TheChek News Flow

BlackRock’s Rick Rieder sees opportunity in bonds, Ray Dalio recommends caution

Trouble in the bond market is forcing investors to anticipate where the economy—and their portfolios—are headed.

The yield on the 10-year Treasury note recently surged past 5% to hit fresh 19-year highs. U.S. debt has topped a record $40 trillion. War with Iran is pushing oil prices higher. The Federal Reserve is expected to keep raising interest rates to tame inflation, suggesting mortgage and other borrowing costs won’t meaningfully ease soon.

So how will the economy handle rising rates—and what should investors do to prepare?

The Wall Street Journal asked six leading money managers for their thoughts.

Surging bond yields will weigh on the economy, and there are already signs of weakness in rate-sensitive sectors such as housing, says Dan Ivascyn, chief investment officer of Pimco, the $2.3 trillion fixed-income specialist.

But he notes that many consumers locked in low mortgage rates in recent years, shielding them from higher rates. At the same time, artificial-intelligence companies powering the U.S. economy will likely keep spending, another reason to anticipate continued growth.

“We expect some slowing,” Ivascyn says. “Just not a recession.”

If oil prices keep rising, bonds may feel more pain, he says. Longer term, though, AI investments could make the economy more efficient, keeping a lid on inflation while helping bond prices.

For now, he says investors should take advantage of the higher yields.

“You can build a 6% or 7% high-quality portfolio,” Ivascyn says, which compares favorably with a stock market trading at high valuations.

Investors are fretting about rising rates and bond yields.

Sonal Desai remains optimistic.

Corporate earnings, equity markets and economic growth have all held up well, says Desai, who oversees more than $300 billion in fixed-income at Franklin Templeton.

“I think we’re seeing a bond market re-rating, if you will, of what the U.S. economy is capable of,” Desai says. “I’m not a believer that high rates are going to crush the economy. I think we can handle it.”

Desai expects yields to continue to rise, pressuring bonds, as record government borrowing and the AI build-out compete for debt capital. She says investors who became accustomed to equity-like returns from their bond portfolios as rates fell need to reset expectations and focus on locking in “solid income.”

Desai is avoiding the longest-dated bonds, which are most vulnerable to additional Fed rate increases, but is considering purchasing bonds from AI hyperscalers, such as Microsoft, Meta Platforms, Amazon.com and Alphabet, which offer sizable yields given their investment-grade ratings.

“These are sound companies, sound balance sheets,” she says.

Rick Rieder is thrilled about the risk-reward proposition that bonds offer.

“My funds are yielding 7-plus percent with a three year duration. I’ve waited four decades for the ability to do that,” said Rieder, BlackRock’s chief investment officer for global fixed income, who oversees more than $2 trillion in assets.

Rieder says investors don’t need to take big risks to hit attractive fixed-income returns in the current environment. He is also upbeat that prices of long-term Treasurys will stabilize. In previous instances where the 10-year yield breached 5%, returns over the following 12 months were strong, he has been telling clients.

Higher yields mean that the number of investors wanting to talk about bonds is “exploding,” Rieder says, despite the losses this year.

“People recognize that once you get the 10-year above 5%, you tend to make money,” he said. “The question is whether today is the day to enter.”

Rieder thinks that the answer is a cautious “yes.” He is starting to “dabble” with adding longer-dated bonds, which would appreciate in price if government yields fall.

With U.S. borrowing showing no signs of ebbing, Ray Dalio says we are at the point where heavy debt begins to affect the overall economy.

Dalio, the founder of hedge fund Bridgewater Associates, has warned for years of the dangers of surging government debt, illustrating the potential consequences in a series of books including his latest, “How Countries Go Broke.”

The U.S. is spending more than $1 trillion annually just to pay interest on all its debt, he notes. Debt-service payments—interest expenses plus maturing debt—have begun to “squeeze out” other government expenditures, a worrisome shift that is taking place in other Western nations, as well, he says.

