Wall Street Week | AI Hits Wages, USMCA Under Pressure, Colorado River Crisis

Summary

Sam Palmisano discusses AI investment discipline, hyperscaler dominance, China's open-source threat, and AI regulation risks. Torsten Slack presents early data showing AI is slowing wage growth in exposed occupations but not yet causing mass job losses, while expecting S&P 493 margins to improve. Chrystia Freeland argues the US-Canada tariff deal risks permanent harm to North American manufacturing. The program also examines Colorado River water scarcity and its economic costs.

• Sam Palmisano expects large hyperscalers to dominate AI infrastructure while smaller competitors get squeezed.
• Palmisano warns AI infrastructure investors could face a costly reset or haircut.
• Palmisano sees China's cheaper open-source AI models taking international market share outside the US.
• Torsten Slack's study finds AI-exposed occupations have weaker wage growth but no significant employment decline yet.
• Torsten Slack expects S&P 493 margins to improve as AI adoption advances.
• Diane Gersten highlights Walmart's employee-inclusive AI deployment as a positive model.
• Chrystia Freeland says permanent sector tariffs on Canada are self-mutilating and hurt US manufacturing, especially Detroit.
• Colorado River water shortages are forcing federal rationing and scarcity pricing, with desalination costly.