Michael Burry, who runs Scion Asset Management and made his name betting against the US subprime mortgage market before the 2008 financial crisis, has spent close to a year warning that markets are underestimating the risk of an AI-driven correction.
His most concrete wagers emerged in a late-2025 filing disclosing put options, which profit when a stock falls, on 5 million Palantir shares and 1 million Nvidia shares, positions with a reported notional value of roughly $912 million and $187 million respectively.
That stance has shifted rather than softened through 2026.
Covered short
Burry partially covered his Palantir short in July before expanding bearish exposure to semiconductor names including Micron and Nvidia later the same month.
By September he had added fresh shorts on Micron, Nebius and Palantir alongside longer-dated puts tied to Caterpillar, the Philadelphia Semiconductor Index (SOXX), CoreWeave and others.
Also in September, he pointed to roughly $3 trillion in off-balance-sheet commitments tied to AI accumulated across nine major technology companies as evidence of mounting systemic risk, and has called the Nasdaq both "historically overvalued" and "historically top heavy."
Record levels
The S&P 500 and Nasdaq have continued to post record highs throughout the period, leaving Burry's escalating short book sitting against a market that, in his view, is pricing AI enthusiasm as though the cycle has much further to run.
The tension between record index levels and his increasingly layered bearish positions is the central dynamic Investor's Business Daily has highlighted in its coverage of his evolving stance.