Global bond yields will keep climbing, Dalio predicts, as the supply of government debt overwhelms demand. That will result in an eventual slowdown in borrowing—and growth. He recommends investors build a well-diversified portfolio but stay away from interest-rate-sensitive investments.

Bryan Whalen | Chief Investment Officer of Fixed Income, TCW

Rising rates usually scare investors. They shouldn’t this time, says Bryan Whalen, chief investment officer of fixed income at TCW, which manages $200 billion.

Higher rates will pressure parts of the economy, but the biggest issuers of debt—hyperscalers spending to build AI businesses—remain profitable and maintain strong balance sheets. That will help them shrug off the spike in rates, Whalen says.

“More than half of U.S. growth is coming from interest-rate-insensitive borrowers,” he says. Even if the Fed hikes one, two or three more times, he says it won’t matter for that swath of the economy.

Investors haven’t fled from bond funds, despite this year’s losses, which Whalen views as a positive sign. And bond spreads—the extra yield demanded for riskier bonds—remain narrow, another indication the economy is holding up well.

Whalen doesn’t believe the rate-increasing cycle will last very long, partly because inflation won’t surge, despite the ongoing war and higher energy prices.

He says investors are being well-compensated for the risks of holding bonds. “The war will end and commodity prices will come down.”

Inflation tied to the war should be temporary, but Rob Arnott says the challenge is knowing when it will end.

“That’s the key question,” says Arnott, the founder and chairman of Syzygy Asset Management, formerly known as Research Affiliates. “Trump would like us to believe that it will end imminently. I hope he’s right, but I don’t see a lot of evidence that that’s correct.”

Arnott believes that AI is a transformative technology that will boost productivity, but he isn’t a fan of large-cap stocks that have surged on AI enthusiasm.

“I’m of the view that we’re looking at a bubble here,” says Arnott, who argues that a flood of money into index funds has pumped air into the bubble “in a way that was impossible in 1999 and 2000.”

Arnott sees an extreme valuation gap between companies in the S&P 500 and the next 500 largest U.S. companies. He believes smaller companies will outperform big ones in the coming years.

Warburg Pincus Makes Improved $1.5 Billion Offer for Australia’s Ingenia

The private-equity group’s latest offer is more than 10% higher than its initial proposal

• Warburg Pincus made an improved 1.50 billion U.S. dollar offer for Australia’s Ingenia Communities.
• The latest proposal is nearly 4% higher than the offer Ingenia rejected a week ago and more than 10% higher than an initial approach.
• Warburg Pincus is only interested in Ingenia if the company halts its proposed acquisition of Australia-listed home builder Peet.

SYDNEY—Warburg Pincus has made an improved US$1.50 billion offer for Australia’s Ingenia Communities INA 6.00%increase; green up pointing triangle, telling the retirement village operator that it wants full access to its books by the end of this week.

Ingenia, which owns retirement villages and holiday parks in Australia, said Monday that the New York-based private-equity group had raised its indicative all-cash offer to 5.25 Australian dollars a share, equivalent to US$3.69.

That is nearly 4% higher than the A$5.05-a-share proposal Ingenia rejected a week ago, and more than 10% higher than an initial A$4.75-a-share approach in early September.

ASX-listed Ingenia said it received the latest offer late Friday and that its board is still assessing it.

About half an hour into Monday’s trading session, Ingenia shares were up 6.8% at A$4.805.

Ingenia said the proposal is subject to several conditions, including that by Oct. 2 it agrees to the terms of full due diligence and confirms its intention to recommend the proposal.

“The board has not yet formed a view on the merits of the further revised indicative proposal, including the acceptability of the conditions,” Ingenia said in a market filing.

Warburg Pincus, which has more than US$10.0 billion invested in Asia-Pacific real-estate platforms and ventures, reiterated that it is only interested in Ingenia if the company halts its proposed acquisition of Australia-listed home builder Peet.

Warburg Pincus already has exposure to Asia-Pacific retirement living through a joint venture with South Korean developer SK D&D.

