I want to tell you why I think my own product is going to sit on the shelf for a while.
Not because it is wrong. Because of when it arrived.
Let me start with the part everybody can feel.
In July, Americans cut their spending. Retail sales fell six tenths of a percent, the biggest drop in over a year. Take out cars and gas and the drop was smaller, only two tenths. So it was not a collapse. But it was the first real flinch in a long time.
Then in August, the mood fell off a cliff. The University of Michigan sentiment reading came in at 51, down from 55 the month before. Economists had guessed 54 or 55. When people were asked how they expect business conditions to look down the road, the long-term answer dropped seventeen percent in one month.
Only eight percent of people said they expect their income to grow faster than prices this year.
Eight percent.
Gas is at four dollars and six cents a gallon. Triple-A says a price that high this late in the summer has never happened before. Tax refunds this spring ran about twelve percent bigger than last year, and that money carried a lot of households through the first half. That money is spent now.
You can see it in what the big stores said this week. Walmart’s US same-store sales rose two point six percent when analysts wanted three point eight. Slowest quarter in six years. The stock fell nine percent in a day. TJ Maxx’s parent went from six percent growth to one. Target held on, but it did it by cutting prices on more than ten thousand items.
This was my focus.
Restaurant and bar spending went up half a percent. Target’s foot traffic went up three point six percent.
People are still going out. They are still walking in the door.
They are just buying the cheap version.
That is not a buyer’s strike. That is a trade-down. And a trade-down is a different animal, because it does not look like a crisis on the way in. It looks like everything is fine until you check the margin.
Now let me connect this to my own line of work, and I want to be careful here, because it is easy to draw a line that is not really there.
Consumer spending and business spending are two different animals. A family skipping a new refrigerator does not mean a company freezes its software budget. I did not find data proving that link.
But there is a second thing happening, and it is the one that actually affects me.
Three weeks ago, Europe’s AI Act turned on its transparency rules. They bind anybody whose AI output reaches Europe, no matter where the company sits. Around the same time, the European Commission added thirty-eight people to its AI office and published binding requirements on labeling, logging, and documentation. A draft European standard for AI quality management went out for comment on the nineteenth.
That is a wall of mandatory work landing on companies all at once.
And mandatory work eats the budget first.
When a company has a hundred dollars for AI governance and eighty of it now goes to things a regulator will fine them for skipping, the other twenty gets fought over. What survives is whatever has a filing deadline attached.
My framework does not have a filing deadline attached.
Nobody is required to adopt it. No agency inspects for it. No auditor asks. It governs how a machine behaves inside a conversation, and there is not a regulator on earth with jurisdiction over that.
So I am selling the optional thing in the year the mandatory things all came due.
That is not bad luck and it is not a flaw in the work. It is timing, and timing is not something you argue with.
Here is what I think happens next, and I could be wrong.
I think the compliance wave takes eighteen months to two years to absorb. Companies will spend that time filling out forms, hiring officers, and building documentation trails. They will do it because they have to.
And at the end of it, some of them are going to notice something.
They will have a complete paper record proving their AI system is compliant. Labeled, logged, documented, filed.
And they will still have no idea whether the thing tells the truth.
Because none of the rules ask that. The European rule says a machine has to announce it is a machine when you first start talking to it. One disclosure, at the door, and then nothing. Nobody checks what it says in the next ninety minutes.
The gap does not close. It just gets papered over, and then somebody looks under the paper.
That is when the optional thing stops being optional. Not because a regulator says so. Because somebody got burned by a fluent, well-formatted, completely confident answer that was wrong, and their compliance file did not save them.
I do not know when that happens. I would guess it takes a real incident with a real name attached.
So what do I do in the meantime.
I keep building. I keep testing. I keep publishing the record, including the parts where the framework catches me.
Because here is the thing about being early. The only asset early buys you is a track record. If I spend the quiet stretch putting one on the board, then when the question finally gets asked, there is something to point at that is dated and public and was not written after the fact.
If I spend the quiet stretch waiting, I have nothing but an opinion and a website.
I would rather be the one with the receipts.
This post was drafted with AI governed assistance and reviewed and directed by Michael S. Faust Sr. before publication.
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