"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... It was a negative feedback loop with no natural brake...The system turned out to be one long daisy chain of correlated bets on white-collar productivity growth."
"It's a new kind of bear case, focused not on Skynet-style misalignment but on the gradual unspooling of the economy itself. In particular, the Citrini scenario looks at the implications of integrating AI agents into the economy at large, and what it would mean when outside contractors get replaced by cheaper in-house AI. It's similar to the Death of SaaS scenario, but Citrini goes further, implicating any business model that involves optimizing transactions between companies."
Agentic AI improvements can enable firms to replace white-collar workers and third-party contractors with cheaper in-house AI agents. Resulting layoffs reduce consumer spending, creating margin pressure that pushes firms to further invest in AI, producing a negative feedback loop with no natural brake. Correlated bets on white-collar productivity growth can amplify each other, potentially doubling unemployment and cutting total stock market value by more than a third within two years. Integration of AI agents into procurement and transaction-optimization roles threatens business models reliant on inter-company transactions and outsourced services. Observers note uncertainty about how readily firms will hand off purchasing decisions to AI.
Read at TechCrunch
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