Seeding the venture in 2025 with three high-quality, strategically located assets in Seoul, the venture is designed to cater to the country’s rapidly growing elderly population.

See How the U.S. Is Attacking China’s Control of Critical Minerals

A Trump administration initiative to create a China-free supply chain for military and industrial inputs is starting to work

The Trump administration is engaged in a multibillion-dollar, governmentwide effort to loosen Beijing’s chokehold on critical minerals. It is slowly starting to work.

The effort to develop a China-free supply chain for vital manufacturing inputs moved into high gear after April 2025, when China put export controls on key rare-earth elements. The U.S. push for mineral independence has spanned the departments of Defense, Energy, State, Commerce and Interior, as well as new offices and two government banks, much of it coordinated by the White House National Security Council.

It represents one of the most comprehensive, sustained and focused efforts by the second Trump administration to onshore an essential U.S. supply chain, say current and former government officials and mineral experts. As China’s restrictions riled up U.S. manufacturers, the Trump administration almost immediately began pushing hundreds of millions of dollars into domestic minerals projects.

Critical minerals are crucial to the manufacturing of defense, transportation, energy and computer systems; they underpin AI and weapons development. By the time China imposed its rare-earths export controls, President Trump had already declared the lack of a domestic supply a national emergency.

Before the mid-1990s, the U.S. was a global leader in rare-earths production. “It took us 30 to 35 years to lose industrial capacity,” said Tomasz Nadrowski, author of “Mineral War: China’s Quest for Weapons of Mineral Destruction.”

And it will be at least a decadelong effort to escape China’s chokehold, experts say. Senior Trump officials discussed rare-earths exports with their China counterparts ahead of the Chinese leader Xi Jinping’s recent visit to Washington, and China agreed to extend until January a truce to provide minerals to the U.S.

A White House official said the administration has completed more than 180 critical-minerals-related projects since Trump took office for the second time. Projects still have to go through due diligence and meet conditions to get the money, the official said.

U.S. government nonequity investment in rare-earths and magnet projects grew to $7.6 billion in the 18 months ended June 2026, more than four times the amount between 2020 and 2024, according to an analysis from the Center for Strategic and International Studies.

The administration has encouraged private investors to join the minerals boom. Among them, the president’s sons, Eric Trump and Donald Trump Jr., have deals with companies that the administration has backed.

Other nations targeted by China’s export controls, such as Japan, are also taking steps to erode Beijing’s dominance. But the U.S. has done perhaps the most to scramble the global order, industry experts say, striking more than two dozen agreements with countries for mineral development. In addition, a new State Department-led initiative called Pax Silica coordinates minerals production with U.S. allies such as Greece and Israel.

By next year, U.S. defense contractors will be required to eliminate from their supply chain certain metals sourced from adversary countries including China, a requirement that many contractors say isn’t feasible despite the progress being made. Some Pentagon officials say they are aiming for a “closed loop” of U.S. and allied supply chains for some minerals by 2030.

A Pentagon spokesperson declined to comment on specific transactions, but said the department’s “priority is securing the end-to-end supply chain for minerals critical to national security.”

In April, Deputy U.S. Trade Representative Rick Switzer said that with help from Japan and Europe, the U.S. has the capacity to develop an end-to-end critical-minerals supply chain free of China within six to 12 months, if the country were pressed to do so.

Recent projections from CRU, a London-based commodities-data provider, show China losing market share by the end of the decade in many of the elements and minerals it had most tightly controlled.

Republicans worry Make America Healthy Again is an electoral liability while activists claim it has abandoned its values

Divisions within Robert F Kennedy Jr’s Make America Healthy Again movement risk damaging Republicans just as Maha prepares to test its political power for the first time at the midterm elections.

Grassroots supporters say the group they founded has been hijacked by corporate interests, while mainstream Republicans worry Maha’s anti-vaccination message could endanger the party’s candidates in close races.

