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Generated Title: Michael Burry's AI Puts: Genius Move or Just Noise?
Alright, let's talk about Michael Burry. The guy who called the housing crash – you know, The Big Short guy. Now he's betting against AI darlings Nvidia and Palantir. Big positions, too. We're talking millions in put options. Five million on Palantir alone. That's not pocket change.
Burry's Bearish Bets: A Deep Dive
Scion Asset Management's latest 13F filing is raising eyebrows. A massive $912.1 million bearish position in Palantir and $186.58 million against Nvidia. The timing is interesting, to say the least. PLTR stock is at all-time highs. NVDA isn't exactly slacking either, up over 1,200% since early 2023. Is Burry seeing something the rest of us are missing, or is this just another contrarian play? Michael Burry Is Super-Bearish On Palantir — With 5 Million Puts - Palantir Technologies (NASDAQ:PLTR)
He's not just throwing money at puts, he's also been hinting at an AI bubble on X (formerly Twitter, of course). Referencing Star Wars and posting charts comparing current AI spending to the dot-com bubble. It's classic Burry – cryptic, a little theatrical, and designed to get people talking. The charts he posted compare Cloud segment growth for Alphabet, Amazon and Microsoft in 2018 through 2022 with the present period, and AI capex matching the tech spending of the 1999-2000 tech bubble. It’s a clear signal: he sees parallels between now and then.
But here's where it gets interesting. Burry's been bearish before. He even famously tweeted "Sell" back in early 2023, then vanished from the platform. (The tweet that sent shockwaves through Wall Street). This time, he's back with the "Cassandra Unchained" moniker – a nod to the Greek myth of the prophetess cursed to be right but never believed. Is he genuinely concerned about a market correction, or is he just playing a character?
Portfolio Shuffling: Beyond the Headlines
It's not just about the AI shorts, though. Scion's also been busy reshuffling its portfolio. Adding positions in Lululemon, Molina Healthcare, and SLM Corp. Plus, big call positions in Halliburton and Pfizer. 2.5 million calls on Halliburton and six million on Pfizer. A clear shift towards defensive sectors. He also closed positions in Estee Lauder, Regeneron Pharmaceuticals, MercadoLibre, and UnitedHealth Group.
Now, let's be clear: a 13F filing only gives us a snapshot in time. We don't know when Burry initiated these positions, or what his strike prices are. (The devil's always in the details with options). It's entirely possible he's already adjusted his positions since the filing date.
And this is the part of the report that I find genuinely puzzling. Burry's been known to change his tune quickly. Remember when he swapped bearish put options on six stocks for bullish call options on nine stocks just last year? The notional values of those positions were $186 million and $522 million, respectively. Peter Mallouk, the president and CEO of Creative Planning, even said he had gone "from a strong conviction bet on a sector fall to a broad-based bet the bull run will continue." So, which is it? Is Burry a perma-bear, or a tactical trader?
Here's my take: Burry's not necessarily making a long-term bet against AI. He's making a short-term bet that the market has gotten ahead of itself. The AI hype is real, but valuations are stretched. Nvidia's market cap, for example, hit $5 trillion recently. That's a lot of future growth priced in.
The question is, can Nvidia and Palantir deliver on those expectations? Palantir, in particular, has always been a bit of a black box. Their technology is impressive, but their financials haven't always justified the hype. (And their government contracts are a whole different can of worms). Maybe Burry's betting that the market is finally starting to see through the smoke and mirrors.
And what about the broader market context? Inflation is still sticky, interest rates are high, and the Fed is still talking about further tightening. All of that creates a less-than-ideal environment for high-growth tech stocks. Burry might simply be positioning himself for a broader market correction, using Nvidia and Palantir as proxies.
The Charts Don't Lie... But They Can Be Misleading
Ultimately, Burry's moves are a reminder that even the smartest investors can be wrong. He's been wrong before, and he'll be wrong again. The key is to understand his rationale, analyze the data, and make your own decisions. Don't just blindly follow the "Big Short" guy. Look at the numbers, do your homework, and decide for yourself if the AI boom is sustainable, or just another bubble waiting to burst.
