Storied investor Michael Burry has talked the AI-bubble talk, and now he’s walking the walk.
Burry, made famous in the 2015 film The Big Short for his prescience on the 2008 housing market collapse, disclosed some cynical bets against tech giants Nvidia and Palantir amid concerns of AI company valuations swelling beyond their true worth.
Scion Asset Management, Burry’s hedge fund, bought more than $1 billion in put options on the two tech companies, according to regulatory filings released on Monday for the quarter ended on Sept. 30. A put refers to an options contract that allows the buyer to profit when share prices decline. Scion also disclosed call options on Pfizer and Halliburton.
Burry has offered cryptic social media posts about market omens: “Sometimes, we see bubbles,” Burry said in a recent X post. “Sometimes, there is something to do about it. Sometimes, the only winning move is not to play.”
He followed up with a post on Monday showing three graphics, including one published by Bloomberg last month depicting how much of the AI boom is being propped up by partnerships with two companies, Nvidia and OpenAI. Another graph showed similar patterns in tech capital expenditure growth between today and the dotcom era.