The fight has burst into the open ahead of Maha’s health conference in Washington on September 29, in which nine public companies are scheduled to speak — more than double the number from last year — along with Trump administration officials. Corporate speakers also include artificial intelligence companies OpenAI and Anthropic, which are pursuing trillion-dollar public listings, and insurance company UnitedHealth.

Some have expressed shock that Maha, which includes tax-exempt organisations as well as a political fundraising arm, requested up to $300,000 from corporate sponsors to speak on a panel and attend private gatherings with administration officials.

“That’s not Maha,” said Kelly Ryerson, a Kennedy devotee and co-founder of a regenerative agriculture non-profit. “Some of these things creeping in feel like classic lobbying and co-opting of a very popular movement. That’s frustrating.”

Maha loyalists complain that the grassroots movement has become increasingly hijacked by outside groups.

“The biohacker bros have pretty much moved on into the Maha movement,” said Zen Honeycutt, a Maha loyalist and head of the non-profit Moms Across America, which advocates against pesticides and genetically modified crops.

“The real mothers movement that created all of this, they do not use Neuralink and Crispr and GLP-1s and peptides and all kinds of biohacking things,” she said. “There is a very different type of person who has been the backbone of this movement and that is the mothers who have been using natural remedies.”

Maha began as a grassroots health crusade led by Kennedy focused on wellness and scepticism of vaccines, ultra-processed foods and the alleged corruption of the public health system by corporate interests. But it became an official government policy initiative when Kennedy — after abandoning his independent presidential run in 2024 and endorsing Donald Trump — was appointed health secretary by the president.

Now it is raising campaign contributions and rolling out cash to preferred candidates across the country, all Republicans. Kennedy, who according to Pew Research is the most popular secretary in Trump’s cabinet, has travelled to battleground states to campaign for the party.

However, the rhetoric that started a popular movement poses problems for Republican candidates, and few have embraced Kennedy as a campaign speaker as they fight a resurgent Democratic Party.

“If he is casting doubt about the efficacy of vaccines and insinuating that vaccines cause diseases, then he is a total loss for Republicans,” said Republican pollster Whit Ayres.

The overwhelming majority of Americans believe vaccines have eliminated “utterly horrible diseases” such as polio and measles, he said. When he cast doubt on vaccines, Kennedy put “Republican candidates in a very uncomfortable position”.

Of all the election contests in November, the Iowa governor’s race is considered the most high-profile test of Maha’s political power. If Republican Zach Lahn wins, Maha could have long-term viability when Trump and Kennedy are out of office, Republicans have said privately. In August, Kennedy campaigned with Lahn in Iowa and he is listed as a speaker at Tuesday’s Maha event. Last Monday, Maha said it was giving $1mn in funding to Lahn’s campaign.

One of Lahn’s top campaign issues has been confronting “the cancer crisis” in his state and he has called for clean water reforms. Iowa has the highest incidence rate of non-Hodgkin’s lymphoma and leukaemia in the country on an age-adjusted basis, according to a February report from the University of Iowa. 

Non-Hodgkin’s lymphoma has been linked to the weedkiller glyphosate, and Bayer — owner of Monsanto which makes the herbicide Roundup — has offered a $7.25bn settlement to resolve future claims by people who allege their cancer was caused by it.

“Nobody has been a bigger warrior for clean water than Bobby Kennedy Jr,” he said at the August campaign event. Lahn’s campaign did not respond to requests for an interview.

But Kennedy’s advocacy against herbicides failed to win over Trump, one of a string of setbacks for Maha this year that have come from the president himself.

In February, Trump signed an executive order promoting glyphosate as essential to the US agriculture economy. Kennedy supported the executive order, saying it protected an essential farming component. 

Kennedy’s 2025 Maha report cited Bayer, Syngenta and BASF as funding favourable scientific research and spending millions on government lobbying over the issue. Kennedy’s apparent backtracking on glyphosate triggered a significant rift with members of his Maha community.

