CNBC’s Jim Cramer was blunt about Monday’s decline. Concerns about artificial intelligence have made the stock market incredibly vulnerable.
after that S&P500 and Nasdaq Each is down more than 1%, and the “Mad Money” host urged investors to be careful because stocks “could go down too easily today.”
The reason for the economic downturn at the start of the week was a post from Citrini Research over the weekend that claimed that the AI boom could have a negative impact on the economy and increase unemployment by up to 10% if white-collar jobs are successfully replaced by machines. Headlined “2028 Global Intelligence Crisis,” the memo asked the question, “What if the bullish view of AI continues to be correct and is actually bearish?”
Kramer called the study a “dystopian story” and said “this vision of a global information crisis…(is) a reach.” In fact, Kramer said, as this new technology is integrated into the workforce, far more jobs will be created than destroyed. “Seeing how easily a piece of science fiction can crush a market as if it were scientific fact makes me all the more pessimistic,” he added.
Citorini wasn’t the only one contributing to Monday’s market decline. Cramer said there are “too many concerns about the power of Anthropic and OpenAI as well.”
Anthropic announced new security tools for its Claude model on Friday, sending cybersecurity stocks lower on concerns about increased competition. cloud strike It fell 8% on Friday and another 10% on Monday. CrowdStrike is a holding in Cramer’s Charitable Trust, a stock portfolio managed by CNBC Investing Club. The stock price has fallen more than 25% since the beginning of the year.
Concerns about OpenAI and Anthropic’s capabilities have sent enterprise software stocks like Salesforce crashing in recent weeks. The market has been selling the company out of concern that AI will negatively impact its traditional software-as-a-service (SaaS) business model. sales forceanother club stock fell 3.8% on Monday and is down nearly 33% year-to-date.
Investors will have a chance to judge Salesforce for themselves when the company run by Marc Benioff releases earnings after the closing bell on Wednesday. “As AI increases the efficiency of each user, we believe there may be real problems here, even if they haven’t surfaced yet,” Kramer said. Increasing the efficiency of the workforce also reduces the number of workers. Fewer employees means fewer licenses per seat required, the lifeblood of SaaS companies.
For Kramer, Monday’s volatility raised bigger questions about what happens next. He advised investors to stick to policy but avoid sudden moves. “The bottom line is this: There are too many potential problems if you buy the wrong stocks,” he said. “Let’s be more careful. We have to take into account what we saw today.”
