Transcript

Business world predictions for 2026

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1:20 Join us at masters of scale dot com slash apply twenty six. That's mastersofscom slash apply. Twenty six. Hey everyone, Bob Safian here. Welcome to a special episode of Rapid Response. We're gonna do a slightly

1:42 different format, and for that I'm joined by someone who I have eagerly Eagerly wanted to introduce to you on the show. It's a Rapid Responses producer, my colleague and friend Alex Morris. Alex? Hey everyone. So what are we gonna do? Well, Bob, you have an article of your uh predictions for twenty twenty six running on Fast Company. We are actually going to link to it in our show notes, but for now anyway, I wanted to dig through it with you.

2:11 So you're gonna interview me, then I get to be on the hot seat. We're turning the tables. This is the first time that we've done this on the show before. And I'm curious to know what was the impetus, what was the inspiration for you to you know, even start to work on these.

2:27 You mean the predictions part of it. I I was thinking back to uh A story that I wrote as a reporter uh back in the day, let's say. I did a I did a profile of a market strategist on Wall Street, this guy named Byron Wien, who at that point worked at uh at Morgan Stanley. And He did an annual sort of Uh year predictions. You know, 10 predictions for the year ahead. Um, and it it always got a lot of attention was one thing, but sort of listening to him talk about how he thought about the predictions that like You know, some of the predictions were purposely

3:05 A a little bit outlandish because he wanted to spark Dialogue. So I I I that's the spirit that I bring to this. I I don't have a crystal ball, you know, I I'm not I'm not gonna have everything be right here, but I do hope that some of the topics you and I get to talk about and then I write about in this fast company post that sort of get people's wheels spinning about what might be possible uh in the year ahead. Well Let's get started then. All right. With your first prediction, it's interesting because NVIDIA, Microsoft, Apple all had stronger earnings reports than many sort of expected. And yet

3:42 Your first prediction is that you believe tech stocks will stall this year. How's that? Yeah. I I know, I know. And and and listen, I'm not the only one who's saying that maybe there's a there's an AI bubble. I I I realize that. Uh um, but I do feel like This is uh this is a surprise if you look at the way people are actually investing. These stocks have not gone down. They are the center of of the stock market. I don't

4:08 Presume that they may not continue to be the center of the stock market. But there is a lot of Um hope. And possibility in these AI particularly related names. Um and

4:21 The end users of AI right now, like the the average company, is not necessarily getting tremendous value out of AI. I don't Presume and to say that they won't ultimately, but the the end user of what NVIDIA is creating is not so showing a lot of value. And at some point, that's gotta be reckoned with. And so that's why I think these highly values that are valued for perfection. They may stall. That I again, it doesn't mean they're gonna crash, but uh having a lot of headroom above them seems Less likely to be.

4:58 At this point. It makes me think of when you spoke to Grand Lafontaine on the show a few months ago. The CEO of White Night, yeah. Where, you know, he was talking about how he feels pressure to work a lot with AI, even though it's not necessarily solving a customer issue for him at the moment. And I'm curious whether you feel like More broadly, this investment in AI before value is seen, how much of that is

5:26 peer pressure throughout tech. I think it's peer pressure not just Not Not just tech, but also, you know, for any company because the investment markets are so um obsessed with with the value you're getting from from AI. I mean I think the big turn for AI's impact will be when it's generating new kinds of ideas and new revenue and not just

5:49 sort of m marginal cost savings. I think what is happening a little bit right now is that companies are hoping they can generate enough cost savings from some sort of smaller implementations of AI, and then they can use that money. for more experimentation that could end up bringing more innovation. But we we haven't reached that stage yet. And and so, you know, there's a there's a lot of caution quietly, not necessarily when I'm recording with all of these CEOs. Grant was was willing to say it, but certainly more quietly, I think there's some more Uncertainty about well, what's the impact really gonna be on my bottom line on my business, certainly over the next twelve months.

