AI Boom's 16K Job Shadow

Hello, everyone, and welcome to The beginning of empathy. I am your Empathy Keeper.

Looking at the global news from the past day, we are left with a strange feeling, as if two entirely different worlds coexist. On one side, artificial intelligence and semiconductor giants are reporting record profits, driving stock markets to new highs, while the price of gold continuously breaks records, reflecting deep-seated anxiety. Yet, on the other side, we see massive layoffs, profound livelihood insecurity, and subtle cracks appearing in the global financial system. In this stark contrast, what should we empathize with, and what future should we prepare for?

Part 1: Financial Market Polarization: The Crossroads of Fear and Euphoria

The most defining characteristic of yesterday's global economic news was extreme polarization. Financial markets, in particular, showed a simultaneous rush toward risk aversion and an overheating centered on technology stocks.

Consider Argentina's perpetual dilemma: foreign exchange instability. News broke of intervention by the US Treasury aimed at curbing the sharp rise in the dollar's value there. This once again highlighted Argentina's chronic foreign exchange instability. Analysts even drew comparisons to the 'blind financial support' promised during the 2001 financial crisis, raising criticisms that temporary external aid cannot solve fundamental economic policy failures. The anxiety felt by Argentinian citizens regarding currency devaluation and soaring inflation is not just an economic metric; it is a matter of survival.

Across the Atlantic, European markets were shaken by the disclosure of credit issues among US regional banks. Stock prices of major European banks in Germany, Italy, and the Netherlands all declined, bringing back concerns about the financial system's fragility that had been dormant since the 2023 regional banking crisis. This clearly demonstrates the interconnectedness of the global financial system, showing how one nation's credit problems can impact worldwide investor sentiment. Investors flocked to safe-haven assets, pushing the price of gold past ,300, setting an all-time record. This is a symbolic indicator of just how deep the market's anxiety runs.

Then there is the painful reality in Australia, where people are increasingly withdrawing their retirement funds, known as Superannuation, early to cover medical expenses. In the last fiscal year alone, .37 billion was withdrawn for medical purposes, largely due to the high cost of essential services like dental care. The reality of Australian citizens having to use money saved for their retirement to solve immediate health problems represents the suffering of ordinary people in areas where the welfare system falls short. It is a sad reflection of the dilemma between economic stability and the right to health.

Part 2: The Light and Shadow of Tech Innovation: AI and the Financial Edge

In the technology sector, AI is bringing both innovation and new forms of risk.

Taiwan's TSMC reported overwhelming third-quarter results, showing over 30% year-over-year revenue growth and nearly 39% net profit increase, confirming the explosive demand for AI semiconductors. South Korea's Samsung Electronics and SK Hynix also saw their stock prices hit all-time highs, continuing the semiconductor boom. This AI-driven innovation is generating immense wealth for a select few companies.

However, market volatility is also increasing. Renewed trade tensions between the US and a major Asian power caused the market fear index, the VIX, to spike. Furthermore, some foreign media raised concerns about 'P/E ratio overheating' regarding the stock of memory chip maker Micron. The faster the innovation, the greater the market instability seems to be.

Amidst this, streaming service Spotify announced a collaboration with major record labels—including Sony Music Group, Universal Music Group, and Warner Music Group—to develop 'responsible AI' products. This move aims to address copyright and fair compensation issues arising from AI-generated content. Spotify emphasized that AI should not replace the artist's creativity but should instead be a tool for generating new revenue streams and deepening connections with fans. This raises a crucial empathetic question about how technological progress should respect human labor and creative activity.

Finally, a staggering error occurred in the US: PayPal's blockchain partner, Paxos, accidentally issued stablecoins worth 00 trillion—more than twice the world's GDP—due to a technical glitch, only to burn them minutes later. While customer funds were unaffected, this incident raises fundamental questions about the stability of digital financial systems. It shows the potential risk a single technical error, no matter how innovative the technology, poses to the global financial structure, underscoring the vital importance of regulation and safety mechanisms.

Part 3: The Corporate Efficiency Blade: Sacrificing People and Communities

The most heartbreaking news concerned the massive workforce reductions and community losses resulting from corporate efficiency drives.

Nestlé, the global food giant headquartered in Switzerland, announced that its new CEO plans to lay off 16,000 employees worldwide over the next two years. The CEO declared an intention to establish a 'ruthlessly performance-driven culture.' Immediately following this announcement, Nestlé's stock price surged by over 9%. While this may be welcomed by shareholders, it exposes the harsh reality of corporations sacrificing the livelihoods of countless employees for short-term stock gains. Concerns about the scale of these layoffs are particularly high in Spain.

This trend extends to community symbols. In Poland, the historic Namysłów brewery, which has operated since 1321, announced it would cease production, resulting in 88 job losses. The owner, the Żywiec Group (part of the Heineken family), cited a slump in the beer market and rising costs. The disappearance of a company with centuries of history, a symbol of the local community, represents a cultural loss far beyond mere economic damage. Similarly, in France, the 300-year-old Teisseire syrup factory is closing, eliminating 200 jobs. We must empathize with the profound impact global corporate restructuring has on local economies and people's lives.

Empathy Keeper's Insight: The Shadow Behind the Performance

The common thread running through yesterday's news is that the stability of individuals and local communities is being sacrificed in the name of 'growth and efficiency.' AI and semiconductors are growing at an incredible pace, but the fruits of this growth are concentrated in the hands of a few, while the majority struggle with job insecurity and high living costs. Corporations execute massive restructuring to boost stock prices, which can ultimately lead to weakened consumer confidence and social instability. Argentina's currency crisis, Australia's healthcare dilemma, and Europe's banking jitters are all fragments of this massive economic imbalance.

Predicting future economic changes, AI and technological innovation will continue to dominate the market. However, the resulting wealth concentration and labor market instability will exert strong social pressure on governments and corporations to pursue 'inclusive growth' and 'responsible innovation.' As seen with Spotify's AI copyright collaboration or the regulatory compliance efforts of some tech firms, technology companies can no longer simply prioritize speed; they must fulfill their ethical and social responsibilities to achieve sustainable growth.

Today, we shared stories of global economic disparity and the suffering of those caught in the middle. We deeply empathize with the news of 16,000 layoffs hidden behind dazzling stock market surges, and the reality of people having to use their retirement savings just to pay hospital bills. As we discussed in previous posts, these individual news items are all interconnected. It is time for all of us to understand the complex flow of the world and seek better ways for coexistence.

Your Empathy Keeper will continue to unravel these complex global stories through the lens of empathy. What are your thoughts, dear readers? Please share your opinions in the comments below.

Until the next update, thank you.