Jim Cramer isn’t shopping for into the AI doomsday state of affairs.
At some extent when Mr. Market had gotten rattled by a viral memo from Citrini Analysis’s Alap Shah, Cramer pushed again, calling it primarily a piece of “science fiction” reasonably than sober forecasting.
The fallout from the report was speedy.
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 injury lingered. The S&P 500 Software program & Providers Index rose 1.3% on the day, however stays firmly within the crimson for the 12 months, down 23%.
2026 scorecard: shares, tech, and AI up to now
- 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
However, Cramer believes the market’s intense response to AI nervousness is, for essentially the most half, ill-founded. As well as, the “Mad Money” host factors to a rising disconnect.
On one facet of the spectrum, there are buyers pricing in a state of affairs the place AI brokers obliterate the software program, providers, and finance sectors.
On the opposite facet, the financial knowledge isn’t pointing to a catastrophic collapse.
Nonetheless, it’s vital to acknowledge that the selloff has tooth. Almost 30% of S&P 500 shares moved up or down by no less than 20% over the previous three months, roughly double the 20-year common, in response to Barron’s.
Enterprise software program names like Salesforce, particularly, have been hammered and at the moment are buying and selling at simply 15 occasions ahead GAAP earnings, in contrast with a five-year common nearer to 35 occasions.
Therefore, Cramer argues that the AI worry commerce is actual, and if a science fiction narrative can cripple inventory markets, “too many things can go wrong if we buy the wrong stocks.”
He isn’t dismissing AI know-how, removed from it, however he does query the velocity of change and the accuracy of among the narratives being pushed, making it important to position your bets fastidiously.
Jim Cramer argued AI fears are overblown however warned valuations may undergo.
Photograph by Slaven Vlasic on Getty Photos
Selective shopping for, strict self-discipline, and one clear crimson flag
Cramer urges selective shopping for with valuation self-discipline at a time when buyers seem like working for the exits, he famous in a current “Mad Money” episode.
The Worry & Greed Index stands at 42, in response to CNBC, underscoring that worry stays the dominant sentiment out there.
However, he isn’t shopping for the AI apocalypse state of affairs, and that the fears of a white-coller wipeout are remarkably overblown. Nonetheless, narratives can suppress pricing multiples and crush shares “without anything being wrong.”
Extra AI Shares:
- Morgan Stanley units jaw-dropping Micron value goal after occasion
- Financial institution of America updates Palantir inventory forecast after personal assembly
- Morgan Stanley drops eye-popping Broadcom value goal
In essence, Cramer believes buyers 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.
In actual fact, relating to the AI software program narrative, CEO Jensen Huang weighed in, Reuters reported.
That mentioned, Cramer can also be bullish on power-demand gamers corresponding 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 acknowledged that he’s “not a buyer” of companies like Blue Owl after redemptions surged. For perspective, buyers pulled 15.4% of property from one Blue Owl tech-focused fund in January, in response to 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 calls out dystopian AI report shaking markets
Cramer didn’t mince phrases in taking down the Citrini Analysis report that jolted inventory markets.
The report, “The 2028 Global Intelligence Crisis,” authored by Alap Shah and printed on Feb. 22, 2026, makes a number of outlandish claims, envisioning a “Ghost GDP” state of affairs throughout 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 development and potential AI-driven productiveness beneficial properties outpacing new job creation.
Associated: Billionaire fund supervisor drops $2.8 billion on Huge Tech shares
Cramer took subject with how rapidly Mr. Market embraced that “dystopian tale” as gospel and the velocity 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 state of affairs).
- “Ghost GDP” emerges, led by strong productiveness and headline development, however decrease client spending, considerably impairing the U.S. consumption engine, driving almost 70% of GDP.
- Agentic coding instruments, together with Claude Code and Codex, will hit software program and SaaS corporations, triggering intense pricing stress and renewal reductions.
- Per Shah’s fictional state of affairs, the S&P 500 tanks 38% from October 2026 highs, with an much more worrying GFC-style bear case.
Supply: Citrini Analysis
The information don’t again the AI collapse narrative
As Cramer factors out, lots 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 almost 6,000 executives throughout the U.S., U.Ok., Germany, and Australia discovered that greater than 90% reported no employment impression from AI prior 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 state of affairs 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 displaying greater than 600,000 new data-center jobs globally.
An enormous a part of Shah’s report centered 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 consequence of errors and oversight necessities.
Even frontier brokers confirmed almost 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 publish on r/aiagents titled, “Why Is Everyone Lying About AI Agents?”
Associated: Cathie Wooden buys $3.5 million in Nvidia-backed inventory forward of earnings
