Warsh’s focus is on productivity in the real economy.

Rather depends on how he defines "productivity". As GDP per human labor hour, or as GDP per Bazillions of invested capital. If it's per human labor hour, the narrative of AI systems replacing millions of "knowledge workers", would be great for productivity. If per Bazillion of invested capital, not so much.

President Trump appointed Warsh largely because Warsh agreed to reduce the fed funds rate with the rationale of increased productivity.

Cheaper capital promotes greater use of leverage to juice corporate profits. It works, until it doesn't. We discussed this when I was in B-school 50 years ago.

The model of power- and water-sucking data centers that burden locals with costs while funneling any profits to the few owners is causing massive blow-back leading to localities banning data centers. NIMBY on steroids with good reason. Far more than the data build-out in 1999 ever did.

The "news" has been carrying clips of several speakers at college commencements praising AI, to a chorus of boos from the students, who have shouldered five figure debts to become the "knowledge workers" that AI is most likely to replace.

Meanwhile, where are the Proles? On Friday, the "news" reported over 60% of respondents said the economy is bad, but record numbers of those same people are planning trips over this holiday weekend, as if they were not under any financial stress at all. Seems the economy will continue to float on a rising tide of debt, as it has since the 80s.

Steve