Natalie Gallagher

Yeah, absolutely.

I mean, 2025, we saw a really intense increase in valuations.

There's a lot of hope in what AI can deliver.

We heard that at the Davos Economic Forum, also loud and clear by many key tech and political leaders as well.

Now, in order for these valuations to hold in 2026, and what we're really going to have to see, and it's going to sort of earmark the year, is a close, right, in the gap between how much is being spent on AI and the ROI that we're actually going to achieve.

If we get those productivity gains, then this is absolutely a great story of foresight.

If we don't see those productivity gains, then we're going to have a conversation much more housed around capital misallocation.

Yeah, I mean, it's fascinating, right?

What we're seeing in the overall jobs data, I'll first sort of approach that and then tell you as an economist what I'm looking at.

We look at the jobs data, there's not a whole lot of evidence that the jobs that are currently being cut is due to AI, right?

We know that that's what companies are saying.

At the same time, it's not really showing up in a clear way in the data.

On the other hand, what we do really need to see is almost a discontinuous jump in the productivity data, right?

So if we're sort of on this level increase, what we really want to see with AI is we're jumping up and then we're on a totally new level playing field.

When we see that, and there should be early adopters in some key industries, I'm thinking healthcare, consulting, finance, we should see those early signals and they should be showing up in the data.

As soon as 2026, you think?

That, I firmly believe that's going to need to happen in 2026 in order for these valuations to be deemed worthwhile.

You know, I think it's more so we're really going to have to see the ROI in a meaningful way that we can go back to.

And again, that gets back to productivity.

And the risk really is, as we sort of pull all of these levers and they get more and more complex, it becomes a much more opaque environment, right, for investors to really operate in.