He wasn\u2019t alone. Citrini Research<\/a>, the top finance Substack, posted a similar essay on Feb. 22, warning of a \u201cglobal intelligence crisis<\/a>\u201d brought on by sudden advancements in AI. The highly speculative, but deeply resonant essay painted a doomsday scenario of a \u201chuman intelligence displacement spiral\u201d where AI agents rapidly replace software engineers, financial advisors, and middle management. At its core was the concept of a \u201cghost GDP\u201d\u2014economic output that benefits the owners of computing power but never circulates through the human consumer economy. In this scenario, stripped of high-paying salaries, prime borrowers default and tank the $13 trillion residential mortgage market, unemployment spikes above 10%, the stock market corrects down 38%, and the economy collapses into a deflationary spiral. Unusually for a work of speculative fiction, the market reacted to the piece<\/a>, showing that the \u201cAI scare\u201d trade was real, at least in readers\u2019 minds.<\/p>\n The Dow Jones Industrial Average was down over 800 points on Monday (1.66%), with software stocks getting hit especially hard. Analysts and economists responded throughout the week that the economics implied by Citrini\u2019s argument were unsound, but on Thursday, Twitter co-founder and current Block<\/a> CEO Jack Dorsey stunned the market by announcing a massive 40% downsizing<\/a> of his company\u2019s ranks. In words that could have come out of the Citrini report, he wrote to shareholders that \u201cintelligence tools have changed what it means to build and run a company.\u201d Block stock rose nearly 14% the next day.<\/p>\n \u201cThis is one of the first major examples of AI driving layoffs, but certainly not the last,\u201d Matt Shumer wrote on X<\/a>. \u201cIf you\u2019re saying \u2018this won\u2019t happen to me,\u2019 reevaluate your thoughts. Now. It may be the most important thing you do.\u201d <\/p>\n Many Wall Street banks, top economists and even AI CEOs consider this all to still be overblown hype, cautioning that macroeconomics 101 implies the Citrini narrative is false. Others stake out a middle ground, predicting an AI transition that will be difficult but ultimately positive. But the Block layoffs suggest that, at least in the tech sector, the AI scare is moving from market narrative to sudden reality. And America isn\u2019t prepared.<\/p>\n The disconnect that misses millions falling off the white-collar cliff<\/p>\n Veteran macroeconomic analyst Albert Edwards<\/a> of Societe Generale<\/a> is a certain type of famous in the finance world for his alternative, somewhat contrarian views, which the French investment bank stresses do not reflect its house opinion. In 2023, he wondered aloud in his weekly strategy note about the phenomenon of \u201cgreedflation\u201d signaling potentially the end of capitalism<\/a>, as record high profit margins indicated that corporations were raising prices more than they needed to, with the working and middle classes suffering as a result.<\/p>\n Edwards claimed the Citrini research vindicated his analyses of late. \u201cThe AI macro doomsday scenario is not for 2028,\u201d he wrote on Monday<\/a>. \u201cIt\u2019s here right now!\u201d He cited data showing that the U.S. consumer was \u201crunning on fumes\u201d as incomes had \u201chit a brick wall\u201d during the greedflation era. \u201cI can honestly say that if I was 18 now, there is no way I would go to university only to leave with huge debts and poor job prospects,\u201d he wrote. \u201cInstead, I would become an electrician or similar trade.\u201d<\/p>\n Nicole James<\/p>\n Nicole James<\/a>, a 42-year-old former creative executive who built Snapchat\u2019s content team, is living the reality that Edwards described. After a series of increasingly senior roles, including her stint at Snap, she was head of content at the animation studio Invisible Universe<\/a> until 2023, when the company pivoted to become an AI studio and laid off half its staff. James hasn\u2019t been employed full-time since, despite never having a gap in employment for the previous decade-and-a-half. <\/p>\n She told Fortune about sending out hundreds of applications and facing endless ghosting and a profound lack of respect for her creative skills. Maybe she\u2019s a victim of an entertainment recession more than an AI victim, she said, but she\u2019s working retail to make ends meet. She also said she\u2019s struggling with a certain loss of identity. \u201cI really felt embarrassed when I showed up to work the first day and like put on my name tag,\u201d James admitted. \u201cIt\u2019s very shocking. Like I just fell off a cliff and I don\u2019t, I have no flashlight.\u201d<\/p>\n Most of the country feels as if they\u2019re on the cliff or falling, according to Laks Ganapathi<\/a>, founder of the independent investment research firm Unicus. Ganapathi\u2019s firm produced a research note very similar to the Citrini scenario in mid-January, she said, except they called it the \u201cvibecession,\u201d a term popularized by economics writer Kyla Scanlon. Forecasting high unemployment and stubborn inflation into the second half of 2026, she predicted that \u201ccompanies will lean as much as they can, as fast as they can with AI. And that is going to cut a lot of jobs. And some companies in the process are going to completely stop existing as a going concern.