Michael Burry, who became famous for betting against the housing market before the 2008 crash, is now raising alarms about what he sees as the AI boom’s social consequences.
In a Substack post, the investor portrayed in “The Big Short” said he was “righteously indignant over the wealth transfer to the very few that these bubbles create.”
According to Burry, practices ranging from “circular financing among tech companies” to “schemes emanating from Washington DC” are fueling “this extreme enrichment of the lucky few.”
Meanwhile, much of the economy is “existentially worried about grocery and gas prices.” He described the contrast as “hemlock to the health and longevity of the free Republic.”
He added: “The whole system is about creating bubbles so the grift can happen.”
The rush of investment into AI has directed enormous sums toward a relatively small group of chipmakers, cloud providers, model developers, and data-center operators.
Companies are competing to obtain advanced chips, expand computing capacity, and secure access to power, while investors have driven valuations sharply higher for firms viewed as central to the buildout. Nvidia, the AI industry’s largest chip supplier, has seen its market capitalization climb about 1,200% to more than $5 trillion since ChatGPT launched in late 2022.
The AI boom has also created intense competition for technical talent. An analysis by Themoneytimes of federal visa filings found that OpenAI listed base salaries reaching $530,000 for technical staff, while Anthropic research engineers could earn as much as $690,000.
In follow-up posts on X, Burry repeated the warning, describing it as “poison” to the republic’s health and “the ongoing bastardization of its very existence.”
One follower responded that the dynamic would eventually lead to serious social conflict and unrest.
Burry agreed with another follower who said human cruelty and conflict are nothing new, but argued that technology is making the problems worse. “We should be getting better,” he wrote. “Instead, technology is enabling worse.”
Asked how younger generations might react to an eventual reckoning, Burry said “youthful nihilism is peaking again,” describing the current version as “less playful, more existential.”
Burry has repeatedly challenged the AI trade in public. He has previously accused major technology companies of manipulating depreciation schedules to make earnings look stronger and disclosed bearish positions against firms including Palantir and Nvidia.
On Monday, he dismissed calls from AI leaders for a slowdown in development as “self-serving,” arguing that the push benefits established companies and generates hype ahead of IPOs rather than reflecting genuine safety concerns.
Scion Asset Management, Burry’s former hedge fund, deregistered as an investment adviser with the SEC last year, ending the routine public disclosures that had provided insight into its portfolio. Burry now discusses some of his holdings through Substack and X.