Preparing For the Future of AI | Editorial

Editor’s Note: Any opinions expressed in City Voice articles are the authors’ own and do not necessarily reflect those of the City Voice.

Over the past few days, something has made me somewhat worried. It’s about AI, as it typically is. If you’ve been following the news at all, you may have seen a stream of articles that are talking about the AI ‘bubble’ bursting. If you read often about technology like I do, you may have noticed a changing sentiment in the way that articles are written, shifting from an AI ‘boom’ that we’re in now to an AI bubble we’re in.

Now, what a bubble means is that instead of something like a boom where AI is skyrocketing and there’s lots of investors who are trying to propel AI companies to the forefront of the stock market, all of a sudden they are pulling all their money out of those companies because they believe they’re too risky or they’re not providing enough value. And typically for these AI bubbles, that’s going to cause a crash in the stock market. Now I, as someone who is invested in the stock market, am very worried because the last time we had a bubble burst (which was the dotcom bubble), about 60 to 70% of the stock market’s value was gone. And that can hurt so many people. Not just casual investors like myself, but especially people who are saving for retirement, who are trying to afford basic necessities. And these working-class Americans are no longer going to have the funds to do so.

A few days ago, Peter Cohan, who is a senior contributor to Forbes, published an article about the AI bubble bursting, and he outlined what he thought might happen with the AI bubble. So, what he estimated is that there’s about a 35% probability that AI valuations are going to go down 60 to 70% over a two-to-three year period. And this is going to cause a slow burn. It’s not going to be catastrophic like the dotcom bubble, but it will prove that the AI bubble is real and that AI just doesn’t have the momentum to keep going year-over-year. Now, companies like Microsoft, Google, Meta, they’re not going to be impacted as much. They’ll probably still have growth year-over-year. This is because AI, while at the forefront of their companies right now, isn’t the only thing they are concerned with.

Companies like OpenAI, which is private, will be impacted more and probably will see a harsher decline over the next couple of years. He also put a 25% probability that OpenAI is not going to be able to raise enough capital to cover its $14 billion annual cash burn, which will lead to emergency measures (possibly bankruptcy or something terrible like that—at least terrible for them). This is going to be the most catastrophic outcome. It’s going to lead to a major decline in the S&P 500 and other stock market options. So, companies like Oracle and Microsoft who are heavily invested into OpenAI may need to rework their contracts, and are probably going to see some initial losses because of this. This is going to cause a recession, plain and simple. Nvidia may lose 40 to 50% of its valuation since they are so heavily invested in AI and the S&P 500 itself is going to see 20 to 30% losses which is going to be because of how much AI companies are at the forefront of the S&P 500, which is to say 75% of its recent gains.

There’s also a 40% chance that there is a more optimistic outcome, at least optimistic in the terms of investors and people who have a lot to lose. This is going to be the path where the boom continues, companies find more efficiency and growth avenues that will keep investors happy and keep those venture capital firms that are keeping them afloat happy. Now, while that sounds good because the most likely outcome in his opinion is that things will continue to grow and succeed, that’s not necessarily the case, seeing as there’s still a 60% chance in his estimations that there will be at least some kind of recession or slow burn of these AI companies. This is especially catastrophic seeing as most of the top AI companies have a lot of contracts with each other. And so if one starts to fall, all of them are going to be brought down at least to some degree. A lot of the bigger ones, like I said, Microsoft, Google, Meta, aren’t entirely AI focused companies, so they won’t be hurt as much. And those are some of the largest companies in the S&P 500. However, some like Nvidia, for example, which is the largest company in the S&P 500, are going to see much worse outcomes in his estimations because of how AI-centric they are.

A recent study from MIT saw that 95% of the 52 organizations that they had covered had achieved zero return on investment despite spending 30 to 40 billion on generative AI across more than 300 initiatives. The Anthropic CEO said that AI could wipe out half of all entry-level white collar jobs and spike unemployment to 10 to 20% in the next 1 to 5 years. Another thing to consider if you do have an entry-level position, if you are looking for entry-level positions, is that even if AI is not as good as you at your job, companies are still going to try and cost cut and you are not as important to them as AI is because you don’t have to pay AI as much. So for these positions, you may want to weigh your options. Look into other fields. Look into other positions. Just try and secure your job future because even if the AI bubble bursts (especially then), companies are going to try and minimize their costs by cutting workers that they think AI can replace.

The working class is going to be affected by this burst the most. While the people at the top will lose a ton of money, they will still have plenty. A Yale article, which I have been pulling statistics from and pulling quotes from, ends their article with a quote from the business classic Extraordinary Popular Delusions and the Madness of Crowds. It was written in 1841, but they still say it’s very applicable to the AI bubble/boom today. They end the article with a quote. “Men, it has been well said, think in herds. It will be seen that they go mad in herds while they only recover their senses slowly, one by one.”

All that to say, please take care of yourself, because the people at the top will not. So whether or not you are very ignorant to this situation or very aware, doing your own research will help greatly and make sure your future is more secure and safe because no one truly knows what’s going to happen next. And while it’s not your fault, you have to deal with the consequences.

LUKE FANN

Editor-in-Chief at The City Voice | fann-l@students.grps.org

Editor-in-Chief Luke Fann is a junior at City and freelances for Rapid Growth Media's Voices of Youth program. He also attends Michigan State University's MIPA Summer Journalism Workshop, receiving the Sparty Award in Journalistic Storytelling and the Art of Storytelling. Additionally, he recieved an Award of Excellence in the Level Up: Leadership for Media program in 2025 and earned an honorable mention for his piece on AI and LLMs at the 2024 MIPA Spring Awards.

Luke began writing in 7th grade and became an editor by the following year. By his sophomore year, he was Managing Editor and then Editor-in-Chief. As for writing, he focuses on business and technology news, taking a deeper dive into topics rather than focusing solely on breaking news. He also covers personal interests, and his weekly editorials offer unique takes on timely issues.

If you're interested in writing for The City Voice, especially as a middle schooler or Underclassman, reach out to Luke or attend a meeting. Journalism is a great way to express your passions. No matter your background, The City Voice wants to hear your voice.