“It was an enormous blow,” Ryerson said, a Maha advocate who has known Kennedy since he was a trial attorney working on glyphosate litigation. A lot of Maha people “disengaged” after that executive order, she said.

“Each time we get a little bit of progress, industry quickly steps in and shuts it down,” she said. “I still am looking to Trump to take the leadership that he promised on pesticides on the stage when he combined forces with Bobby Kennedy.”

Ryerson and other Maha loyalists applauded a September 22 announcement that HHS would collaborate with the Environmental Protection Agency on glyphosate oversight.

As secretary of the Health and Human Services department, Kennedy controls a sprawling organisation with a budget of $1.7tn and 13 divisions, from the US drug regulator to the Centers for Disease Control and Prevention. Kennedy and his allies lobbied Trump to nominate Johns Hopkins surgeon Marty Makary to be head of the Food and Drug Administration.

Earlier this year, Makary and Kennedy fell foul of Trump on flavoured e-cigarettes. In 2025, they raised concerns about flavoured vaping imports from China at an event with then attorney-general Pam Bondi.

“Parents watch their kids sucking on these things, they assume they are OK, they don’t understand the addictive nature of it,” Kennedy said. 

But in May, Trump strong-armed the FDA into approving mango- and blueberry-flavoured vapes popular with children. Days later, Makary stepped down as FDA commissioner in part as a result of the White House’s pressure on vapes.

Kennedy has also suffered defeats on vaccines, an issue on which he has long been a strident sceptic. Maha has railed against “messenger RNA,” the technology that powers biotech Moderna’s vaccines. In February, the FDA initially rejected Moderna’s testing for an mRNA flu vaccine. A week later, it reversed itself and allowed Moderna’s flu vaccine trial to proceed.

It is not clear what prompted the FDA’s reversal but Makary was summoned to the White House days after the agency’s initial rejection of Moderna’s trial. The Boston-based biotech’s shares have surged more than 500 per cent this year.

An HHS spokesperson said government speakers were not involved in the planning or sponsorship for the Maha summit and were not aware of the corporate sponsorship arrangements.

“HHS has turned Maha into action across food and nutrition, vaccine safety, research, environmental health, behavioural health and addiction, physical activity, rural health and chronic disease prevention,” HHS spokesperson Emily Hilliard said.

The tax-exempt Maha organisation running the conference said on its website that it did not co-ordinate with the government on sponsorship or planning the event.

Kennedy has scored victories this year, especially in elevating fringe medicines historically shunned by big pharmaceutical companies. In April, shares of psychedelics companies soared after Trump signed an executive order to increase access to these experimental drugs. Kennedy has also promoted the health benefits of unregulated peptides, and an FDA panel in July voted to broaden access for these drugs despite the agency’s own objections.

Still, these regulatory wins for psychedelics and peptides businesses underscore what some see as an overly cosy relationship between Kennedy’s Maha organisation and government rulemaking.

Both psychedelics and peptides businesses participated in the first Maha summit in November 2025 and have also sponsored Tuesday’s event. Kennedy’s son, Finn, spoke at the event last year, and he is now raising money to invest in various Maha-aligned businesses.

Amid the increasing corporate interactions with Maha, its diehard vaccine sceptics said they felt abandoned by the movement despite close ties with Kennedy personally.

“The medical freedom people who have been up in arms about the pandemic are not part of all this administration Maha effort at all,” said Mary Talley Bowden, a Houston-based doctor. “They are not including our issues in Maha.”

She said Maha had been “hijacked” by Calley Means, a former lobbyist who became a senior adviser at HHS. Means first introduced Kennedy to Trump and has steered Maha on food issues. Means is scheduled to speak on Tuesday.

The HHS said Means was “a relentless advocate for all of the secretary’s priorities”.

“Irrelevant outside attacks will not derail our work or diminish the historic progress HHS is delivering to Make America Healthy Again,” an HHS spokesperson said.

Bowden said food was not a priority when Kennedy started as secretary.

“We were all buzzing about the pandemic and the Covid shots,” she said. “We were all fired up about that. No one was fired up about food.”

