A growing number of CEOs suspect a market crash is imminent but have been “scared” to say so publicly out of fear of retaliation from President Donald Trump, and on Tuesday, one security expert warned that such a crash may not only be imminent, but “permanent.”
“If nothing is done about the current situation, Trump’s looming recession could blow a deep hole in the economy,” warned former Homeland Security senior official Miles Taylor in an analysis published Tuesday on his Substack. “So deep that – if it happens before we’re ready – many folks may never be able to crawl back out. That’s because two explosions could hit the U.S. economy at the same time.”
The first of the “two explosions,” Taylor warned, was the ongoing U.S. war against Iran, a conflict that has already sent prices skyrocketing, both domestically and abroad.
“Trump is conjuring up a recession that should’ve been avoidable, which is bad enough,” Taylor continued. “But the second explosion that could hit the economy at the same time is a different kind of weapon entirely.”
The second “explosion,” Taylor cautioned, was what he described as a “ticking time bomb,” one that he had “been hearing tick for the last three years”: generative artificial intelligence (GenAI).
The emerging technology has increasingly been adapted by American companies both large and small, with a recent survey finding that 99% of CEOs expect “AI-driven layoffs.”
Should the first economic “bomb” go off, the “second explosion” of mass layoffs would likely soon follow, Taylor warned, setting off a recession “different from all others that came before it.”
“The instant the economy turns, the cautious AI pilots will become emergency AI rollouts. Corporate boards will start demanding cost cuts, and CFOs will start drafting reduction-in-force memos,” Taylor wrote.
“Layoffs that would have been framed as long-term ‘restructuring’ or ‘right-sizing’ will become, by necessity, full-scale workforce replacement. The recession Trump is steering us into will arrive at the precise moment in history when, for the first time ever, wide swaths of the human workforce can be replaced instantly by software.”
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