It was the largest workforce reduction, as a share of total headcount, in S&P 500 history.
Earlier this year, financial services company Block cut 40% of its workforce in a single round of layoffs.
It escaped many people’s attention because it happened just two days before the outbreak of the Iran war, which overshadowed it.
Here’s the key part of Block CEO Jack Dorsey’s announcement:
“We’re not making this decision because we’re in trouble. Our business is strong, gross profit continues to grow. But something has changed. We’re already seeing that the intelligence tools we’re creating and using paired with smaller and flatter teams are enabling a new way of working, which fundamentally changes what it means to build and run a company. And that’s accelerating rapidly.”
It was an astonishing example of how the artificial intelligence (AI) productivity shock is already here… and accelerating faster than most people can comprehend.
Block is using AI to become radically more productive… doing more with less and increasing its margins as a result.
Dorsey could have made the cuts gradually, but that would have demoralized the remaining employees and caused the company to act inefficiently, upsetting shareholders. Instead, he chose to make the cuts all at once rather than stretch the process out.
The markets seemed to agree with Dorsey, as Block shares surged nearly 25% after the shock announcement.
Block was just the beginning.
PayPal, Meta, and Coinbase have all announced significant AI-related workforce reductions following Block’s announcement.
- PayPal plans to cut 20% of its workforce—nearly 4,800 employees.
- Meta is laying off 10% of its staff, around 8,000 employees, as it reallocates resources toward an “AI-first” structure.
- Coinbase is reducing headcount by 14%, or approximately 700 employees.
I think there’s an excellent chance this trend snowballs from here.
We could soon see AI automate millions of white-collar jobs.
What will happen to these people?
How will it affect the political landscape?
What is going to happen to their mortgages, car loans, credit card debt, student debt, and other liabilities?
How will the US government deal with the lost tax revenue?
All of this could have enormous consequences for financial markets and the debt-ridden fiat currency system.
This is not some theoretical issue in the distant future. It is happening right now.
AI and its effects have not escaped the notice of the Federal Reserve.
Kevin Warsh is now the new Chair of the Fed. He is a major proponent of lower interest rates and monetary stimulus to counteract the effects of AI.
In other words, Warsh is essentially signaling that he will debase the currency in a misguided effort to offset AI’s deflationary effects. The problem is that the effects of AI are going to be so profound that the level of currency debasement Warsh would have to engage in would be staggering.
I believe the gap between natural deflation from AI and other technology, and forced inflation from central banks, will produce the greatest wealth transfer in history.
Wealth is not going to vanish.
It is simply going to change hands…
From those who do not understand what is happening… to those who do.
In fact, this historic transfer of wealth is already underway, and for most people, it could be financially devastating.
Consider that the US recently experienced the most severe bout of inflation in 40 years. That means the government has been printing so much money that even the most revolutionary technologies of recent years—the internet, smartphones, social media, advanced computing, and more—have not been enough to bring down the cost of goods and services in the face of rampant currency debasement.
With AI, I believe we are going to see this dynamic on steroids.
Most people are going to be squeezed in a tightening vice—on one side by the most deflationary technology in human history, and on the other by the most severe currency debasement of their lifetimes.
But for a small, prepared group who understand what is coming and take the proper actions, it could be the fortune-building opportunity of a lifetime.
If most people are going to be squeezed between AI-driven disruption and relentless currency debasement, then simply hoping things go back to normal is not a plan.
The key is to understand what is happening before the crowd does—and to take practical steps while there is still time.
That’s why I’ve prepared a special report called The Most Dangerous Economic Crisis in 100 Years… the Top 3 Strategies You Need Right Now.
It explains the economic, political, technological, and cultural trends already unfolding… the risks they could pose to your money and personal freedom… and the three strategies I believe are most important right now.