At an event for brand partners that Zalando, one of Europe's largest online fashion retailers, holds annually, company insiders explained how they are using AI today to save money, create content and analyze customer data. They also talked about what AI can't do yet in the fashion sector, and what it might never do.

German online fashion retailing giant Zalando last week held its annual “Partner Day,” an event at which senior managers from the world’s biggest brands come to hear about the latest developments in online shopping and platform technology.

Zalando has held the event since 2014 and this year about 750 people attended talks and workshops in Berlin. Attendees included representatives from a variety of fashion brands, from Adidas, Calvin Klein, Levis, Lagerfeld, Lacoste and Guess to New Balance, Nike, Next and Triumph.

Given Zalando is one of Europe’s largest online fashion retailers, it was perhaps not surprising that the present and future use of artificial intelligence, or AI, was a major topic at the event.

“AI is changing everything we do,” Zalando cofounder David Schneider proclaimed from the main stage at the start of the event. “The rise of mobile [technology] changed customer behavior…the rise of AI is much deeper, a fundamental change.”

“Does AI help create awareness for my online shop? Does AI help me convert traffic into orders?” Tarek Müller, managing director at About You, the German online fashion retailer that Zalando acquired in July 2025, asked in his opening remarks. “Does it help me to get more efficient and improve margins?”

The answers to those all-important questions are not all affirmative.

Müller explained that right now, commonly used AI applications like ChatGPT by Open AI or Claude by Anthropic — also known as large language models or LLMS — send less than 0.5 percent of traffic to online fashion stores. Google and Meta, the owner of Facebook and Instagram, are still the main drivers of traffic for online fashion, Müller said.

But there is another area where AI has already made a serious difference and where it is boosting sales and improving margins — content production, for both product detail pages and for more complex marketing campaigns and materials.

Zalando and About You have both almost completely eliminated the dedicated studios they previously ran to produce content and catalogue-style product pictures.

“Around 70 percent of what you see behind me was created with AI,” Matthias Haase, Zalando’s vice president for content solutions, said in another seminar, gesturing at the room-sized video panel behind him. It was covered in colorful pictures, some moving, others still. Among the only areas AI isn’t used is on content featuring real-life talent such as Zalando brand ambassador, actress Lily Collins, Haase noted. Collins was also in Berlin for the partner day event.

There’s going to be a lot more AI-created lifestyle content coming, too, James Rothwell, the firm’s senior vice president for marketing and content, told the audience during his keynote address in which he explained how advertising and marketing had changed. “Eighteen months ago, Zalando was not a content publisher,” Rothwell said. But, thanks to AI, Zalando has been moving away from traditional advertising and into things like making its own short films.

Using generative AI to present products instead of actually photographing them has reduced spend on that by around 90 percent, Müller said. About You used to spend around 7 million euros on this budget line and AI has saved it around 6 million euros, he told attendees.

About You had been working with AI-generated model and product shots for about 18 months but it was only about six months ago that the “real breakthrough” came, Müller stated.

That breakthrough meant that AI wasn’t just reducing costs but also increasing the platform’s conversion rate.

Müller explained why. A brand might find a fashion model that really worked with their products, that consumers related to, who made them want to buy more, he recounted. “But then they move to Milan and you can’t book them again,” he argued. “Or the stylist has a bad day, or certain products are not available. It’s very hard to replicate what works. But AI is learning what works — and it can replicate it.”

About You is also home to Scayle, dedicated software for e-commerce, and Scayle Studio, which uses AI for content creation.

Scayle Studio offers brands a variety of AI-generated models of all ages — although admittedly quite a few do look like different generations of one very beautiful family with dark eyebrows and big lips. These models have poses like “open laugh” or “confident cool.” Styling options, like shoes and sunglasses, can be added as well as lifelike backgrounds; the models will then move around in the garment in a video.

