An AI Thought Experiment on Substack Is Sending The Stock Market Spiraling

Gizmodo · Feb 23, 2026 · Collected from RSS

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On Sunday, analysis firm Citrini Research published a thought experiment on Substack that reads like a piece of fiction. Titled “The 2028 Global Intelligence Crisis,” it’s a scenario set in June of that year in which unemployment has shot up to 10.2% in the U.S. due to mass AI-driven white-collar unemployment, which begins with an “initial wave of layoffs” in early 2026. GDP growth is still great, and productivity is booming in this hypothetical scenario, with AI agents creating a “ghost GDP,” aka “output that shows up in the national accounts but never circulates through the real economy.” In this dystopia, consumer spending has hugely declined as a negative feedback loop has been formed. “AI capabilities improved, companies needed fewer workers, white collar layoffs increased, displaced workers spent less, margin pressure pushed firms to invest more in AI, AI capabilities improved,” the essay forecasts. AI disrupts software, which leads to software-backed loan defaults. The pace of AI disruption is not contained to software in this scenario: AI agents, vibe coding, and autonomous driving come for the throne of delivery apps as dozens of vibe-coded DoorDash alternatives spring up overnight. Then, agentic commerce, coupled with stablecoins, gets rid of transaction fees and upends the business models of payment processors like Mastercard and card-focused banks like American Express. “What follows is a scenario, not a prediction,” the authors wrote. “Hopefully, reading this leaves you more prepared for potential left tail risks as AI makes the economy increasingly weird.” The result was mayhem on the market. Software stocks, like ServiceNow, which were already on an AI-driven downward journey, slid even more. This time, accompanying them were shares of delivery giants DoorDash and Uber, as well as payments companies like American Express, Blackstone, KKR, Mastercard, Visa, and Capital One. Some investors, at least, seem convinced, likely because there was already AI-driven negative sentiment in the market to begin with. Software stocks have been battered in February in what has been called the SaaSpocalypse. Scared investors are largely citing the release of new AI capabilities and agents in Anthropic’s AI work companion, Claude Cowork, as the trigger for the sell-off. Wall Street seems certain that AI is on the road to becoming so good that people won’t have to rely on the numerous specialized services provided by software companies anymore, and instead just vibe code whatever they need or ask ChatGPT or Claude to perform the task. “The seemingly wide moats of these companies feel a lot more narrow today as competition from AI-created products intensifies,” Ocean Park Asset Management chief investment officer James St. Aubin told Reuters earlier this month. “Perhaps this is an overreaction, but the threat is real and valuations must account for that. My biggest fear is that this is a canary in the coal mine for the labor market.” But flashy online projections of complete AI takeover are not magic crystal balls into the future. Similarly, early last year, former OpenAI employee Daniel Kokotajlo published a comprehensive prediction of a swift timeline to humanity-ending superintelligence, in a report that made waves across the internet and was even referenced by Vice President JD Vance. Just last month, Kokotajlo had to walk back his claims, saying that superintelligence development was actually happening slower than he anticipated. It’s important to keep in mind that both the concept of and road to artificial general intelligence, aka AI that can surpass human intelligence and ability, is already a contentious topic among experts. Tech leaders like xAI’s Elon Musk, Anthropic’s Dario Amodei, and OpenAI’s Sam Altman claim that AGI will be achieved sometime in the next 2-4 years (all three companies reportedly have flashy and highly consequential IPO plans for this year), but a November survey of industry leaders found that the average expert disagreed with that timeline. Even if the superintelligence timeline does become reality, experts don’t see eye to eye on just how much it can disrupt industries. Experts claim that the software sell-off is “illogical” and “overdone,” and improving AI ability would actually lead to demand for more software and the ability to create better applications at lower prices. There is also the irony that, as investors are selling off shares of other companies rapidly because they think AI is about to get so big so fast, they are simultaneously souring on astronomical AI spending commitments made by tech giants, and voicing concerns over an AI bubble. “It seems like markets found a reason to be worried about too little AI and too much AI at the same time,” Morningstar equity market strategist Lochlan Halloway told The Guardian last week.