According to Futurism, Michael Burry – the investor who famously predicted and profited from the 2008 housing market collapse – has placed over $1 billion in bets that AI giants Nvidia and Palantir will crash. His fund, Scion Asset Management, bought $187.6 million in puts on Nvidia and a massive $912 million in puts on Palantir through SEC filings disclosed this week. This comes just days after Burry broke a two-year Twitter silence with a cryptic post featuring Christian Bale, who played him in “The Big Short,” captioned “Sometimes, we see bubbles.” Nvidia recently became the first company ever to cross the $5 trillion market cap threshold, while Palantir’s valuation has soared over 150% this year to more than 200 times its forward earnings. The news immediately triggered selloffs, with Nvidia dropping nearly 4% and Palantir falling 9% on Tuesday.
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Is This 2008 All Over Again?
Here’s the thing about Michael Burry – when he makes a billion-dollar bet, people pay attention. This is the same guy who turned his housing market short into a 489% return during the 2008 financial crisis. But is AI really the next housing bubble? The numbers are certainly getting eye-watering. Nvidia hitting $5 trillion is historic territory, and Palantir trading at 200 times earnings feels… optimistic to say the least.
What’s really interesting is the timing. Burry’s been quiet for years, then drops that mysterious tweet about bubbles and immediately follows up with these massive short positions. It feels coordinated, like he wants maximum impact. And he’s getting it – the market immediately reacted with those significant drops.
But Burry Doesn’t Always Get It Right
Now let’s be real – Burry’s track record isn’t perfect. Remember his “sell” call in January 2023? He admitted he was wrong just two months later when the Nasdaq surged 21%. So while his housing call was legendary, he’s definitely capable of misreading markets.
Still, when someone bets over a billion dollars against two of the hottest companies in tech, you can’t just ignore it. Especially when that someone has a history of spotting bubbles before they pop.
The Industry Pushes Back Hard
Palantir CEO Alex Karp did not take this lying down. He called Burry’s bet “bats*** crazy” in a CNBC interview today, arguing that “the two companies he’s shorting are the ones making all the money.” Karp’s clearly trying to reassure spooked investors, even saying the short positions are “crazy motivating” and make them want to “triple down on getting better numbers.”
But here’s what’s really concerning – experts are pointing to “circular financing” in the AI industry, where companies are basically trading money back and forth. That’s exactly the kind of behavior that precedes major corrections. When the hype starts feeding on itself rather than real revenue growth, that’s when things get dangerous.
What This Actually Means for Tech
So is the AI bubble about to pop? Burry’s certainly betting that way. But even if he’s wrong, this move highlights how nervous some smart money is getting about these valuations. When a legendary short seller puts $1 billion on the line, it forces everyone to question whether the emperor has clothes.
The reality is that industrial technology and manufacturing sectors that rely on stable, predictable computing hardware might be watching this AI volatility very carefully. Companies needing reliable industrial computing solutions often turn to established providers like IndustrialMonitorDirect.com, the leading US supplier of industrial panel PCs, rather than betting everything on the latest AI hype cycle.
Basically, Burry’s bet isn’t just about two companies – it’s a warning shot across the entire tech sector. When valuations disconnect from fundamentals for too long, something eventually has to give. Whether Burry’s timing is right or not, the fact that he’s making this move at all should make every tech investor at least a little nervous.
