The Price Of Knowledge Is Going Towards Zero

Core PPI rose 0.8%, beating forecasts and raising new inflation concerns. In this episode, Neil and Eric break down what higher wholesale prices mean for interest rates, the 10 year Treasury, and stagflation fears. They also cover AI driven layoffs, the falling cost of knowledge work, and why AI agents are becoming a powerful new distribution channel. From MCP infrastructure to human oversight and API cost savings, this episode shares practical insights for staying competitive in uncertain economic times. Key Takeaways: • Core PPI jump signals inflation pressure • AI agents becoming new distribution channel • Curiosity compounds in chaotic markets Chapters: (00:00) Core PPI Surge Explained (00:22) Interest Rates and Stagflation (01:30) Wholesale Inflation Breakdown (02:28) AI Layoffs and Knowledge Work (04:23) AI SEO and ClickFlow (05:24) AI Agents as Distribution (10:20) Managing Agent Quality Control (14:00) Smart AI Cost Optimization

• 0:00Speaker 00

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• 0:34Speaker 01

  Did you see how core wholesale prices rose like crazy?

• 0:38Speaker 00

  What did?

• 0:39Speaker 01

  Core wholesale prices?

• 0:41Speaker 00

  No, I didn't.

• 0:42Speaker 01

  So core PPI, which excludes volatile food and energy prices, increases seasonally adjusted 0.8%. More than the 0.6% gain in December and well ahead of the Dow Jones consensus estimate of 0.3%.

• 0:56Speaker 00

  Are we cutting interest rates?

• 0:57Speaker 01

  Uh, the 10-year went down, so usually if the 10-year goes down, that means they believe the rates are gonna start going down. But they're worried about stagflation at this point.

• 1:06Speaker 00

  Yeah, I mean, the world's crazy right now. But honestly, like, okay, we can say that, right? But honestly, like, we should just say, okay, the world's crazy right now, like, here's what we would do about it. So here's what at least I would do about it. I only think there's one way through it, like, if you're curious and you're actually out there, you're curious, you're learning, experimenting, and you're actually even, a bonus would be if you're out there teaching, you will be unstoppable now, no matter what. I think all the stuff that people are talking about, oh, there's AI, there's layoffs right now. All you can worry about is yourself and the only way out is through. So I'm looking over a hill right now, there's a hill over there, okay? So there's this giant tidal wave coming over that hill right now. And you can choose to surf that wave, or you can choose to like not do anything and just stare at it and just get hit by it, right? But I would say the more curious you are, the more entrepreneur you are.

• 1:51Speaker 00

  You don't have to be an entrepreneur, you can be like an intrapreneur. You're gonna do just fine and you're gonna surf this wave. And that's why during this period of chaos right now, as the world adapts, I think there's gonna be some job displacement, but I think in that net, long-term, we're gonna be okay.

• 2:04Speaker 01

  Yeah, and when you look at like the overall wholesale prices, which is just another version of inflation. Anyone who's not sure what I mean by core wholesale prices, think of a business buying a product that they are going to resell to someone else. So you're buying, you know, I'm Best Buy, which is electronics company if you don't live in the US.

• 2:24Speaker 00

  Wow.

• 2:24Speaker 01

  And they go buy a TV from Sony and then they go and sell it to end consumer, right? So they get a wholesale price. They don't pay the sticker price for a Sony TV. If they did, there would be no margin, no profit for them. And on an annual basis, uh, core wholesale prices accelerated 3.6%. Now, is that some of that caused from tariffs and other stuff? I don't know, but you know, the market didn't like it.

• 2:49Speaker 00

  You know, we should, we should talk about this because I actually have a tweet that's related to this. So, um, we're talking about, you know, inflation, we're talking about stack. Actually, no, we're talking about stagflation, which is actually you have no growth plus inflation. Really bad. Okay. Stagflation is terrible. Now, I, we're, we're talking about, okay, you know, blocks doing these layoffs over here. I just pulled this up. Um, I saw this this morning as I was walking back from the gym. So this guy Jeff, um, he previously at Co2 and Goldman Sachs, so finance guy. Um, I think we actually work with this company. This is a crypto company. Yeah, we did. We, we worked with this company before, uh, Say Network. Okay. Um, so spoke with this guy Jeff says, spoke with several Y C founders, planning layoff, all engineers below staff slash principal. Basically everyone under L5.

