What We Learned This Week

People are Undecided on the Economy: Inflation remained subdued in September, with a monthly rise of just 0.2% and an annual increase of 2.5%, the lowest since 2021. A few months ago, this would have been seen as great news, likely sending markets higher in relief that we were making progress against rising prices. But now, it’s a different story. Investors seem harder to please, with market reactions whipsawing as the same data is interpreted in conflicting ways. The concern now is that the economy may be slowing too much, raising fears of an impending recession. This is why softer jobs and hiring data have become such sensitive topics—these indicators signal how healthy the overall business environment is.

As recession fears grow, investors often shift focus to more stable sectors like consumer staples, sidelining growth-oriented investments. The reality is, a recession could happen—it’s part of the economic cycle, and we’ve been through many before. Importantly, this kind of slowdown is what the Federal Reserve needs to see before lowering interest rates. It feels like people have forgotten that lower rates are a response to weaker economic conditions, not just a function of time. Expecting a strong economy, rising markets, and falling rates all at once is unrealistic. Some volatility is likely, and a recession may even occur, but for those with a long-term strategy, this is just part of the process.

Apple Intelligence is Here: Apple held its highly anticipated September product reveal this week, where new product updates—especially to the iPhone lineup—take center stage. While these events typically follow a predictable pattern, showcasing improved chips and upgraded cameras, this year felt different. Apple Intelligence, the company's integrated AI platform, was front and center, signaling a shift in focus. While there were the usual hardware updates, the real emphasis was on the AI engines in the new iPhone chips, enabling a range of capabilities powered by Apple’s proprietary language models. This marks Apple's formal entry into the AI race, after a notable absence, and it’s clear they’re all-in.

Although there weren’t any groundbreaking new advancements in this launch, Apple showcased a seamless and well-integrated AI experience across devices used by over a billion people globally. Despite AI’s rise in popularity, it remains relatively niche for consumers—Apple might be the one to change that. As Siri gets smarter and AI becomes more like a virtual assistant embedded in our daily lives, this could trigger a long-term iPhone upgrade cycle and deepen users’ ties to the Apple ecosystem. Of course, there’s still a chance that AI remains a fringe technology for most people. But even if that’s the case, Apple will still look like it does today, which isn’t a bad thing at all.

Amazon Still Wants Grocery: It seems Amazon hasn’t given up on its grocery store ambitions just yet. After nearly a year on pause, Amazon has resumed opening Amazon Fresh stores across the country, signaling that the company is back in investment mode now that its broader cost-cutting efforts are complete. Amazon’s struggles in grocery are well-documented, with the company having spent the better part of a decade trying to crack the code, most notably with its 2017 acquisition of Whole Foods. Yet, none of its strategies have really gained traction. Amazon Fresh, in particular, has faced numerous challenges as the company tries to reinvent the shopping experience with technology—no easy task in an industry where consumers are deeply accustomed to traditional methods. Whole Foods hasn’t fared much better as an extension of this effort.

Investors have long been puzzled by Amazon’s pursuit of the grocery segment, one of the lowest-margin retail categories, but Amazon likely views it as a critical touchpoint for establishing deep consumer trust and loyalty—much like Walmart’s Supercenter model. There’s something about grocery that fosters a closer connection with consumers, and if Amazon can figure out how to leverage that while integrating its other services, it could be a key growth strategy for its retail business. One thing is certain: when Amazon believes in something, they’re willing to endure a lot of failures to ultimately succeed.