\u201d<\/p>\n Laks Ganipathi<\/p>\n Then, because of \u201cskyhigh inflation\u201d and sticky inflation, Ganapathi argued, a huge amount of people will persistently experience recession, while another segment of people will insist that the data shows everything is fine in the economy. She said the \u201chuge disconnect between the data and the reality will keep widening, and AI will only make it worse.\u201d It sounds a lot like the \u201cghost GDP\u201d thesis of the Citrini essay, she agreed. What really matters about this disconnect, she added, is that it means the U.S. economy won\u2019t experience a \u201cclean, single-event collapse.\u201d Millions of Americans, in other words, could find themselves in a continuous tumble off a cliff, without the flashlight.<\/p>\n Wall Street pushback and the jobs of tomorrow<\/p>\n Wall Street is attempting to talk the market off the ledge. Citadel Securities published a blistering takedown<\/a> of the Citrini essay, pointing out that the data flatly contradicts the thesis. If AI is so destructive, they argued, why is demand for software engineers actually up 11% year-over-year?<\/p>\n Citadel argues the doomsday thesis relies on the \u201crecursive technology fallacy,\u201d ignoring the physical constraints of energy and compute power that naturally brake infinite AI expansion. Historically, Citadel notes, productivity shocks lower marginal costs, expand output, and increase real income, acting as a complement to human labor rather than a strict substitute. Other critics of the Citrini essay include Tyler Cowen, of Marginal Revolution fame, and Robert Armstrong, the Unhedged columnist at the Financial Times.<\/p>\n Morgan Stanley<\/a> similarly urged calm, reminding investors that while AI will alter the labor force, it will not permanently replace it. Instead, the firm predicted a wave of entirely new corporate roles<\/a>, such as the \u201cChief AI Officer\u201d and specialized jobs like \u201ccomputational geneticists\u201d and \u201cpredictive maintenance engineers.\u201d Morgan Stanley even envisioned a new product manager\/engineer hybrid role centered around \u201cvibe coding\u201d\u2014prototyping concepts through natural language before handing them off for deployment.<\/p>\n Bank of America<\/a> Research, for its part, claimed the \u201capocalyptic narrative\u201d about AI \u201cdoesn\u2019t square well with sound economic theory.\u201d Global economist Claudio Irigoyen wrote on Friday that the selloff in markets to \u201ca combination of crowded positioning and multiple equilibria, similar to a bank run triggered by unfounded rumors of insolvency,\u201d similar to warnings from UBS\u2019 Paul Donovan and Apollo Global Management\u2019s Torsten Slok that retail traders\u2019 prominence<\/a> is leaving markets vulnerable to narrative and knee-jerk movements. <\/p>\n Notes of caution included Citigroup<\/a> allowing that \u201ceventually, AI implementation will lead to higher unemployment and\u00a0deflation,\u201d while Goldman Sachs allowed that \u201cAI impacts could be more frontloaded than the 10-year adoption cycle embedded in our forecasts,\u201d but a \u201cgradual and orderly adoption cycle\u201d remains the most likely outcome.<\/p>\n Entering a more optimized world<\/p>\n Even several tech CEOs told Fortune, echoing recent comments from PromptQL founder Tanmai Gopal<\/a>, that the AI job-loss narrative is mostly hype and there will be plenty of jobs going forward.<\/p>\n David Stout<\/a>, CEO of webAI<\/a>, the AI lab that was valued at $2.5 billion as of January, said the scenario for jobs going forward will be like a closely watched travel budget. If you don\u2019t use up every penny of the budget, your company will take back what\u2019s not being spent. Instead of massive job loss, he said, companies will be \u201cmuch more optimized\u201d with proper AI adoption. \u201cI think AI is going to help signal some employees that probably aren\u2019t contributing \u2026 You\u2019ll see companies let people go because they\u2019re like, \u2018Wait a second, AI is doing what you said would take a year to do. Something\u2019s wrong.\u2019 I think it\u2019s going to be like those type of moments.\u201d<\/p>\n David Stout<\/p>\n Still, as an AI executive himself, Stout said he thinks it\u2019s absurd to argue that the technology can really replace humans. \u201cAI is not just this autonomous thing that goes and does exactly what it needs to do,\u201d he said. \u201cIf it is, we\u2019re not seeing it.\u201d<\/p>\n Even an executive inside an industry actually being disrupted\u2014insurance\u2014poured cold water on the mass displacement theory. Amrish Singh<\/a>, CEO of the AI insurance startup Liberate<\/a>, told Fortune that he\u2019s seeing tremendous growth in terms of what AI can automate in the repetitive, mechanical processing of insurance claims. \u201cWe\u2019re today at about 2.8 million automated actions a month\u2026tasks, things that we can automate using AI.\u201d He also noted major disclosures from Allianz<\/a> and Travelers<\/a> about huge savings already being achieved as a result of AI adoption. \u201cWe\u2019re seeing many companies, not just Liberate customers, but across the insurance industry, finding a way to use AI specifically on those ordinary tasks, you know, answering phone calls, emails, SMS, resolving the request for the customer with serious ROI.