The famed investor behind the 2008 housing crash prediction is once again sounding the alarm — this time on the artificial intelligence boom he calls a “bubble.”
NEW YORK (Market Insider)— Michael Burry, the hedge fund manager immortalized in The Big Short for predicting the 2008 financial crisis, has placed a massive $1 billion short bet against two of the most high-flying names in artificial intelligence: Nvidia and Palantir.
According to a regulatory filing dated November 3, Burry’s firm Scion Asset Management purchased over $1 billion in put options—contracts that profit when share prices fall—targeting Nvidia, the world’s leading AI chipmaker, and Palantir, the U.S. data analytics company closely linked to government and military AI projects. The positions were built during the quarter ending September 30, coinciding with record highs for both stocks.
At the same time, Scion also opened long call positions—bets on rising prices—on Pfizer and Halliburton, suggesting Burry sees potential value in traditional healthcare and energy plays as investors crowd into the AI sector.
A Warning From the ‘Big Short’ Investor
Burry has been dropping cryptic warnings for weeks on social media. “Sometimes you see a bubble,” he wrote on X. “Sometimes there’s something to be done about it. Sometimes the only winning move is not to play.”
On November 3, he posted a trio of charts — one from Bloomberg highlighting how the AI rally is driven largely by partnerships centered on Nvidia and OpenAI, and another comparing the current surge in tech capital spending to patterns seen during the dot-com bubble of the early 2000s.
This isn’t Burry’s first time shorting Nvidia. Scion disclosed similar positions earlier this year but later closed most of its long holdings. The latest filing notably omits a previous disclaimer suggesting those shorts were “hedges” against unreported long positions—implying this time, Burry’s bearish stance is deliberate.
Palantir CEO Fires Back
Palantir CEO Alex Karp publicly dismissed Burry’s bet in a fiery CNBC interview, saying:
“It’s bizarre that the two companies he chose to short are the ones actually making real profits. Betting against chips and data platforms is madness. What he’s really doing is betting on the collapse of AI — and that means betting against Nvidia and us.”
Market Reaction: Tech Stocks Slide
AI stocks stumbled sharply following Burry’s disclosure. On November 4, the Nasdaq fell 2%, the S&P 500 slipped 1.17%, and Palantir plunged 16% after releasing earnings that beat revenue expectations but failed to provide strong guidance for 2026.
“The results were solid, but the market was disappointed by the lack of forward visibility,” wrote Jim Reid, strategist at Deutsche Bank, in a note to investors.
Growing Warnings of a Market Correction
Burry’s bearish move aligns with rising caution from Wall Street leaders. At the Global Financial Leadership Investment Summit in Hong Kong, Goldman Sachs CEO David Solomon warned that stocks could see a 10–20% correction within 12 to 24 months, while Morgan Stanley CEO Ted Pick added that a 10–15% pullback would be “healthy — as long as it’s not triggered by a macro shock.”
Echoes of 2008 — or 2000?
For many, Burry’s bet evokes memories of his legendary 2008 short against subprime mortgages, which earned him and his investors hundreds of millions. This time, however, his warning targets the AI-fueled market mania, where Nvidia’s valuation recently exceeded $3 trillion, making it the most valuable semiconductor company in history.
Whether Burry is once again early—or right—remains to be seen. But as the man who spotted the last great bubble before it burst, his $1 billion wager against AI’s two poster children has added new tension to an already jittery market.
Scion Asset Management declined to comment on the positions when contacted by Market Insider.
