Jim Cramer isn’t shopping for into the AI doomsday situation.
At some extent when Mr. Market had gotten rattled by a viral memo from Citrini Analysis’s Alap Shah, Cramer pushed again, calling it basically a piece of “science fiction” quite than sober forecasting.
The fallout from the report was fast.
On Monday, Feb. 23, the Dow dropped 1.66%, whereas the S&P 500 and Nasdaq slid 1.04% and 1.13%, respectively, amid AI jitters.
Although we noticed considerably of a rebound on Tuesday, Feb. 24, the harm lingered. The S&P 500 Software program & Providers Index rose 1.3% on the day, however stays firmly within the crimson for the yr, down 23%.
S&P 500:+0.83% whole return YTD (as of Feb. 24 shut)
Dow:+2.31% YTD
Nasdaq 100:-1.08% YTD
Software program: iShares Expanded Tech-Software program Sector ETF-27.19% YTD (as of Feb. 23)
Supply: Slickcharts, BlackRock
Nonetheless, Cramer believes the market’s intense response to AI nervousness is, for probably the most half, ill-founded. As well as, the “Mad Cash” host factors to a rising disconnect.
On one facet of the spectrum, there are traders pricing in a situation the place AI brokers obliterate the software program, providers, and finance sectors.
On the opposite facet, the financial information isn’t pointing to a catastrophic collapse.
Nonetheless, it’s necessary to acknowledge that the selloff has enamel. Practically 30% of S&P 500 shares moved up or down by at the very least 20% over the previous three months, roughly double the 20-year common, in line with Barron’s.
Enterprise software program names like Salesforce, specifically, have been hammered and are actually buying and selling at simply 15 instances ahead GAAP earnings, in contrast with a five-year common nearer to 35 instances.
Therefore, Cramer argues that the AI concern commerce is actual, and if a science fiction narrative can cripple inventory markets, “too many issues can go flawed if we purchase the flawed shares.”
He isn’t dismissing AI know-how, removed from it, however he does query the pace of change and the accuracy of a few of the narratives being pushed, making it vital to put your bets fastidiously.
Jim Cramer argued AI fears are overblown however warned valuations might undergo.Picture by Slaven Vlasic on Getty Photos · Picture by Slaven Vlasic on Getty Photos
Cramer urges selective shopping for with valuation self-discipline at a time when traders seem like working for the exits, he famous in a current “Mad Cash” episode.
The Concern & Greed Index stands at 42, in line with CNBC, underscoring that concern stays the dominant sentiment available in the market.
Nonetheless, he isn’t shopping for the AI apocalypse situation, and that the fears of a white-coller wipeout are remarkably overblown. Nonetheless, narratives can suppress pricing multiples and overwhelm shares “with out something being flawed.”
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In essence, Cramer believes traders must be selective and keep away from overpaying for shares.
He nonetheless believes within the “pioneers of AI,” although, name-dropping Nvidia and pointing to its upcoming earnings.
Actually, relating to the AI software program narrative, CEO Jensen Huang weighed in, Reuters reported.
That stated, Cramer can be bullish on power-demand gamers comparable to GE Vernova, saying that rising AI infrastructure will entail colossal power buildouts. Additionally, he acknowledges that the cash’s been flowing into staples and well being care as defensive gamers.
On personal credit score, although, he drew a tough line.
He unequivocally said that he’s “not a purchaser” of corporations like Blue Owl after redemptions surged. For perspective, traders pulled 15.4% of belongings from one Blue Owl tech-focused fund in January, in line with Reuters.
The agency additionally completely halted redemptions in one other main retail automobile, promoting off $1.4 billion in loans to effectively handle liquidity.
Cramer didn’t mince phrases in taking down the Citrini Analysis report that jolted inventory markets.
The report, “The 2028 International Intelligence Disaster,” authored by Alap Shah and revealed on Feb. 22, 2026, makes a number of outlandish claims, envisioning a “Ghost GDP” situation inside the subsequent couple of years.
Moody’s chief economist Mark Zandi, in breaking down the state of the U.S. economic system, additionally talked in regards to the sluggishness in job progress and potential AI-driven productiveness features outpacing new job creation.
Associated: Billionaire fund supervisor drops $2.8 billion on Huge Tech shares
Cramer took challenge with how rapidly Mr. Market embraced that “dystopian story” as gospel and the pace with which it triggered a inventory market sell-off.
Listed below are the important thing takeaways from Shah’s viral memo.
AI-driven white-collar job losses will speed up, pushing unemploymentto a gobsmacking 10.2% by June 2028 (fictional situation).
“Ghost GDP” emerges, led by sturdy productiveness and headline progress, however decrease client spending, considerably impairing the U.S. consumption engine, driving practically 70% of GDP.
Agentic coding instruments, together with Claude Code and Codex, will hit software program and SaaS firms, triggering intense pricing stress and renewal reductions.
Per Shah’s fictional situation, the S&P 500 tanks 38% from October 2026 highs, with an much more worrying GFC-style bear case.
Supply: Citrini Analysis
As Cramer factors out, most of the claims don’t maintain up in opposition to actuality at this level.
An enormous a part of the place the analysis falls aside is the opposite proof we’ve seen from job platforms and surveys.
As an illustration, a current NBER working paper surveying practically 6,000 executives throughout the U.S., U.Ok., Germany, and Australia discovered that greater than 90% reported no employment impression from AI up to now three years, with 89% of them seeing no productiveness impact.
Furthermore, executives forecast employment numbers to drop simply 0.7% over three years, which is significant however nowhere close to the mass unemployment situation painted by Shah. Additionally, Certainly’s Hiring Lab exhibits AI talked about in simply 4.2% of postings, with general hiring numbers rising modestly over pre-pandemic ranges.
On prime of that, new roles are being created by AI, with LinkedIn exhibiting greater than 600,000 new data-center jobs globally.
An enormous a part of Shah’s report targeted on an economic system formed by AI brokers, however even on that entrance, the numbers don’t fairly add up.
Right here’s what Certainly CEO Chris Hyams has to say, as reported by Fortune.
Moreover, a July 2025 METR research confirmed that skilled software program builders who used AI instruments took 19% longer to wrap up their duties as a result of errors and oversight necessities.
Even frontier brokers confirmed practically 50% job reliability, which is remarkably behind the 99% consistency enterprises require.
Throw within the restricted transparency round security testing, and the AI agent-led economic system narrative falls flat.
Reddit consumer Aggressive-Bedroom82 even sounded off in a scathing put up on r/aiagents titled, “Why Is Everybody Mendacity About AI Brokers?”
Associated: Cathie Wooden buys $3.5 million in Nvidia-backed inventory forward of earnings
This story was initially revealed by TheStreet on Feb 25, 2026, the place it first appeared within the Investing part. Add TheStreet as a Most popular Supply by clicking right here.