"Doomsday is Coming"! The Real-Life Model of "The Big Short" Becomes a Clown to Issue Most Alarming Warning, Fully Increasing Short Positions on AI and Chip Stocks
According to Zhichong Finance, last Tuesday, Michael Burry, the figure who inspired the movie "The Big Short," unveiled a series of new short bets on AI and declared that South Korea's massive investment was "the beginning of the end." Just days later, he escalated his warning further over the weekend, directly quoting the Joker's line from the movie "Batman"—"The end is nigh"—and added valuation charts, taking his bearish stance on the artificial intelligence (AI) craze to new heights.
Last weekend, Burry posted the classic Joker line by Jack Nicholson from Tim Burton's 1989 "Batman" on social platform X: "The end is nigh. Have you ever danced with the devil in the pale moonlight?" Previously, he had written, "The AI narrative is just popular addiction," warning that "the AI narrative may die by a thousand cuts, and so far I've only seen a few dozen."
Alongside the Joker post, Burry shared several charts highlighting two major concerning signs. One chart, citing UBS data, shows that AI semiconductor stocks have dramatically outperformed two benchmarks—hyperscale cloud providers funding AI infrastructure, and the broader group of AI beneficiaries.
Another chart shows that the Philadelphia Semiconductor Index is currently trading near the top of its valuation range over the past 15 years, whether measured by absolute value or relative forward P/E ratio.
This aggressive stance came right after he significantly increased his short bets on AI. According to previously released information, Burry's latest short targets include Tesla (TSLA.US), Caterpillar (CAT.US), Applied Materials (AMAT.US), and the semiconductor ETF tracking chip manufacturing companies—iShares (SOXX.US). He has adjusted his put options on SOXX—from his earlier bet that the index would drop further from its January peak to now setting the exercise conditions on a roughly one-third decline by March. Burry comments: "SOXX itself is a purely overvalued index format, a rare form that has never been so easy to identify."
The direct trigger for his new round of action was reports that Samsung (SSNLF.US) and SK Hynix plan to invest over $500 billion to build a chip industry hub in South Korea. The day after the news broke, chip stocks drove the Nasdaq higher, but Burry commented: "What I see is the beginning of the end."
He also targeted Caterpillar, without going into detail, but noted that the company's equipment is used in the construction of data centers and chip manufacturing centers, with its stock price having climbed steadily in recent months. For the bearish position on Tesla, he set a target price of $416.22. In addition, Burry has also increased his months-long short position on Nvidia.
As early as last November, Burry disclosed his bets that Nvidia and Palantir (PLTR.US) would see their stock prices fall sharply by 2027, though for different reasons: he believed Nvidia was providing financing to some major clients through circular financing arrangements, which could trigger a dot-com-bubble-like crash; Palantir, on the other hand, was seen as overly reliant on government contracts and facing the risk of being replaced by competitors.
So far, Nvidia's share price has fallen about 5% since he announced his short position, while Palantir has dropped around 40%. At the time, these short bets drew sharp criticism—Nvidia denied any problems with its financing arrangements, while Palantir CEO Alex Karp bluntly called Burry "insanely wrong" in an interview.
Regarding the latest short actions, neither Burry nor the related companies have responded to requests for comment.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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