One garment or look can be shown in dozens of pictures and the AI will decide what works best and how to present this. How the advanced algorithms make that decision can be based on A-B testing by its owners but it’s also increasingly based on fine-grained data gathered from shoppers, something Zalando has been doing for 18 years.

Müller points out that they already know some looks, styling or even poses work better in certain marketplaces than others.

“It’s a very individual thing. It’s the same for styling, it really depends on who and what you are,” Müller told WWD during an interview. And this will become part of how AI is used to increasingly personalize what each customer sees, he noted.

“The algorithm becomes much better in recommending you things but also in recommending them to you in a way that is personalized. So it might recommend me a product I like, but also styled in a way I like it, or even styled on me, or maybe a model I relate to.”

Zalando has also been able to use this kind of AI-fueled content creation to react more quickly to trends and seasonal events, Haase told WWD. Previously Zalando would shoot a product once. “And then it stays there until it’s sold out,” he said.

Now Haase gets a special report every morning around 7 a.m., compiled by an AI agent that’s been crawling social media for what’s popular or trending. “They pull the five most relevant of what we call ‘micro-trends,'” he explained.

The AI agents will also predict the potential life cycle of the trend — that is, whether it will last longer or be gone by tomorrow. Haase’s team also checks if Zalando customers might be searching for the trend, as a way of validating the agents’ information.

Haase namechecks the most recent Met Gala in New York as an example. After picking up on the trend for “arty fashion,” Zalando launched a marketing campaign the day after the gala, which resulted in a consequential uptick in wish lists and followers for relevant brands.

Zalando already had a fast turnaround on campaigns, Haase noted, somewhere between six to eight weeks for the fastest. “But even six to eight weeks is too long to grab a micro trend.”

The use of AI to replace live models and catalogue photographers obviously has an impact on human resources. Haase addressed this, saying that of the 90 positions that were lost when Zalando’s product studio was closed, around 60 people were able to be relocated elsewhere in the company.

And human creativity does remain important, he argued: “Maybe [what the AI selects] fits the trend, it fits the style but it just doesn’t look good. That’s where the human comes in and says, ‘out, out, out.'”

In the future, company insiders say, the algorithms will get even better at analyzing your data and predicting what you want before you want it.

The more data an LLM is trained on, the smarter it becomes — and there is still more customer data incoming at Zalando.

For example, right now, Zalando isn’t really using the text conversations shoppers are having with its online assistant but is likely to do so in the future.

And the more people shop, the larger data trail they leave behind from which personalized recommendations can be made. At another keynote during the Zalando event David Fisher, founder of media and fashion brand Highsnobiety, spoke about how beauty, sport and groceries are markers of status and offer even more usable insights. Zalando is working hard on pushing the two former categories.

But there are other aspects of AI in online fashion shopping that are not yet fully operational and likely won’t come as fast or possibly ever be as useful. One of those is AI-powered shopping assistants or agents.

An AI agent is basically a program or software that uses an LLM’s computing power and reasoning to execute a certain task for its owner. Müller pointed out that Open AI has already moved away from plans for AI-driven shopping assistants and has instead been selling advertising. Google continues to work on a shopping assistant but at the moment, while those sorts of assistants can search for a product, they cannot do the transaction for you. Müller thinks that even when those shopping assistants do improve —he predicts within five years or so — they might not be much help to anybody truly looking for wardrobe inspiration.

“I think shopping can be divided into two [use] cases — one that’s about transactions in general, like booking flights or hotels. It’s a job to get done. But in fashion, the majority of money is not spent like this,” he pointed out. It’s more about inspiration and style and the shopping “journey.”

That’s the background to Müller’s three predictions for the near-term future of AI in fashion.

AI-driven content creation is the first because what he calls “a combination of a fashion magazine and e-commerce” is important for inspiration and the shopping journey.

“Secondly, everything becomes more personalized,” Müller continued. “So through things like virtual try-on, what your online shop recommends to you, everything will become much more personalized and tailored to you. That’s a mega trend. And I would say the third trend we are seeing is on the delivery side. Recycling gets faster, more reliable, and everything becomes more frictionless.”

