A Bear Case for the Bear Case

A viral post from Citrini Research warning of a “2028 Global Intelligence Crisis” rattled markets. The scenario imagined AI disrupting white-collar industries from software to finance, triggering double-digit unemployment and recession-level stress.

Stocks tied to those themes sold off. Companies mentioned by name in the post saw shares fall, even though there was no new product release or breakthrough announcement. Unlike prior declines tied to real AI capability updates from firms like Anthropic, this move appeared driven by sentiment rather than new data.

The core claim blends two arguments.

First, a microeconomic one: AI will displace large swaths of service jobs.

Second, a macroeconomic one: that disruption will crash the broader economy.

But even if the first proves partly true, the second does not automatically follow.

Productivity shocks do not inherently cause depressions. If AI makes services cheaper and more efficient, output can rise even as certain roles disappear. Labor markets adjust. New industries form. Policy tools exist. The Federal Reserve can cut rates. Fiscal policy can stabilize demand. Automatic stabilizers like unemployment insurance cushion shocks.

For unemployment to surge above 10%, job destruction would need to outpace job creation rapidly and simultaneously across sectors. That is possible in theory. It is not the base case implied by history.

AI may reshape the labor market. That does not mean it detonates the economy. Sometimes a scary bedtime story is just that.