Artificial intelligence has created a “terrifying” outlook for employment, Oaktree Capital Management LP co-founder Howard Marks cautioned, and an assumed productivity boom fails to consider how many people will be able to afford the additional goods produced.

“I’m concerned that a small number of highly educated multi billionaires living on the coasts will be viewed as having created technology that puts millions out of work,” Marks wrote in a blog on Tuesday. “This promises even more social and political division than we have now, making the world ripe for populist demagoguery.”

Some firms are having to take on “aggressive” amounts of debt because AI is a “winner-take-all arms race” and for companies like Microsoft Corp., Alphabet Inc., Amazon.com Inc., Meta Platforms Inc. and Oracle Corp. “it’s reasonable to think one of the reasons they’re spending vast sums is to make it hard for lesser firms to keep up,” Marks said.

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Investors are behaving in a “speculative” manner even though the demand growth for AI technology is “totally unpredictable,” Marks said, pointing out that Meta and Alphabet’s 30-year bonds to finance their AI investments pay about 100 basis points more than Treasuries of the same maturity.