6:30 And when we think about this moment of when the rubber meets the road, it kinda brings us on to your next prediction, which is that AI will be an excuse for layoffs more than A cause for them. To me, I think there's been increasing talk about how AI will dramatically change jobs for people. I think it is already doing and it will continue to. And there's a concern, a a legitimate and I think real concern that the whole structure of our labor force will be modulated based on how AI is implemented.

7:05 But I don't Really see the use cases in such high demand right now that AI is actually gonna be the cause of people losing a lot of jobs right now. But I but I do think that a lot of companies are going to do, may do layoffs, may consolidate, may try to right size their business because of changes that are going on in the economy or their sector. And you know, they'll they'll attribute that to AI because that seems like a forward looking positive thing, as opposed to being our business isn't in good shape and so we have to pull back.

7:39 It's better for them to frame it as being related to AI. I'm not saying people are lying. I'm just saying for for those of us who are watching these things as twenty twenty six unfolds, I think we have to be more Uh Thoughtful. study a little bit more each time one of these announcements comes out, you know, what's really at play here. In September, um Mark Benioff, the CEO of Salesforce, cut four thousand customer support jobs. He said that was because of AI agents. Now

8:10 You know, To me, it sounded quite early of the capabilities of AI agents to Fill that many roles. Do you believe him? Or not.

8:21 Well Here's what I'd say I you know Mark was on this show in 2024, uh, like a year ago, talking about his big investment in AI agents and why they thought they were gonna change everything. And he floated the idea of renaming the company from Salesforce to Agent Force, which he has been floating again more recently in a in an interview with Bloomberg. I don't think the uptake on uh on Salesforce's agent related products has been quite as robust as he hoped they would be. Does he maybe need to pull back on some of that? I I I like how how do you say is he lying or not if it's related to the agents? I I'm sure it's related to his agent business.

9:04 You know, there's a vested interest for him and for Salesforce in uh in making a world of agents as has talent in the future, you know, uh happen. I think that's really what the motivation is of what he's doing and the way he's talking about it. So what you're saying is we need to see the receipts from Benioff and that he should tag us on social media with the receipts and then we'll decide. The branding and the implications of what it is are are as the messages, the optics can be as as important as the practicalities.

9:45 All right, let's move on to the next prediction. You Have predicted that in twenty twenty six cyber hacks will reach crisis level. So Here's the thing, when when I have talked to Tech leaders at cybersecurity companies. Um, they are using AI quite extensively.

10:07 to amplify the products that they have, the security that they can offer. And they say they can Identify and find threats that they could never find before. Um, that it's faster, that it's quicker. And I don't take issue with that. I I totally uh I totally believe that. At the same time, I think the the quote bad actors have access to AI also. Right. And the the volume of uh of attacks and of feints that are that are underway for businesses, for each of us as individuals, the scams going on, they're they're growing exponentially. It's just gotten a lot easier and cheaper.

10:45 to do an attack. Um The So the assumption of these s cybersecurity firms is essentially my AI is better than their AI. Right, like my AI safety is better than their AI hack. And I'll I'll I'll talk about this two ways. On the one hand

11:03 Yeah, they're probably right. They're the experts. I I'm not a cybersecurity expert. So they're sure they're the experts, but not everyone can afford Or is spending on the high end You know, cybersecurity that they offer. So for smaller companies, even mid sized companies, us as individuals, W we will be more exposed because there's gonna be more stuff coming our way. The turn on that is

11:27 Well what if their AI At the at the expert level. Isn't better. than the AI of the hackers. You know, that assumption that our AI is better than their AI. What if that's not true? AI it has a has tremendous power to be used for good, but it can be used for all kinds of purposes. And I think we're gonna start to see a little bit more of that as we move through twenty twenty six.

11:50 So you're saying you know The bigger companies are always more likely, I suppose, to be at target for hacks. However, they can afford the security to withstand it better, whereas mid level and smaller companies will be left more sort of exposed and therefore Will they actually be m more of the targets, do you think?

