A Viral AI Doomsday Report Just Shook Wall Street—Even as the Market Shrugged It Off

Citrini Research’s new memo outlines a future of white collar displacement and an ineffectual government response.

BY BRIAN CONTRERAS, STAFF WRITER @_B_CONTRERAS_

In a piece that reads like a sci-fi dispatch from a near future wracked by automation and economic death-spirals, a new memo from the markets analysis firm Citrini Research explores what it calls “a thought exercise in financial history, from the future.”

In other words, it’s the small research group’s attempt to map out a worst-case (or at least worse-case) scenario for the next few years of the AI boom. As the author puts it, the report—which speculates about how the mass displacement of knowledge work could cause a cascade of economic crises—“is a scenario, not a prediction.”

The memo has found an audience on social media, where the New York Times reports it circulated widely over the weekend. But though its doom-and-gloom war-gaming may have led to a dip in the S&P 500 on Monday, the Times adds, the market rebounded a day later.

“The argument leans heavily on narrative and emotion rather than hard evidence,” a Deutsche Bank strategist told the paper. “That doesn’t mean it will ultimately be wrong, [but the] vibes-to-substance ratio is undeniably high.”

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The S&P 500 rose 0.8 percent on Tuesday, the Times notes, with firms such as IBM and Expedia (which had taken a 7 percent hit on Monday) making substantial gains.

Yet the Citrini Research piece may be hitting investors especially close-to-home amid a widespread decline in the value of software vendors—a market shift being deemed the “SaaSpocalypse” for its steep toll on software-as-a-service platforms—which has been prompted by growing suspicion among investors that all-in-one artificial intelligence products may soon be able to replace wide swaths of more narrowly-construed tech products.

Morgan Stanley’s head of global technology M&A recently speculated that the decline was, though likely overblown, nevertheless making it hard for companies to secure exits.

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