AI isn’t coming for your job.

I know the headlines tell a different story, but here’s the reality 👇

 

Every major technology shift in history has disrupted the labor market. But they’ve created far more jobs long-term.

Over the last 85 years, 85% of job growth came from occupations that didn’t even exist before.

 

So, AI might change how you work. But it’s also creating entirely new industries and roles we have never seen before.

 

💡 Catch my latest chat with Charles Payne on Fox Business for more insights.

 

Transcript:

Charles: Got a lot of feedback on that private credit discussion yesterday, and it continues to make headlines. And as I said, it’s going to start being mainstream. This is today. Again, and these kind of headlines are going to cause even more panic now. Most adults remember the first time they heard about CDOs, you know, collateralized debt obligations, sort of just repackaged or packaged efforts to conceal risk back in, you know, heyday of the housing boom.

Now, I’m not saying that this is that for sure, but growth in bank loans and non-bank financial institutions has outpaced growth in commercial, industrial and real estate loans and by a large margin. Right now, private credit holds $1.7 trillion in leveraged loans to corporate sector.

But my next guest says that the private credit headlines are just, quote, “doom and gloom” when redemption gates are a common protective feature of less liquid funds.

So, let’s bring in now Evans May Wealth Managing Partner Elizabeth Evans. All right, Elizabeth, I hear what you’re saying, but why are these private equity stocks getting hammered? Someone is worried about something.

Why are private equity stocks getting hammered?

Lizzie: Well, good afternoon, Charles. I think it’s important that we bifurcate private credit as an asset class from the stocks of the alternative asset managers.

So, private credit as an asset class I’m not worried about for our investors as exposure is very minimal. You mentioned the redemption gates, the liquidity features of those funds and the lack of stress in the underlying loans. Now, that is very different from the stocks of the alternative asset managers. So, these companies, as you know, are being squeezed by a run on redemptions even if they’re only redeeming up to their cap and subscriptions.

So, some of the larger asset managers are showing 50% of the subscriptions in March of 2026 as compared to a year ago. We know that’s going to hit their profitability as those net flows are directly tied to their fees. So, you have to look at what is their exposure to private credit? What is their exposure to software?

It is not painting a rosy picture across the group as a whole, and Blue Owl in particular, 50% AUM with private credit. They’re very heavily exposed to software. So, I think you have to be very careful about owning the public companies.

Charles: Yeah, that that certainly is the proxy for all of them. It’s come down precipitously.

AI & The Labor Market Disruption: Hype or Reality?

Charles: I want to quickly ask you about another note I saw. Axios had a report out today. Economists, investors out there pitching D.C. They want a sort of a plan. A jobs loss safety net, saying America has no plan to manage the AI wipe out of jobs. But you think maybe even here, this might be more hype than reality right now?

Lizzie: I think that headlines have gotten a little bit ahead of reality.

So, what we know is that labor disruption as a result of technological innovation is not a new phenomenon. That is true. When we have these technology shocks, it does cause temporary labor displacement. Typically, we see those unemployment numbers peak 2 to 3 quarters later, and then more jobs are created and the labor market normalizes. So, what we keep reminding investors is that technology historically has always created more jobs than it’s destroyed.

It’s increased productivity, it’s increased profit margins and it’s increased earnings. And what I think is fascinating, Charles, is if we look at the last 85 years, 85% of job growth was created from occupations that didn’t even previously exist. So, I think that this headline is overblown and, we’ll see a shift. We’re seeing some softness in white collar, but a huge influx in AI infrastructure related industries and demand there.

What is your market outlook for 2026?

Charles: Let’s move to the markets. A best-case scenario for you 12 months out could be the S&P at 8,337. I got to hear what gets us there.

Lizzie: Well, Charles, this is the bottom price target on the S&P if you look at FactSet. So I would love to say we could get there. I think that that’s 26% up from where we are today.

Seems very hard for me to see how we get there in the face of sticky inflation, the current interest rate outlook and a softening labor market. But that just underscores how high the expectations are for earnings growth and Q2, Q3, and Q4. We’ve been telling clients to expect modest single-digit growth for the 2026 calendar year, which still would be incredible after the last three years we’ve had.

What’s going to take Royal Caribbean higher from here?

Charles: All right, so you gave us three ideas. We only have, we’ve run out of time. I know Ventas is one. Dick’s is another. I do want to ask you about Royal Caribbean, because this is one of these names that, you know, pops periodically and then it kind of fades and it pops periodically. What’s going to take it higher from here?

Lizzie: So, this is buying a stock on a dip, as you mentioned. So, prior to today’s news, the stock was down 13% over the last month, and that is due to the US-Iran conflict, higher oil prices, and then this possibility of a US tax crackdown. So, Royal Caribbean, of the Big Three, is the most insulated.

If you look at the fluctuation in oil prices, they’re showing that a 10% swing in oil prices will only hit earnings per share by 1.2%. So, in a world where the consumer wants their dollars to stretch further, we have higher oil prices and a lot of oil price volatility. We like Royal Caribbean the most of the three.

And I think even though it’s had great performance over the last 12 months, we still go higher from here.

Charles: All right. Love it. Hey Elizabeth, thank you very much. Always appreciate you.

Lizzie: Thank you, Charles.