Sudden Panic
A viral Substack post titled The 2028 Global Intelligence Crisis (clearly written with AI) is causing significant turbulence in the stock market after depicting a dystopian future where AI causes mass white collar unemployment. Published by Citrini Research, the essay is written as a fictional retrospective from the year 2028. It describes a scenario where U.S. unemployment hits 10.2 percent because AI agents have automated away millions of jobs. This is not the first time an essay greatly authored in large part by AI has caused a ton of panic.
The report introduces the concept of ghost GDP, which refers to economic output that looks good on paper but fails to circulate in the real world because machines do not buy consumer goods. This creates a negative feedback loop where companies lay off workers to save money, which leads to lower consumer spending, which then forces companies to rely even more heavily on AI to maintain margins. Any company in the business of providing services that involves humans, process and technology is ripe for replacement. The consumer of the services can use AI to build their own and have it work exactly right for them.
The authors labeled the post a thought experiment rather than a formal prediction, investors already on edge about the SaaSpocalypse selloff used it as a reason to dump shares. Which goes to show that investors are not the most visionary bunch, they are prone to jitters triggered by random sources of unease including such essays. Software companies like ServiceNow saw further declines, but the panic spread to payment processors like Visa and Mastercard and delivery services like Uber and DoorDash. The theory is that AI agents and vibe coding will eventually allow people to bypass these middlemen entirely. I guess we are talking about agents of people trading goods and services with each other in good old-fashioned barter.
Critics and industry experts remain skeptical of the panic. Many argue that the selloff is an overreaction and point out that previous dire AI predictions have already been walked back. Some analysts suggest that more advanced AI will actually increase demand for software by making it cheaper and more accessible. Despite these reassurances, the incident highlights a growing contradiction in the market where investors are simultaneously terrified of AI being too powerful and worried that the massive financial investment in the technology will never pay off.
The report introduces the concept of ghost GDP, which refers to economic output that looks good on paper but fails to circulate in the real world because machines do not buy consumer goods. This creates a negative feedback loop where companies lay off workers to save money, which leads to lower consumer spending, which then forces companies to rely even more heavily on AI to maintain margins. Any company in the business of providing services that involves humans, process and technology is ripe for replacement. The consumer of the services can use AI to build their own and have it work exactly right for them.
The authors labeled the post a thought experiment rather than a formal prediction, investors already on edge about the SaaSpocalypse selloff used it as a reason to dump shares. Which goes to show that investors are not the most visionary bunch, they are prone to jitters triggered by random sources of unease including such essays. Software companies like ServiceNow saw further declines, but the panic spread to payment processors like Visa and Mastercard and delivery services like Uber and DoorDash. The theory is that AI agents and vibe coding will eventually allow people to bypass these middlemen entirely. I guess we are talking about agents of people trading goods and services with each other in good old-fashioned barter.
Critics and industry experts remain skeptical of the panic. Many argue that the selloff is an overreaction and point out that previous dire AI predictions have already been walked back. Some analysts suggest that more advanced AI will actually increase demand for software by making it cheaper and more accessible. Despite these reassurances, the incident highlights a growing contradiction in the market where investors are simultaneously terrified of AI being too powerful and worried that the massive financial investment in the technology will never pay off.
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