David Rubenstein Warns: AI Changes Everything

Labor market shows gradual cooling

March JOLTS data reported 6.87 million job openings (in line with estimates), but the quits rate rose to 2% from 1.9% while the openings rate dipped to 4.1%, suggesting modest loosening ahead of Friday's payroll report.

Services sector remains resilient

April ISM services index registered 53.6 indicating continued expansion, with the employment component improving to 48 from March levels, while March new home sales hit 682,000 annualized, beating estimates.

Warsh would accelerate balance sheet reduction

Gary Cohn predicts potential Fed Chair Kevin Warsh would aggressively liquidate Fed assets to shrink the balance sheet rapidly while carefully managing the fine line of avoiding interest rate spikes, marking a return to monetary fundamentalism.

Fed to abandon non-core mandates

Cohn expects Warsh to eliminate climate policy and DEI discussions from Fed communications to focus strictly on monetary policy, while reducing the current 'overcommunication' style to restore Greenspan-era policy flexibility and surprise capability.

Stock drops despite blockbuster earnings

Palantir shares fell 5.5% even after quadrupling profit and posting 85% revenue growth, as investors scrutinized softer U.S. commercial bookings at 2x book-to-bill versus prior quarters' 2.5-3x ratios.

Human-in-the-loop differentiation

Analyst Mariana Perez Mora explains that Palantir differentiates from AI labs by providing essential governance infrastructure, accountability frameworks, and 'human in the loop' environments that enterprises need to extract value from AI models without generating 'AI slop.'

Infrastructure vs. application gap

While competitors offer surface automation, Palantir provides the foundational operational layer for implementing AI agents with proper roadmaps and risk management, positioning itself as essential infrastructure rather than disruptable software.

Revenue volatility expected in LLM race

Gary Cohn notes that explosive growth and intense competition in the LLM space will create significant revenue volatility as companies fight for consumer and enterprise market share, even as capital expenditures remain fixed and elevated.

IBM targets hybrid enterprise architecture

Rather than competing directly in consumer AI, IBM is positioning as the 'hybrid architect' providing the comprehensive infrastructure stack that enterprises need to safely implement AI across their operations.