Prepare for Anything
The presentations at last month’s AGMA/ABMA Annual Meeting provided plenty of food for thought. In particular, the topic of artificial intelligence kept coming up. But, as always, attendees wanted to know what’s going to happen next with the economy.
Jim Meil, Principal, Industry Analysis for ACT Research, gave his usual analysis of the state of the economy, apologizing at the outset that all of his information, prepared the week before, might already be out of date (the Silicon Valley Bank failure occurred the weekend before the meeting). Meil has been presenting at the annual meeting for a number of years, and his detailed analysis—and dry sense of humor—make his presentation always well anticipated.
This year, of course, the main gist of Meil’s talk was whether or not there will be a recession, or even whether or not we’re already in one. We’re in unusual times, he said, with unprecedented low unemployment at the same time we’re experiencing rapid inflation. The Fed has never gone through a sustained period of rate hikes when the country has been at 3.5 percent unemployment, so they’re operating without a road map, Meil says. In addition, we’ve seen repeated shocks to the system over the past several years, including trade wars, COVID and the war in Ukraine, He pointed to softening of demand in things like the Purchasing Managers Report. All of this makes it pretty hard to predict what’s going to happen next. When banks start failing, and the federal government is about to reach its debt limit, it could make for a very interesting summer.
So will there be a recession or won’t there? At the end of the day, Meil shrugged his shoulders and said, probably yes, a small one, on paper. “But it will be the best recession of most of your careers.”
Overall, the mood at the event was extremely positive. Gear manufacturers and suppliers alike were enthusiastic to be together again for only the second meeting since COVID. People are definitely still celebrating the fact that we can all get together in person. From my observations and conversations, not too many were overly concerned about the economy.
The other topic that kept coming up, both in the presentations and in individual discussions, was the importance of beginning to understand artificial intelligence. Much of this has to do with the recent headlines surrounding ChatGPT and other language-learning chatbots that are becoming scary good at what they do. Mostly, people in industry are looking at this as another tool that they can use to make their businesses more efficient. If you haven’t done so, you should try it, if for no other reason than so that you know what everyone is talking about.
