AI Fears Trigger Market Sell-Off: Citrini Research Report Sparks Volatility

U.S. Stock indexes experienced a downturn on February 23, 2026, following the release of a report by Citrini Research predicting an AI-driven recession in 2028. The report, outlining a hypothetical scenario of widespread white-collar job displacement and subsequent economic collapse, ignited concerns about the potential disruptive power of artificial intelligence.

Citrini Research’s ‘Global Intelligence Crisis 2028’

The report, titled “Global Intelligence Crisis 2028,” presented a scenario where the U.S. Unemployment rate rises to 10.2% and the S&P 500 index falls 38% from its 2028 peak. Citrini Research, founded in 2023 by James van Geelen and co-authored with Alap Shah of Lotus Technology Management, argues that the increasing ubiquity of AI will fundamentally alter consumer systems, potentially leading to the collapse of platform businesses like food delivery and ride-hailing services, as well as card payment systems.

The report suggests that AI’s ability to offer lower operating and payment fees will disrupt the current fee-income models of these companies. This disruption, according to Citrini, would lead to corporate cost-cutting measures, job losses, reduced consumer spending, and systemic risk within financial markets due to potential defaults on private credit.

Market Reaction and Stock Declines

The report’s release triggered a significant sell-off in several key sectors. On February 23rd, the three major U.S. Stock indexes all closed down by more than 1%. The S&P 500 Software Index plunged 3.82%, and IBM experienced its largest one-day drop in 25 years, falling 13.2% – a decline not seen since October 2000 during the dot-com bubble burst.

Companies specifically mentioned in the report, such as Uber, Mastercard, and Visa, saw their shares decline by more than 4%. Other companies impacted included DoorDash, American Express, KKR & Co, Blackstone, Uber Technologies, Mastercard, Visa, Capital One Financial Corp., and Apollo Global Management, all falling by 4% or more.

IBM’s Plunge and the Role of Anthropic

IBM’s substantial stock drop was further compounded by an announcement from Anthropic regarding its Claude Code tool. Anthropic stated that Claude Code can assist in modernizing COBOL, a dated programming language heavily used by IBM systems for large-scale transactions in government, banking, and airlines. This raised concerns about the potential for AI to replace existing software infrastructure, impacting IBM’s core business.

Expert Perspectives and Market Sentiment

Despite the market’s initial reaction, many analysts view Citrini’s scenario as a worst-case bear-market projection and unlikely to materialize. However, concerns persist regarding the potential for a slowdown in the software industry to negatively impact the private credit market, estimated at $3 trillion.

Nassim Taleb, a renowned risk theorist, added to the anxieties by warning that AI could lead to bankruptcies within the software sector.

Potential Benefits for Semiconductor Producers

Interestingly, Citrini’s report also suggested that countries heavily involved in semiconductor production, such as South Korea and Taiwan, could benefit from continued investment in AI.

The events of February 23rd highlight the growing sensitivity of financial markets to the potential risks and opportunities presented by rapid advancements in artificial intelligence.