Some writers here at The Motley Fool have been worrying about an AI-driven stock market crash. And it seems others are waking up to the risk because an AI doomsday Substack post has gone viral this week.
The post from Citrini Research even caused a number of stocks mentioned to drop sharply on Monday (23 February). These included DoorDash, American Express, and (fittingly) Monday.com.
What did this post say? And how worried should we be?
The lengthy post in question — entitled The 2028 Global Intelligence Crisis — describes a fictional future where AI rapidly displaces human labour.
A negative feedback loop emerges where companies, facing margin pressure, replace white-collar workers with AI. This soon reduces consumer spending, leading to further layoffs.
Meanwhile, autonomous AI agents do more tasks for consumers (insurance renewals, travel booking, shopping, etc). Unlike humans, AI agents aren’t loyal to apps like Uber or Booking, so a huge amount of enterprise value is destroyed.
The S&P 500 starts crashing.
Jobs become harder to find and the crisis threatens the $13trn residential US mortgage market as white-collar incomes vanish.
The paradox here is that this scary scenario is only possible if AI truly succeeds, not fails.
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