Advanced AI agents could eliminate economic friction and trigger mass white-collar unemployment, leading to a catastrophic market crash by 2027, according to a scenario outlined by research firm Citrini that has already rattled investors this week. The firm’s analysis describes how increasingly capable AI agents might dismantle traditional business models, suppress wages, and create feedback loops that monetary policy cannot address.
The scenario begins with AI agents achieving a significant jump in capability, similar to recent advances demonstrated by Anthropic’s Claude Code and OpenAI’s Codex. These powerful tools could fundamentally reshape how businesses and consumers operate, according to the research.
AI Agents Disrupting Traditional Business Models
According to Citrini, advanced AI agents would first impact software-as-a-service companies by offering businesses cheaper alternatives for managing databases and organizing workflows. Companies like Monday.com, Zapier, and Asana could face significant pressure, while enterprise software providers relying on long-term contracts would enter a race to the bottom on pricing.
Meanwhile, the scenario envisions AI agents eliminating companies that monetize friction in the economy. Travel and estate agencies acting as middlemen could become obsolete as personal AI agents handle transactions directly. The research suggests that developers and consumers alike would create custom applications, fragmenting markets and destroying the margins of legacy businesses.
Additionally, ride-sharing platforms and payment processors could face existential threats. Instead of using services like Uber and DoorDash, consumers might deploy AI agents to optimize every transaction. The scenario predicts AI agents would favor cryptocurrency over traditional payment networks like Visa and Mastercard due to lower transaction costs.
White-Collar Job Losses and Economic Feedback Loops
The research warns that AI-driven displacement differs fundamentally from previous technological disruptions. Unlike past innovations that created new employment opportunities, AI represents a general intelligence that improves at the very tasks humans would redeploy to, according to Citrini.
White-collar workers would face mass unemployment and redeploy into unstable gig-economy positions, suppressing wages across the sector. The scenario describes displaced professionals from companies like Salesforce working as ride-share drivers, creating downward pressure on income levels.
However, this displacement would trigger what Citrini calls a feedback loop with no natural brake. Reduced consumer spending from unemployed workers would weaken demand, prompting companies to invest further in AI rather than human labor. The consequences become severe when the top 10% of US workers, who account for 50% of consumer spending, can no longer maintain their purchasing power.
Financial Market Contagion and Private Credit Defaults
The scenario predicts job losses would ripple through broader markets via private credit defaults and mortgage crises. Private credit firms that financed software company acquisitions based on stable long-term revenue projections would face massive defaults as AI agents undermine those assumptions.
Citrini cites the example of Hellman & Friedman and Permira taking Zendesk private in 2022 for $10.2 billion with loans structured around revenue stability. The research warns this could lead to the largest private credit software default in history, affecting life insurance policies and household savings held by asset managers.
In contrast to containable sector-specific crises, the contagion would spread as regulators downgrade software debt. Simultaneously, white-collar workers unable to make mortgage payments would trigger a housing crisis, with people unable to repay loans borrowed against futures they can no longer believe in, according to the scenario.
Ghost GDP and Social Unrest
The research introduces the concept of ghost GDP, describing output that appears in national accounts but never circulates through the real economy. While AI companies generate enormous profits and prop up market indices, government tax revenue from human labor would collapse precisely when transfer payments become most necessary.
Citrini predicts social upheaval similar to Occupy Wall Street, with protesters blockading AI company offices. The scenario culminates in a late 2027 crash wiping out 57% of the S&P 500, driven by mortgage market collapse and reinforcing spirals between credit turmoil and employment losses.
Stephen Innes, managing partner at SPI Asset Management, noted the immediate market impact of the scenario, saying the market has absorbed wars and banking tremors with ease but a widely circulated analysis was enough to knock it sideways. Shares of Uber, DoorDash, Mastercard, and American Express have already declined this week following the scenario’s publication. Whether regulators and policymakers develop appropriate frameworks before such disruptions materialize remains uncertain, though some experts question whether current AI capabilities could actually enable the scenario described.