The future of AI involves a combination of all three, he concluded: “More inspirational, more personalized and less friction.”

After returning from a mostly internet-free vacation a little over a week ago, I couldn’t believe the online buzz about Meta Platform’s new agent app, Muse. I immediately downloaded it and began assigning tasks to it like it was an intern in an era without labor laws.

I created an agent to monitor the internet for reviews of a new album by the artist Beck. I ordered Muse to keep an eye on Facebook Marketplace for obscure stereo equipment. And I used it to create alerts that flagged new SEC filings by companies I want to follow closely. Muse accomplished all of those jobs effortlessly, and using the app was even—dare I say it?—delightful.

These were all fairly banal assignments that I could have accomplished pretty easily without Muse. If I wanted more out of the app, I would need to give Muse access to things like my email inbox—which it promised to scour to build agendas for the day—and my credit card account, which it could use to flag recurring charges I might have forgotten about.

That’s when I began to wobble. Giving Muse access to some of my most sensitive personal accounts is the kind of thing that would make people like my wife—who is whatever the opposite of “AI-pilled” is—question my sanity. I had already read my colleague Abram Brown’s account of how Muse had double-booked hotel rooms for him. And yesterday another colleague, Jyoti Mann, reported on the discovery of a security vulnerability in Muse that could let a hacker snag personal information.

This is the trust purgatory I predict a lot of people are going to get stuck in when it comes to giving agents the digital keys to run their lives. Overall, I am at the more trustful end of the spectrum when it comes to tech companies. I have a doorbell camera made by Google. I use Amazon for prescription medicines. I figure that the reputational risks for them of violating that trust are great enough so it’s really not in their interest to do so. But the drumbeat of cybersecurity incidents involving AI models, including the OpenAI–Hugging Face intrusion, makes the leap of faith with AI feel especially perilous at this moment.

In the meantime, I continue to conduct what I view as safe experiments with Muse. In fact, I may have discovered what I believe is one of its best use cases.

There are at least a dozen apps on my phone with atrocious user interfaces that haven’t been updated in years. One of them is for a Wi-Fi–enabled thermostat that controls the heat in a section of my house. Could Muse make it easier to use the appalling software for this thermostat?

I gave Muse my login for the web version of the app and ordered it to set a fall and winter heating schedule. It took Muse more than 15 minutes, but ultimately it accomplished the task. I cringe thinking about the electricity that chore required.

Still, I will respect Muse if it can act as my go-between with the ugliest apps on my phone—as long as the risks of doing so are minimal. For the time being, I’ll be keeping Muse on a short leash.

Apple must pay $5.7 billion for infringing on patents held by Taction Technology, a US jury ruled on Friday. The patents relate to Apple’s Taptic Engine, which is the hardware Apple uses to provide haptic feedback for notifications, button presses, and other interactions.

Taction first filed the lawsuit in 2021, alleging Apple had “infringed and continues to infringe, directly and indirectly” its patents.

As reported by CNBC, the lawsuit centered around two patents:

• U.S. Patent No. 10,659,885
• U.S. Patent No. 10,820,117

Both patents are focused on a “vibration module for applying vibrational tractions to a wearer’s skin.” Taction argued that Apple’s Taptic Engine infringes upon its patents, saying that Apple was “capitalizing on Taction’s innovation and success.”

Apple’s Taptic Engine first debuted as part of the Apple Watch in 2014 and came to the iPhone 6s and iPhone 6s Plus the following year, replacing the older vibration motor.

In a statement, an Apple spokesperson said:

Taction Technology is a California-based company that describes itself as being “obsessed by sound.” The company says that its “Transporter Technology powers the game-changing Corsair HS60 Haptic headphones, and will soon be powering other premium headphones from major manufacturers.”

In a statement to CNBC, Taction’s lead counsel said:

You can read the original complaint for patent infringement filed by Taction here and Friday’s jury ruling here.