AI Disruption Has Finally Reached Silicon Valley and Wall Street

Is Something Big Really Happening?

Why (I think) Silicon Valley and Wall Street are so terrified of disruption this time.

Software and growth stocks are getting hammered as investors price in a high likelihood of disruption from artificial intelligence (AI) across the board.

What solidified this freak-out in my mind was a viral post called Something Big Is Happening that reads like “my programming job is being replaced by AI, and you’re next.”

What’s the fuss all about? What’s signal and what’s noise?

I think we need to take a step back and look at who is being impacted by AI today and why they’re so worried. No surprise, the fear of disruption is emanating from Silicon Valley and Wall Street.

The market isn’t worried about farming jobs.

Or construction jobs.

Or manufacturing.

Or retail.

There isn’t even a good argument that your plumber is going to be replaced by AI. But the computer programmers who have been at the center of disrupting industry after industry for decades are being replaced by…computers.

Now, the shoe is on the other foot.

Something big is happening.

Job Disruption of Old

For decades, technology has impacted the job market. But those who could leverage computers and technology most effectively were the ones who got ahead. They were on the offensive.

Less technical workers — primarily located in the middle of the U.S. — were simply S.O.L. and forgotten along the way.

For decades, mining and logging jobs have been in decline.

So have manufacturing jobs, despite the U.S. producing more goods than ever, driven by “efficiency” from robotics, not more jobs.

What about retail? A segment of the economy that grows steadily year after year? There are no more jobs today than there were in 2006, thanks to Amazon and online retail.

Construction ebbs and flows, but even in the high-demand market we see today, employment is barely higher than it was prior to the Great Financial Crisis.

Where are there new jobs? Who has been on the offensive?

Wall Street itself is booming. The financialization of everything and rising markets have led to more jobs in the industry, and they’re often highly paid.

Private education and health services are the most steady growth in jobs, as an aging population is cared for through plentiful government programs.

Professional and business services are seeing strong growth too.

If you wanted increasing opportunity over the last 20 years (as far back as these BLS charts go) and really over the past 100 years, the formula was simple. Get a college degree, do some “high-value” white collar work, and get paid a good salary with ample room to move up the ladder.

Why is this relevant today?

What’s disruptive about AI is that it’s coming for the highest-paid of this growing group of white collar work first.

AI is replacing computer programmers first.

And then financial analysts.

And then lawyers.

And doctors.

Being a professional — being educated — was supposed to be the path to success and stability.

Now that footing is more unstable than ever, and given the sheer growth of the white collar market over the past 50 years, there is a long way to fall if jobs are indeed replaced by AI.

Look at the left axis on these charts. There are 8.3 million people working in construction, 600,000 in mining and logging, 12.6 million in manufacturing, and 22.4 MILLION in “professional and business services.”

I say this sitting in my home writing on a computer, very much a “professional and business services” job.

But this is the state of the job market today. For decades, getting a college degree and working in an office or as a programmer was the way to success in the U.S. and around the world.

Even when the economy hit its worst in 2009, the unemployment rate for those with a college degree was never over 5.0%. There’s never been a real fear of replacement or disruption for the educated class.

You can see why the powers that be on Wall Street and throughout Silicon Valley are nervous. What if all of these “high-value” programming and analyst jobs are replaced by AI?

What if office jobs become a prompt?

The outcry wasn’t loud when technology disrupted farming or mining or manufacturing or retail because those industries didn’t hold the purse strings.

This time, the powers on Wall Street and Silicon Valley are seeing disruption staring them in the face. And they’re selling everything indiscriminately because, as a group, they correlate the disruption of their seat at the table as a disruption that will eventually hit everyone else.

Or maybe they’re late to the disruption party.

Maybe Wall Street and Silicon Valley are just the last to face the technology disruption that other industries have been feeling for decades.

The irony is, AI’s disruption is Silicon Valley and Wall Street pulling the rug out from under themselves.

Disruption and Adaptation

As a Midwesterner, one of the things I have seen acutely is the hollowing out of parts of Middle America.

Drive through any “flyover state,” and you’ll see the impact of technology and efficiency on small towns and communities. It’s seen in abandoned homes, a lack of jobs, and an aging population in small towns.