12:11 It's also that, you know, as the cost of Um attempting a hack. And getting access to these to these AI tools goes down. Right.

12:23 It draws more people into the field of being uh a bad actor. And so while the more sophisticated folks may be like, Yeah, I'm trying to get the big dog, I'm trying to get to the big companies, you know, there are a lot more people who are like, Let me see what kind of stuff I can pick off at some smaller level. And I just think that, you know, that's what happens in the marketplace, right? Price goes down, more access comes in, more players come in, and it it usually uh adds more competition. And in in the world of competition when it comes to security, I think that that puts more smaller and mid sized businesses at more risk. Well, This kind of brings us on to uh

13:01 The next prediction, um which is electricity costs will drop. This one surprised me. Yeah, I mean th this is um Fairly speculative. I would say

13:14 But Um, is inspired by me noting the volume of media attention That is going to

13:23 Um the electricity drain that new data centers and AI is putting on the system and how it's driving up prices. Um, and and I want to say like AI does use a lot of energy and there are a lot of data centers being built, and those will draw on the the electrical resources of of of any community and any economy. But there are a lot of things that draw on the electricity needs and the energy needs of a country. I worry that this is getting oversized attention. And at the same time, I think that there are

14:01 Uh Other things in our electrical grid that are being updated that are being improved. Uh there are things that are certainly happening in the creation of new energy sources to Certainly uh President Trump wants to drill baby drill, as he was he's been saying, you know, so so there there is more supply coming in certain ways, certainly a around the world. Again, local

14:25 Electricity prices may be one thing, but I do see the possibility for uh for energy prices to be moderated uh in twenty twenty six. China has really led green energy around the world. What are the stakes of the US losing that race? Nationally, like the United States is You know, is one of the largest producers of energy

14:49 globally. And so We are self sufficient in our own energy needs, right? And on a global front, China Um needs To you know, import energy to

15:03 So th this is why they have had an incentive to build their own, you know, more renewable, more local power. Um, but they are in the process of that, as with any new endeavor. They are moving ahead faster on certain kinds of innovation. So Yeah, China's China's making strides and China can because they have a a national policy that is gear to that. And the US's national policy right now seems to be much more To emphasize the carbon base. I

15:34 Think in the long run it would be better for us to be more balanced because it seems like that's where the rest of the world is moving, Europe also. But you know, that's uh that's a decision that's being made at a at a in a different house than the one I live in. Hey listeners, Bob here. If you listen to Rapid Response on Masters of Scale, you may be missing half the show. Because every Friday we release a second rapid response exclusively in the rapid response feed. The guests and topics are just as compelling and timely from Ford CEO to NASA's administrator to the lessons from The Devil Wears Prada. It takes about 10 seconds to find, just search Rapid Response wherever you listen to podcasts and hit follow to make sure you never miss an episode. I hope to see you there.

16:29 Humans will never be more intelligent than AI. Those were great at AI and those that went out of business because they weren't. How do we build a future? That is human centered. I'm Rana El Calyubi. And on my podcast Pioneers of AI, we answer that question and so many more.

16:51 As an AI scientist, entrepreneur, and investor, I know what it takes to build AI that works for everyone. Every week, I sit down with the pioneers shaping our future, and we take you behind the scenes of the AI that's transforming our lives. Find pioneers of AI wherever you tune in. Now your next prediction, I would love to move on to as somebody who myself has moved to the US, not originally from here, your next prediction is that US immigration numbers will rise.

