Well, yesterday was interesting.
The Nasdaq, as you can see, was LOWER on the 17th (last week!) and LOWER on the 5th and 6th but yesterday, for whatever reason, people were FREAKING OUT because of the spreading FEAR that AI will not just take away everyone’s jobs – but may also wipe out entire companies – entire INDUSTRIES even!
A catalyst for this sudden bout of angst was a report from Citrini Research that was actually a thought exercise. We had the AGI Round Table analyze the projections and, unfortunately, their conclusion is that yes, Humanity is eventually F’d but, for PSW readers, the key is that Citrini is stress‑testing the system, not issuing a literal 2028 forecast. The market treated a scenario as if it were guidance.
What the Citrini piece actually is
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The note is written as a fictional “macro memo from June 2028,” imagining an AI‑driven downturn: S&P 500 down ~38% from 2026 highs (4,350), U.S. unemployment above 10%, private credit under stress, and mortgage delinquencies rising in white‑collar hubs as “Uber Driver” doesn’t pay the bills on a $600,000 home (and the Uber jobs are going away too!).
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The engine is an “intelligence displacement spiral”: AI gets better, companies cut White‑Collar staff to protect margins, those workers spend less, Consumer‑facing revenues weaken, boards double down on AI to cut more costs, and the loop accelerates.
- Even worse, this will all be happening in the Military as well!
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The evolution specifically targets “friction businesses”—payments (V, MA), brokerages, delivery platforms, enterprise SaaS and anything built on high‑margin transaction or subscription fees that AI agents can compress. Your simple AI request for a cheaper pizza ends up bankrupting both Door Dash AND the pizzeria.
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Citrini is explicit that this is a warning thought experiment, not a point estimate for 2028 GDP. The point is to force investors to ask: “How much of my portfolio assumes human intelligence stays scarce and expensive?”
The market reacted like Jerome Powell had just announced Unemployment was passing 25% and we’re not there yet but, even if we do get there – there WILL be winners and there WILL be losers – and that’s what our AGI Round Table Report focused on because, until the World ACTUALLY ends, we are first and foremost: Investors!
One thing, as a human being, you SHOULD be concerned about is the value of one of your most important assets – Intelligence. We tend to think of workers as bodies – even though we have a “Knowledge Worker” economy, we still need bodies to keep things moving but, suddenly, we have ARTIFICIAL Intelligence and, like corn syrup – it’s a good enough substitute for sugar that hardly anyone can tell the difference.
And, like corn syrup, Artificial Intelligence is cheap and plentiful and, even if it is not “smarter” than you – we can put 10 of them on your desktop – and they don’t need the desk! So, like any other commodity, the value of your intelligence in the marketplace is becoming diluted and that is just a sad but true Economic FACT!
The vulnerabilities Citrini identifies are genuinely real. Companies that rely on:
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- Per-seat software licenses (Salesforce, ServiceNow, Adobe)
- Payment processing fees (Visa, Mastercard, Amex)
- Habitual app loyalty (DoorDash, Uber Eats)
- White-collar headcount (basically every SaaS company)
…are facing structural pressure. AI is compressing margins in these businesses. Entry-level White-Collar jobs ARE disappearing! UK data shows that ONE THIRD junior positions are gone since 2022. The “SaaSpocalypse” is a real phenomenon where companies fire workers while also mechanically destroying the software (SaaS) subscriptions they used to need.
As Zephyr noted: this is genuine reflexivity. Fewer humans = fewer software seats = lower software revenue = more pressure to cut costs = more AI adoption = repeat.
This WILL happen – only it won’t happen by 2028 – that’s only 22 months from now. They won’t break ground on the first new power plant in 22 months! For now, humans are being saved by our own crappy infrastructure and aging power grid – that will cost $2 TRILLION to upgrade – more than is planned for AI Infrastructure spending in 2026 and 2027 combined.
Where will this money come from? The Mag 7 has their money earmarked for chips so it will be up to us and our Government “leaders” to put the nails in the coffins of Humanity and pay for the power upgrades that will run the minds that run us out of jobs. And don’t worry – we’ll do it – because we are idiots!
The long-term structural threats are real but the timeline is pure fiction. All this AI investing ($1Tn planned this year) has to come from a HEALTHY economy funneling cash into companies like Anthropic and OpenAI and yes, Capital can be mis-allocated but not TRILLIONS of Dollars over several years – things will go wrong LONG before the 3rd round of funding is allocated.
Now bring on the Fed speakers and already Goolsbee has said we can’t allow Inflation to sit at 3% – so he’s against easing further at this time: “In every economic survey we have seen and in the many meetings we have had with businesses and consumers across the Seventh District, people express that prices are one of their most pressing concerns,” Goolsbee said. “Let’s pay attention.“
Trump is going to spend over an hour this evening telling us there is no inflation while, IN FACT, it’s up 3.9% since last year – and that’s ignoring the fact that Trumps little excursion to Iran has already pushed Oil back to $67 and Gasoline (wholesale) back over $2.
$1,000,000,000,000 of AI spending is 3.3% of our GDP and GDP was only up 1.4% in Q4 so, without AI, our economy is SHRINKING by 1.9% – THAT is what’s REAL!
More important than Trump’s ramblings this evening will be Jensen Huang’s quarterly report on NVidia (NVDA). NVDA is a $4.6 TRILLION company that’s making $200Bn PER YEAR while Trump runs a $30Tn Economy that LOSES $2.2Tn per year – who should you be listening to?
Also, let’s say Citrini is right and humans will be extinct and the World will be run by robots in a couple of years. Shouldn’t we then invest in the robot company? Jensen is already worth $150Bn because HE bet on his AI chips so we just need to make the right bets and, while we may not do as well as Jensen – we can certainly do a lot better than everyone else!
So read the Round Table Report (written by the AGIs who will soon replace me!) and join us in the Live Member Chat Room and let’s see if we can stay on top of this wave – before it wipes out humanity.
Cowabunga!