• 3:33Speaker 00

  This only became viable after Opus 4, 5 in December. The block layoffs are a signal, the floor just collapsed. If you're early in your career, the next few years are everything. Your edge will be how well you integrate AI into the value you create. The fastest learners are about to compound at absurd rates. Maybe that's part of the reason why Neil, I, I, I'm excited for, um, you, me, our other kind of, um, you know, friends who love to learn. Uh, but like point is, you know, talking about, you're talking about, um, inflation going up and you're talking about these, these layoffs over here. So the, the headline I had for this one is the price of knowledge work is gonna, is gonna continue to trend towards zero because a lot of this stuff can, can, can do the work. Um, but the people who are able to kind of converge their roles into multiple roles, they will make a lot more money and there'll be an even more demand.

• 4:16Speaker 00

  So if you, again, if you keep compounding yourself, you keep learning your, your call secures, you're experimenting, you're eating the poo poo, you will be fine. Yep. All right. So we have um this interesting one over here, Neil, on the new distribution channel as agents. So Google, I think, recently just launched their web MCP. So Neil, when you look at um when you look at the Clickflow website or you look at the Carrot website, UberSuggest is a good example, or Answer2Public is a good example, because you have um, I think for both of those, correct me if I'm wrong here, but you have versions where they can just use it, right? And like freemium version, they can get a couple of uses, correct?

• 4:50Speaker 01

  Uh huh.

• 4:51Speaker 00

  Okay. So, or we can talk about uh booking flights on Expedia, for example, right? So if you're gonna be running these agents, whether you're using like, I know Perplexi just came out with a computer use one, you can use Claude Co-Work to do work for you and it can browse the internet. You want these agents, you want to make it very easy for them um to, you know, ideally not do web browsing, but call on MCPs and just book a flight using um, you know, whatever travel website you're using. Or call on data from um, you know, UberSuggest, or Answer2Public, or Clickflow, or Carrot, right? Or spin up ads very quickly. So um, web MCP was launched by Google, okay? And I think, what are we talking about here?

• 5:31Speaker 00

  Google, I think um Stripe also launched something, I think, called um, like to allow agents to interact with each other. So I think you're gonna have a lot more, I think you even had a post on how like a lot of traffic coming to your website now is like, what, 50% bots? Is that what it is?

• 5:44Speaker 01

  Fifty-one percent of website traffic in general are bots now.

• 5:47Speaker 00

  Yeah. So, you know, this guy Akush is just saying that um Andre Kapathi said that the new channel, the new distribution channel for software as agents, agents don't just browse your marketing site, they watch your demo video. Uh, they they don't watch your demo video, they don't click through to your onboarding flow, they call your CLI. So that's your command line interface, okay? That's like using a terminal. They hit your MCP server, they read your docs programmatically. If none of those surface areas exist, your product is invisible to them. Look at how fast this moves. MCP went from zero to ninety-seven million monthly SDK, so software development kit, uh downloads in twelve months. Ten thousand plus active servers, OpenAI, Google DeepMind, Microsoft, CloudFlare, all adopted it. By December twenty twenty-five, Anthropic donated MCP, oh, I didn't even know that, to the Linux Foundation, because the standard had already won.

• 6:32Speaker 00

  Running an MCP server is now compared to running a web server. That's the new baseline for product discovery. What do you think about this?

• 6:38Speaker 01

  Yeah. I agree.

• 6:40Speaker 00

  You're just too tired right now.

• 6:42Speaker 01

  I am tired. Dude, I'm like, not daydreaming, but I kinda am.

• 6:48Speaker 00

  I can tell you don't have it anymore. It's okay. I'll carry us through the rest of this, these thirty minutes. So, okay, I'll, I'll, I'll talk about it more. This is good. Neil, can't.

• 6:56Speaker 01

  I've been up for twenty-seven hours at this point.

• 6:59Speaker 00

  Did you, so you just landed, right?

• 7:01Speaker 01

  No, I landed a while ago, but I'm working both time zones, so it's just.

• 7:04Speaker 00

  That's on you. That's on you. Yeah, see, by the way, we should, I'll, I'll take a little, a little quick detour here. So Neil, did, did you, um, sign up for the, the peptide company I was telling you about? Literally, it's called the peptide company from our mutual friend Jacob?