I grew up in a small town in western Minnesota with 12 cousins and over 30 extended family members within biking distance. Today, a grand total of 1 person in my family still lives in town, and she’s approaching 90.

In cities like Detroit and Milwaukee or the mines of West Virginia, the jobs handed down from generation to generation dried up.

Heck, 150 years ago, half of the U.S. population worked in farming!

For generations in the Midwest, the trends have been clear. Opportunity wasn’t in staying on the farm (which both of my grandparents’ generation left), and wasn’t in a small town (which my generation left).

Opportunity was found by going elsewhere for education and to build a career. Opportunity was in the big city!

It’s not how my parents or grandparents envisioned our lives playing out. Just like my grandparents disappointed their parents by abandoning the farm.

But we adapted.

The way of life in the middle of America has been in a state of disruption for over 100 years.

Now, that disruption may be coming for the financial and technical hubs on the East and West Coasts, respectively. They’ve been the magnets for talent and money for a century, but now that “talent” is being replaced by AI.

It’ll take time, but they’ll adapt too.

Investing Is an Emotional Business

What does this have to do with markets?

The truth is, investing is more about psychology — at least on a short-term basis — than it is deep fundamental analysis.

And right now, the market is an emotional beast.

There’s a good reason the market and Silicon Valley are being emotional about AI. They can’t fathom that they’re the ones being disrupted and they can’t think straight.

Sell first, ask questions later.

This is different from every previous wave of automation, and I need you to understand why. AI isn't replacing one specific skill. It's a general substitute for cognitive work. It gets better at everything simultaneously. When factories automated, a displaced worker could retrain as an office worker. When the internet disrupted retail, workers moved into logistics or services. But AI doesn't leave a convenient gap to move into.

Matt Shumer’s Twitter post

Think about how ridiculous that statement is on its face.

Factory workers didn’t retrain to become office workers!

Farmers didn’t become business consultants!

And of course, there’s a gap open for displaced programmers. We need more roofers and plumbers!!

It’s emotional to see your career and what you’ve spent your life learning and building evaporate into a computer program.

Small town U.S.A. has been screaming about this for decades.

So, yes. I understand the fear in Silicon Valley. It sucks to know you’re going to be replaced by a computer sooner rather than later.

But just because some jobs are going to be replaced by computers doesn’t mean the world is going to end.

And not all stocks are going to zero either. AI will make a lot of companies more efficient.

As William Gibson said, “The future is already here – it's just not evenly distributed.“

Now, my job is to help find those long-term winners. And in general, I’m skeptical that AI will disrupt everything, as the conventional wisdom seems to believe.

All Is Not Lost

Is there a bright side?

Of course!

The reality is, most people don’t work as computer programmers or lawyers or tax professionals.

More people work in leisure and hospitality than in finance.

Healthcare shows no signs of slowing.

The beautiful thing about the U.S. economy is that it’s adaptable. People can find new opportunities.

And while millions of people may have to adapt, this is a subset of the population that’s equipped to do just that. Laid-off programmers will start new companies. They’ll make old businesses more efficient with vibe coding consulting. Maybe they’ll decide to do something else productive in the economy.

Maybe I’m naive, but I don’t think AI will do everything meaningful in life a decade from now.

The transition for many in these industries will be difficult, but people will get through it.

We always do.

And these are (supposedly) the smartest people in the world in Silicon Valley and on Wall Street. I’m sure they can be retrained to be construction workers or servers.

Uncertainty and Opportunity

As I look over the carnage that is the Asymmetric Portfolio in 2026, I’m trying to separate emotion from reality.

What’s truly being disrupted by AI or AI wielded by a competitor?

And what’s being thrown out with the disruption narrative?

I’ll delve into each company specifically over the next few weeks, but I generally feel well-positioned because the companies I own aren’t replaceable features; they’re platforms and markets that provide real goods and services to a mass market.

That said, the market sees uncertainty.

And uncertainty means lower valuations for investors.

The good news is that uncertainty and short-term decline in prices lead to greater upside opportunity for winners in the future.

We just need to keep our heads about us and not correlate the disruption at one company to the disruption for all companies.

I think that’s the mistake a lot of Wall Street and Silicon Valley are making today.

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