17:28 Now that goes against a lot of the noise that we've seen over the last year. What has inspired that? This is probably more A hope? than it is a uh you know, a prediction. And when I look at data on the American

17:45 popul the US population overall. There is broad consensus That the US Needs to have a strong border. And also needs to have Uh

17:57 An open, fluid, and defined immigration policy. In other words, not the zero immigration that the Trump administration has been talking about and pushing, but but You know, most Americans want there to be a way for people to come into the country, right? But politically, it's been hard to balance that. It's like if you say you want to have people come in, oh, then you don't want a hard a hard border. And if you say you want a hard border, oh, you can't do the other thing. And so we've we've been in this kind of dichotomy that you know, is unnecessary, right? It is possible to have a a strong border and also to be able to offer visas to People are

18:35 students who were coming into the country who we want to attract, right? Trump has an unusual opportunity to be able to bridge that That inconsistency that's been forced on us by politics because of his credibility on the immigration issue. And at the same time it would

18:56 could provide another leg for him and for his his acolytes to Continue to Keep the middle part the independents in the country voting his way. It could help defang the democrats in trying to use some of the negative repercussions of the immigration crackdown against him. Right. He could he could declare victory and move on to something that is a better, wiser, long term strategy. And I'm sure Donald Trump is listening to this right now and is saying, Bob.

19:26 That's a that's a great idea. He loves our show. He famously loves our show. You know, the the pressure though on the government Um To make a change like that. Yep.

19:39 W who does that need to come from? Do you think it's gonna be a consortium of tech companies because they need more talent from abroad, or who? I think there are pressures that are gonna be shared with the administration from businesses about talent that they're having trouble getting that they wanna get. You know, I think there there's cost that's related to the way we're doing it now that is gonna be that is gonna be shared. And and and I I hope that at some point those messages do get through because What has made America such a great place is it's been a magnet for talent. Like yourself, Alex. You're not uh you were not born here in the United States, right? And I I think that we need to be able to keep those doors open if we wanna keep America, you know, keep America great.

20:29 A major thing for people when they think about the midterms is going to be healthcare. And your next prediction is that Maha will succumb to science. What gives you that level of, I suppose, optimism? Um You know, the the Maha movement has been

20:50 To my mind, you know, anti science about the way they have uh uh attacked or or reacted to vaccines and to certain other things. Um There are studies that they are pursuing underway. And I hope as if those hold up to science as they should, that they might I don't know. Reeducate, rebalance some of the assumptions that some of the the Maha that

21:15 R FK Jr., you know, feels about uh about vaccines and some of the other things. I mean, I listen, in the long run, I do believe that The truth. Comes out? And uh that science

21:29 Done appropriately. You know, will win. And so I hope that this year is is a turning point in that. But again, this is more hopeful. than uh than practical, Alex. I just know that despite all the layoffs and despite the pullback on funding, there are a lot of people who are working really hard on continuing scientific uh investigation and continuing health research. And and I believe, I want to believe that those efforts will outweigh

21:59 the political you know, beliefs of the moment. Your next prediction. Seems to me a little bit more longer term than I imagine just this year. But it is that nuclear power will solve climate change. Talk me through this one, Bob.

22:16 Listen, we we always want a a a magic bullet to solve the uh the intractable problems, right? And climate change is certainly one of our world's most intractable problems because even as we try to um curtail our use Of of you know, of certain kind of energy and and certain kind of fuels. Um demand continues to grow as the population does and as the affluence of the of the world population goes up. And so you know, we we need a solution

22:45 Uh I we would love, I I should say, to have a solution that is not um just do more with less, but is is is giving us the abundance that certainly a lot of people have been talking about this year, right? You know, nuclear power Has a Has a bad brand. So it has not been a uh a a much used technology.

23:09 But small nuclear reactors, um, there's more momentum going in that direction and and The thing that's gotten my attention You know, we we had a conversation with someone who's in the fusion uh energy. Now fusion is different than fission, right? So for for listeners, and I I always get this confused myself, right? The the nuclear power that we uh that we are used to, whether it's nuclear weapons or nuclear power plants, that is fission that is splitting an atom. Fusion is a different technology. It's bringing uh bringing things together and releasing power. And it's it's um it's always been this kind of apocryphal like, wouldn't it be great if we could?

23:49 But there have been advances in in fusion technology, serious advances in fusion technology. My prediction really is that we're gonna look back to twenty twenty six. As the year when that technology sort of came of age, and when the seeds of the you know, a clean energy future, an abundant energy future became a reality. And and that will be fission, that will be small nuclear reactors, maybe it'll be hydrogen energy. They'll the it'll come from a variety of places, but I do Think and hope.