• 7:18Speaker 01

  Mm-hmm.

• 7:19Speaker 00

  Yeah. So did he give you the, the sleep peptides? Pinalon, Epithaline? Are you trying them right now?

• 7:26Speaker 01

  I'm traveling. He's, he's.

• 7:27Speaker 00

  Did he bring it with you?

• 7:28Speaker 01

  No.

• 7:29Speaker 00

  Oh, that's unfortunate. Okay. So anyway, I'll give it, give this to everyone. Like, we can take a little detour here, um, and then come back to talking about, um, distribution channels. This is not health advice, by the way, um, but I, I was taking Pinalon and, um, that's, and I don't even, I'm not even sure if I'm pronouncing it correctly, but that is a peptide. And, um, basically, it, it gives me super deep sleep and, um, it leveled up my HRV, which is my, my stress level. So you want this to be higher, so to like one hundred seven, which is pretty good. Um, and it brought my heart rate down from forty-five, resting heart rate, down to forty, which is really good. Um, so all that to say, um, with people, people that are tired like Neil, uh, who, who does traveling, um, there's a lot of travel hacking that you can do, right? And, and one of my other travel hacks too, um, is to also

• 8:14Speaker 00

  not fall asleep until you're in the time zone and then fall asleep at the right times. That way you don't have jet lag. But Neil never listened to me for that one. He just kind of works both, both time zones. So that's, that's why he's dead right now.

• 8:23Speaker 01

  And you have an app that, uh, helps with it. I don't know what it's called.

• 8:27Speaker 00

  It's called, uh, it's called Time Shifter. So it tells you the right times to sleep and all that. Sometimes it's pretty brutal. It tells you to fall asleep immediately when it's like in the middle of the day. I'm like, how do you do that? Right? Um, sometimes you need special stuff for that. But, um, I'll, I'll leave that part alone. Okay. So coming back to this distribution channel piece. Okay. So eighty-five percent of enterprise are expected to have AI agents deployed. These agents need structured programmatic access. To your product, okay? They need CLI's MCP endpoints and machine readable documentation. A beautiful React dashboard is worthless to an agent trying to pull data into workflow at 3M. So the way I look at this right now is yes, think about MCPs, yes, think about building for agents. These, um, yes, also, if you want to distribute your, your repos from a marketing standpoint, put it on GitHub, right? That, that's what Corey Haynes did. He did a really good job with that.

• 9:12Speaker 00

  But at the same time, you still need a dashboard for humans. So the stuff we're building for pay for performance right now, Neil, we do have a dashboard for like the outbound emails we're sending, the outbound sales calls that we're doing, okay? That's, that's one side of things. But even internally, um, we need a dashboard to manage all of our agents. You need some type of dashboard, some type of control system to see what they're doing and how they're performing, right? And I will tell you, um, these agents are, are just continue to compound every day. And, and like even, by the way, Neil, even when I went to the gym today, I, I, I didn't realize I was running 10 different workflows. So while I was at the gym and when I was sitting next to my, my, my CTO yesterday, when we're flying back, we're, by the way, we're sitting, you know, row 26 economy. Okay. Um, it was great. So he, um, he like, as he was talking to me, he spun up a couple of different things.

• 9:57Speaker 00

  But by the time he landed, he's like, dude, I just, I just pushed something to, to GitHub that would have taken two days to do. And I got it done in the middle of our conversation. So I think frictionless growth marketing hosted by Sonia Thompson is brought to you by the HubSpot Podcast Network, the audio destination for business professionals. Frictionless growth marketing hosted by Sonia Thompson shows how modern brands grow by removing the friction in their marketing and customer experience that pushes customers away every single day, often without leaders even realizing it. Each episode delivers practical insights, real brand examples and conversations with marketing leaders, showing brands how to win with the new rules of growth, identity-driven marketing, cultural relevance, and frictionless customer experiences. Listen to frictionless growth marketing wherever you get your podcasts.

• 10:41Speaker 00

  One, you know, AI efficiency is crazy. That's one. The second one is build dashboards for your agents. The third one is, yes, you want to be looking at building discoverability. You want to make discoverability easy for agents because you're going to have a world where agents are doing a lot of the work.