\u201d<\/p>\n The reason people shouldn\u2019t fear the looming cliff of job loss, he added, comes down to a basic understanding of the insurance industry. Estimating that $25 out of every $100 spent on handling a claim is operating expenses\u2014answering calls, emails and the like\u2014that\u2019s a huge saving in the $1.2 trillion insurance industry. Even then \u201cthis particular industry is one where there\u2019s always value of human effort, right? Humans are amazing at judgment.\u201d Every insurance claim will require a visit, and then likely a lengthy conversation, with a claims adjuster, he added. \u201cHumans are amazing at evaluating a very specific, unique circumstance.\u201d<\/p>\n Amrish Singh<\/p>\n There\u2019s another thing about humans with this AI transition, Singh added: \u201cHumans swing between doomsday and complete disbelief,\u201d while the truth lies in the messy middle. Ultimately, Singh predicted the integration of AI will follow the historical pattern of enterprise technology: \u201cIt\u2019s slow, and then it\u2019s sudden.\u201d<\/p>\n The \u2018new-collar\u2019 boom<\/p>\n What it still comes down to, as well, is the physical reality of the AI boom and the fact that data centers represent a bottleneck\u2014adoption will be limited as long as the amount of compute is limited as well. Mike Mathews<\/a> proudly recalled to Fortune that he began his career in the Boston area as a fourth-generation plumber, with his family working in the blue-collar trades dating back to the 1920s. Now that he\u2019s the global digital infrastructure practice leader for Marsh, he\u2019s familiar with the figures: The world currently has 12,000 data centers, with 3,000 more planned, and he said both white-collar and blue-collar jobs will be replaced by what he called the \u201cnew-collar\u201d economy.<\/p>\n \u201cYou\u2019re going to have very, very high-paid blue-collar workers,\u201d Mathews said. He argued that a massive social shift is required, as parents must begin guiding their children toward vocational training and technical labs rather than strictly white-collar degrees. And these won\u2019t be one-time jobs just for the construction of the data centers, either; Mathews said the vast majority will require complete retrofitting to handle AI\u2019s intense power and liquid cooling needs.<\/p>\n \u201cIt\u2019s hard to imagine two white-collar parents understanding the path to a very successful blue-collar career where an electrician is working in a data center making $250,000, [or] $300,000. It\u2019s unimaginable, but that\u2019s where we\u2019re headed.\u201d <\/p>\n Mathews included himself in this big social switch that needs to happen, when asked about whether he\u2019d want his own kids to follow in the family footsteps. Explaining that his daughters opted for white-collar work, he said, \u201cI live that dream of seeing them \u2026 going to a skyscraper [for work], holding a Starbucks<\/a> coffee, not going to a data center and working on high-voltage switchgear.\u201d But he said it will be a big value going forward to emphasize getting both kinds of education. \u201cThere\u2019s time in your life to get both, certainly before the age of 24. Get some technology training, get some hands-on training, get various skill sets.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"For months, the threat of artificial intelligence (AI) replacing human workers has hovered over the American economy like…\n","protected":false},"author":2,"featured_media":314837,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[345,343,344,6373,26227,5603,85,46,265,190,125],"class_list":{"0":"post-314836","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-artificial-intelligence","8":"tag-ai","9":"tag-artificial-intelligence","10":"tag-artificialintelligence","11":"tag-careers","12":"tag-disruption","13":"tag-economics","14":"tag-il","15":"tag-israel","16":"tag-jobs","17":"tag-markets","18":"tag-technology"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/314836","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/comments?post=314836"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/314836\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media\/314837"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media?parent=314836"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/categories?post=314836"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/tags?post=314836"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}![\"Woman](\"https:\/\/www.newsbeep.com\/il\/wp-content\/uploads\/2026\/02\/image1.jpeg\"\/)
<\/p>\n![\"Woman](\"https:\/\/www.newsbeep.com\/il\/wp-content\/uploads\/2026\/02\/1656805882393_649067.jpg\"\/)
Laks Ganipathi is the founder of the independent investment research firm Unicus.<\/p>\n![\"Man](\"https:\/\/www.newsbeep.com\/il\/wp-content\/uploads\/2026\/02\/David-Stout.webp.jpeg\"\/)
David Stout is the founder of webAI.<\/p>\n![\"Man](\"https:\/\/www.newsbeep.com\/il\/wp-content\/uploads\/2026\/02\/1761105608318.jpg\"\/)
Amrish Singh is the CEO of the AI insurance startup Liberate<\/p>\n![\"\"](\"https:\/\/www.newsbeep.com\/il\/wp-content\/uploads\/2026\/02\/1759769837182.jpg\"\/)
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