock prices. They discuss the August 2024 yen carry trade crash where retail investors immediately panic-bought the dip. | |
| Evaluating Mega-Cap Tech: Amazon, Apple, and Nvidia | 7 | 5 | 4 | 5 | Alex quotes Andy Jassy's memo highlighting bureaucratic sprawl at Amazon and challenges Apple's lag behind Meta in AI and mixed reality, alongside Nvidia's hardware pricing power. Josh defends Apple's massive cash flow and buyback power while highlighting sold-out Blackwell chip demand. |
Statements from this episode (23)
Josh Brown: Ability to ape humanity sets AI apart from prior tech waves
“I think in the case of AI, its ability to effectively ape humanity
Is what sets it apart from prior waves of technology.”
Josh Brown: AI boom may be the first fear-based investment bubble
“We might be in the first fear-based
Investment bubble ever. Normally when you have an investment bubble, it's greed. In this case, there's an element of, I better invest in this.”
Brown: Retail pharmacy chains CVS and Walgreens are going away
“All you have to do is look at a chart of CVS, which is in a 60% drawdown from a tie, or look at Walgreens Boots Alliance, which is in a 90% drawdown. These companies are going away.”
Brown: CVS's Aetna and Caremark acquisitions failed to deliver expected synergies
“CVS spent, like, huge amounts of money to buy Aetna, and to buy Caremark. So, buy an insurance company, buy a pharmacy pharmacy benefits manager, and basically, take, take a vertical approach to what was obviously going to be a consolidating industry. Those de…”
Brown: Amazon pushed out its touchless tech lead and is closing stores
“The guy that developed the touchless technology for Amazon's retail was just pushed out of the company, and they are closing A lot of those Amazon go stores because there just didn't seem to be anything magical that made people want to go to them.”
Kantrowitz: Legacy Companies Can Only Compete with Big Tech by Being More Human
“I think that these companies cannot compete with tech companies by being more tech. And maybe that limits their growth over time. The only way to possibly compete with big tech and to compete with AI is to be more human, right? It's to make people feel good. L…”
Brown: AI copilots will increase employer demands and eventually replace workers
“My point is the expectations on the part of our employers are just going to go up as we become more tech enabled. So we're doing more, not necessarily being paid more. And many of us are going to reach the point where the quote unquote co-pilot actually should…”
Brown: AI automation will disadvantage workers who prefer rote tasks
“The thing is, not everybody is a creative. Not everybody wants to do something other than rote tasks. There are a lot of people who find comfort in that type of work, and that's what they want to do, and they're not suited for a world where they get half their…”
Brown: 10 Startups Are Building AI Note-Taking for Financial Advisors
“There are now 10 different companies in, and then on top of which these are startups, but then on top of which you're getting offerings from zoom and Salesforce and big existing enterprise software companies, but there are 10 different companies specifically b…”
Brown: AI tools will hollow out entry-level financial advisor apprenticeships
“When I don't need that person, who's probably a 24 year old getting, I don't know, 85,000 in their first year, when I don't need that person, and none of the other firms need that person, and that goes on for five years, you've kind of hollowed out the way tha…”
Kantrowitz: Generative AI Will Eliminate Doctors' Manual Paperwork
“No doctor is going to have to do that again, because this is all going to be generative AI. The doctors will simply check the output and the list goes on in every single profession.”
Brown: Companies Will Become Fabulously Profitable by Automating Busywork
“Yes, companies are going to become fabulously profitable as they institute all this amazing technology that's coming down the pike, and it's already happening, and of course, we're gonna get rid of a lot of busy work that people should not be doing anymore if …”
Brown: Capitalism collapses unless the middle class is forced to work
“The reason capitalism works is you have people at the top of the heap that have already made it, probably because they killed themselves to get there, and then you have people who want to be where they are and are willing to do the jobs that are necessary in o…”
Brown: The Fed sought a recession to push people back to work
“They never said it, but that was the explicit policy aim. We need to crash this economy to get people back to their jobs. It's crazy. I mean, it didn't work. They weren't able to do it, thank God. We got inflation down anyway despite their efforts”
Brown: Sweetgreen automated machine makes 500 to 800 salads hourly
“They have a machine in there that makes between 508 hundred salads an hour.”
Brown: Services-driven economy is less vulnerable to high interest rates
“Services driven economy. It's going to be less susceptible to higher interest rates. It's not part of the manufacturing cycle of booms and busts and inventories and, okay, so there's that.”
Brown: Fed will probably cut interest rates again in weeks
“The Fed has done its first interest rate cut, and they started off with a double cut, and they'll probably do another one in a couple weeks”
Brown: 2024 election will likely yield divided government, boosting stocks
“It looks like actually the outcome's gonna be still up in the air, but probably lead to a divided government, which is positive for stocks, historically where no one party gets to do a lot of Weird shit in either direction.”
Brown: 401(k) Plans Hold $11 Trillion with Bi-Weekly Automated Inflows
“By the way four one K is 11 trillion dollars, ok? People are adding to that 11 trillion dollars every two weeks when they get paid.”
Brown: Automated 401(k) flows and rebalancing drastically dampen stock market volatility
“The effect of these forces that I'm describing is a dampening of volatility, and it is a acceleration of the correction process. So it's not that we don't have corrections we do, all the time. They don't last long, because the wealth manager, with fifty billio…”
Brown: Warren Buffett Uses the Yen Carry Trade for Japanese Equities
“Warren Buffett is involved in the yen carry trade. He sold bonds, denominated in yen, and used that to fund the purchase of Japanese equities.”