• 10:53Speaker 01

  You do, but the key here is because dude, I was just in a heated debate about agents. Like, uh, uh, 24 hours, it was, uh, it's a big company. I was at their offices. I can't mention the company, but they own some of the biggest cars that we all see in Los Angeles. And in all places all over the world. So and and they own more than just cars. They really massive company.

• 11:21Speaker 00

  Yep.

• 11:22Speaker 01

  So when you think about it, we're talking about agents and deploying at mass scale. And they were just like, oh, we want to do agent for this. We want to do agent for that. And they were showing me some of the stuff that they're building. And their biggest problem wasn't the ideas. It wasn't actually even building the agents. They didn't have checks in place for how the agents were doing their work. I thought it was a smart idea to have a team continually go and build all these agents and get a lot of work done. And this group would help other departments internally. Create agents and then that way they could be more efficient. So think of it like as a centralized hub. That just helps a lot of different teams in an organization build agents. And I was like, the biggest problem here isn't the building part.

• 12:05Speaker 01

  If you're not actually checking the quality of the work, it could be costing you a lot of money. I'm like, you guys need to figure out how to put that within your processes and systems.

• 12:15Speaker 00

  Dude, that's okay. Neil, I did this like two days ago. Okay. So I've been building my my open claw has been sitting in my telegram. So it's really only been working with me. As almost like my chief of staff, you know, assistant, if you want to call it that. It has a lot of context around the business, the goals, it's hooked in with a bunch of MCPs. Okay. I added into Slack two days ago. I added into some of the private channels that we have. And people are working with it back and forth. Now they're asking questions. They're querying data. They're asking for strategies. They're asking it to build things, right? I'm like, holy crap. I'm just like, open up this, this, um, this machine. And so to Neil's point. I do think you need a human in the loop to kind of fact check and check the data as well. You need a human in the loop to continue to fine tune it. The problem is I was building all these things out of, you know, my own entertainment.

• 12:57Speaker 00

  But now it's time for me to kind of release some of my babies into the wild and and let my team work with it. Right? I'm still, I like, I, I think. There's one thing to have a personal assistant, but when you have the personal assistant that knows what you want to hit and your goals and knows how you work. And your, your team is querying data like, for example. Oh, hey, we, we created all these programmatic SEO pages around chat G P D ads a few weeks ago. How's that going right now? Give me a four week table. Boom, like literally in a couple of seconds, it spun out and everyone can see how things are going. Oh, what, what should we? Do about that. It seems like what are next steps here? Well, you know, it's not performing over here and you're not driving any conversions here. You should do this. And I'm like, oh, hey, um, as you a person over here, what do you think about this idea? And it's just happening in real time, right? Um, and it's amazing. And then I added to the sales channel too.

• 13:41Speaker 00

  Hey, how have we been doing with, with, uh, look at our gong and look at our hotspot? How have we been doing in the last 60 days or so? What trends are you seeing, right? And then if it starts to repeat something, report something wrong, the, the, it's okay, cause the salespeople jump in. But the key thing, Neil, is that now they're starting to engage with it more and they're having conversations with it and it's moving things along. That is the key. Yeah. So.

• 14:03Speaker 01

  On a side note, I just got this email. It's one of the best marketing emails I've gotten in a long time. Check this out.

• 14:10Speaker 00

  Look, I'm so boring, guys, and Neil's starting to check his email in the middle of the conversation.

• 14:13Speaker 01

  No, no, no, this is popped up. So I, I, I have a OCD where I always had to have zero inbox. I don't know why. So this is to my dev email, you know, I'm, I get forwarded all my dev stuff. Uh, when it comes to all the tech emails, so that way I can see what my team is doing without asking them what they're doing. And we use Claude, of course, but look at this subject line, reduce your Claude API costs. They're trying to send me an email that helps me save money, which would hurt them, but in the long run, it would make me more loyal to them and cause me to spend more money over time. I would use it more. Uh, so build efficiency with Claude. You're building with Claude. Now let's optimize your implementation. Here are four ways to reduce costs without sacrificing quality.

• 14:57Speaker 01

  Learn more and then they just break down a lot of different examples. I was like, that's a great marketing email. It's very rare that a company does what's beneficial for you and hurts them in the short run. And this hurts them. This would make them less money, but in the long run, it would make them more money and have a much loyal customer.