24:25 That uh you know that that Fusion has its moment in twenty twenty six and uh and we're able to build on that from there. You're Final prediction. Uh Yeah.

24:37 I will say started to get a rise out of me when I first read it because I'm a massive fan of football. And of course the World Cup is coming to North America this summer. And your prediction is that the USA will win the World Cup. Explain that'cause my eyebrows Raised very quickly. I hope so. Maybe Spain, maybe Argentina, but maybe England. Let me uh explain my thinking on this. Team USA will not win the World Cup. I'd like to say the team USA will win the World Cup. When I say the USA will win the World Cup, I'm really talking about the United States of America as a country, as as host of this event, that this provides an opportunity for the brand of the United States to

25:29 reassert, reestablish, you know, reinforce itself globally. Um, we've taken a lot of hits. It's been, you know, there's a lot of uncertainty overseas about what people think the United States stands for. And I do think that this global gathering provides that opportunity for the US to to remind The world and remind ourselves what makes us. Special and what

25:55 responsibilities that come with that. And I'm I'm really hopeful and looking forward to us living up to all of that as we as you know as the world gets to experience the World Cup America style. I will say, Bob, I'm skeptical. I mean, people are not very happy that the US is Americanizing parts of the World Cup by having a halftime show in the final. I just wonder how it's gonna be received. The US has uh Has not necessarily made fans feel welcome, yeah, about flying in for it. And that's, you know, a core tenor of hosting a world cup.

26:34 Yeah, I I I I mean following Cutter as as the host, you know, is Both good and bad, right? It's like oh these are the kinds of countries that get to host, you know, the World Cup uh regimes that Restrict a lot of things, right? Or you could say that in comparison You know, people will be able to experience that even

26:56 When things may feel somewhat more s restricted in the United States that there's still a level of of freedom and opportunity that that is second to none. The last thing that I wanted to ask you is, you know, you've spoken to me about this before and you've spoken about it on the show, this idea that you started a career in business journalism out of this belief that business leaders could fill the gap in doing social good and making progress around the world. And You know, this responsibility of

27:32 leaders has diminished in the last couple of years. Do you feel like this year will we see the pendulum start to swing back? Or Not really. I've always felt like, you know, business It is a vehicle for progress and and that businesses run the right way can be a vehicle for progress. And I and I've tried to build my career around encouraging businesses and business leaders to to use that mantle for for good.

28:00 In Twenty twenty six, will we see more public voicing of you know, business leaders stepping out of their lane, so to speak. I don't necessarily see that I don't necessarily think that's a bad thing, provided that within their lane, within their organization, they are living to their values and they are encouraging their people and their teams and running their business in a way that is ethical and forward looking. And I do

28:30 I do think and believe and hope that that will that that will continue to happen. Part of the reason I was drawn to business journalism as opposed to political journalism was because I thought Politics had a lot of talk. But not enough happened.

28:45 And uh whereas in business You know, it was happening all the time, and in many ways that politics followed business, not the other way around. The last year has been an aberration in that. because of the activist nature of the Trump administration. But I think in America in the long run. It will come back to being businesses being the driver and and government following. Um

29:12 And I don't think that's a bad thing necessarily. And and certainly to have it be a balance, I think, is is what's really the most healthy. Well Bob, that was so fun going through those predictions with you. Thank you so much. And hey, happy new year. Oh, to you too, and to and to all our listeners. We really appreciate it.

29:31 Rapid response is a wait what original. I'm Bob Safian. Our executive producer is Eve Tro. Our producer is Alex Morris. Associate producer is Mashimaku Tonina. Mixing and Mastering by Aaron Bastanelli. Our theme music is by Ryan Holiday.

29:57 Our head of podcasts is Le Tal Malad. For more, visit rapidresponsshow.com. Yeah.