• 15:17Speaker 00

  You know what it is too, Neil? The, the subject line is really good. When it says reduce your API costs. Um, any entrepreneur that's looking at it, any finance person is looking at it's like, hell yeah, right? Dude, my API costs for Anthropic this, this, this month already is like $3,500. I'm like, oh damn. So, so I need, I need to do something about that to optimize it, but you know what's, what's Happen in the future, Neil. You might get the emails a human and say, hey, and then there's gonna be a link saying, hey, do you want me to just do it for you? And you just click it and it does it for you, right? Or the future is gonna be, it's just gonna be sent to an agent and the agent's gonna be, hey, I spotted this over here. There's a way to save costs by eighty percent or so. Would you like us to do that? And actually, my agent does that now. It's like, hey, you're spending on all these stupid costs over here. You're right. This model's too expensive. You should use this model over here. I'm like, that's good, right?

• 15:58Speaker 01

  So, yeah.

• 15:59Speaker 00

  Yeah.

• 15:59Speaker 01

  No, it's great as long as it does it accurately and good. And I think that's a problem that we face right now with AI. In which it can make recommendations, it can help you save time, it can help you save money. But in that process, it makes a lot of mistakes from what we see. But I bet if you compare Jan one twenty twenty six to Jan one twenty twenty seven, the amount of errors will drastically get reduced.

• 16:25Speaker 00

  Yeah, and by the way, the the cost per token is going to drastically reduce as well. You know what's kind of crazy to me? It's Anthropic or OpenAI, they're kind of raising for the next round, like the next training run, right? They're spending all the money, because because here's the thing. It's it's they know the price per token is gonna drop, but they know they also have to have the best model, like a very competitive model. So they're just raising for the next round, next round, next round. Like, I don't know when that's gonna stop. But it's exciting to watch from the side. And I actually, Neil, I I I've been messaging Apple. There, I've been trying to do the math on whether it makes sense to buy the Mac Studio Ultras, like the new ones that are coming out, I think, next week. And so you can buy a fully loaded one for basically ten grand. And because I want to run these models locally, right? For a lot of the things, because it's it's it's gonna be a lot cheaper, right? If you do it that way.

• 17:10Speaker 00

  Especially the work that I'm talking about doing now. So I'm like, okay, well, if I buy two of these Mac Studios running Kimi, which is a Chinese open source model locally, I'm gonna save a ton of money, like I'm gonna be making money like pretty quickly, right? But if I were to buy five of these Mac Studio Ultras, that probably would cost me fifty grand or something like that, like out the gate. And so, you know, do I want to buy it? I'm like, well, the chips. Update every like year or two years or so like the chips in two years are gonna be even crazier. Right. And so I'm like, okay, well, instead of paying the 50 grand upfront, I can pay basically eight grand to lease five of these. I'm just giving you a simple example, eight grand to lease five of five of these Mac Studio Ultras for 24 months, so two years. Okay. Are you following?

• 17:51Speaker 01

  I didn't know they have leasing programs. That's a way better deal. You're not gonna keep this stuff for five years. This can be way better tech in a year.

• 17:58Speaker 00

  Right. And so like, um, I was working with my open claw on like coming up with the maths where it's like, yeah, you should just lease these things. Cause my, my, one of our mutual friends yesterday is like, why don't you just buy it? I'm like, cause this stuff becomes outdated so quickly. And I want the latest technology running my stuff, especially if it's for our own stuff. And also if it's helping clients, because clients are gonna want stuff local, isolated to one computer.

• 18:16Speaker 01

  So yeah, I, I think leasing is smart unless it slows you down a lot. And then it's just a cost analysis. Cause to do leasing, typically you gotta fill out financial paperwork and all this kind of stuff.

• 18:26Speaker 00

  It's really easy. It's really easy.

• 18:27Speaker 01

  Okay. If it's really easy and it doesn't slow you down, but like if something was gonna slow you down a month or two, it's like, eh, I'm not saying spend the 50 grand, but maybe you go and you buy one of them for 10 grand and you lease the rest.

• 18:39Speaker 00

  That's exactly what I'm gonna do. So I'm gonna buy one for 10 grand and then the other ones, I'm probably just gonna lease. It just depends on how this scales. Like if this one, this initial pilot test goes well, like we're gonna be off into the races. Guys, thank you for joining us and we will see you, we'll see you next time.