Beary Michael Burry Waves The Red Flag Again But These 5 Charts Suggest The Market Isnt Crashing Yet

Burry’s full-cash stance echoed Warren Buffett’s “be fearful when others are greedy.” Still, it meant forgoing gains as the bull market continued. The platform added millions of users quarterly, with revenue exploding 200% year-over-year from options trading. Robinhood’s stock had debuted at $38 in July 2020; by February 2021, it was trading around $50, despite volatility. His warning captured real risks—such as margin debt at record levels—but it arrived as vaccines were being rolled out. Weeks later, GameStop exploded anew, surging another 1,000% in a second wave of short covering, driven by persistent Reddit enthusiasm.

Long Positions Disclosed

Can his warning be taken at face value or just shrugged off as an attention-seeking gimmick? Then he took potshots at Nvidia for its stock-based compensation accounting. For market participants, this represents an opportunity to reassess their own assumptions and ensure their portfolios are positioned appropriately for whatever comes next. Whether this proves to be another prescient call that cements his legacy or another recent misstep from a legendary investor remains to be seen. This demonstrates that he’s not simply bearish on the entire market, but instead has specific concerns about AI-related valuations. This strategy provides leverage and defined risk, allowing him to tap prominent positions without unlimited downside exposure.

Today, according to Burry, over half of the money invested in the stock market is passive. Now, Burry seems mainly concerned not just about market froth and excessive exuberance over artificial intelligence, but also the structure of the stock market, which has shifted from more actively managed a few decades ago to being very passive. Even when Burry turned out to be right and made tremendous profits for his investors, during the recent interview, he said that nobody called to apologize, but also that he didn’t expect anyone to, either. No longer a fund manager, Burry isn’t pulling any punches — and his warning to Wall Street couldn’t be any clearer. Recently, though, Burry has made a big change, shutting down his fund, Scion Asset Management, and launching a Substack newsletter. If stocks plunge and growth tanks, veteran commentators who’ve been blowing the whistle on sky-high valuations and macroeconomic headwinds might feel vindicated.

March 2021: Bitcoin’s Speculative Bubble Confirmed

This isn’t a hedge or a minor contrarian position—this is a concentrated bet that reflects deep conviction about future market direction. Combined, these two positions represent about $1.1 billion in bearish bets, accounting for approximately 80 percent of Scion Capital’s entire portfolio. Burry purchased put options on one million Nvidia shares, valued at approximately $186.6 million, and put options on five million Palantir shares, worth roughly $912.1 million. The filing disclosed that Burry has taken substantial put option positions on Nvidia and Palantir Technologies, two companies at the forefront of the artificial intelligence revolution.

Michael Burry Warns Current Market Risks May Exceed 2000 Bubble

Investor Michael Burry believes current market risks are high. Get curated U.S. market news, insights and key dates delivered to your inbox. Burry’s bet isn’t a market timer’s crystal ball—it’s a risk management tool. The Nasdaq’s 39% surge in 2023 (driven by AI stocks) has raised red flags. These strikes were slightly out-of-the-money at the time, suggesting Burry anticipated a 20%+ decline in major indices—a move that would mirror his 2008 housing crisis prediction.

• Burry’s position, now public knowledge, faced intense scrutiny, with short sellers collectively losing billions.
• Since then, stocks have rebounded and resumed a broadly upward trajectory, punctuated by brief, intermittent pullbacks within the larger uptrend.
• Now, I think the whole thing is just going to come down, and it will be very hard to be long stocks in the United States and protect yourself.
• Spot platinum was up 2.1% to $2,272.55 per ounce after hitting an all-time high of $2,918.80 on 26 January, while palladium added 0.7% at $1,787.55.
• Today the market has institutional ETFs, greater liquidity depth, and better regulatory infrastructure.
• The Scion Asset Management chief sounded the alarm in 2021 on the "greatest speculative bubble of all time in all things" and declared that buyers of meme stocks and cryptocurrencies were barreling toward the "mother of all crashes."

Michael Burry Warns Of A Market Crash Worse Than 2000, Says Brutal Selloff Is Coming

• One option is to shift funds to a more conservative investment strategy, such as investing in an equal-weighted ETF following the S&P 500 index, which removes the weighting of stocks in the S&P 500 and therefore has less exposure to the high-flying AI companies.
• He described a world teetering on the edge of catastrophe, warning that “every bit of my logic is telling me that a global financial meltdown is coming, and that it will be followed by a worldwide political meltdown as well.”
• Burry warned that if dropping to around $70,000 was pushing down the prices of more traditionally solid investments such as gold and silver, it could get even worse if Bitcoin slid down to $50,000.

Investors who heeded his signal might have liquidated positions or shifted to cash, expecting a replay of 2008. He described a world teetering on the edge of catastrophe, warning that “every bit of my logic is telling me that a global financial meltdown is coming, and that it will be followed by a worldwide political meltdown as well.” Yet, in the years following that triumph, Burry’s public pronouncements have often veered into a pattern of repeated warnings about impending doom—warnings that have yet to materialize in the way he anticipated. However, there are some who are quite pessimistic about the future value of Bitcoin as Clem Chambers of Forbes predicted that the crypto would crash to around $60,000 and could then slide further into values of around $40,000. Burry warned that if dropping to around $70,000 was pushing down the prices of more traditionally solid investments such as gold and silver, it could get even worse if Bitcoin slid down to $50,000. The famous investor wrote that Bitcoin had dropped around 40 percent in value since the October peak and had even worse words for the possibility that the price might plunge even further.

Are Ai And Tech Stocks Creating A Dangerous Bubble?

The investing world is once again paying close attention to Michael Burry, the legendary investor who famously predicted and profited from the 2008 housing market collapse. Over half of U.S. equities are in passive funds, leaving few active investors to stabilize the market. Amid 2022’s bear market—where the S&P 500 fell 20%—Burry ramped up doomsaying in 2022, forecasting “more failures coming” in stocks and banks, with bottoms far off. He liquidated nearly all Scion’s positions, holding just one stock, and tweeted warnings of retail-driven losses on a country-sized scale.

Bitcoin peaked in value in early October 2025 at around $124,000, but since then, the price has tumbled significantly and now sits at just over $70,000, with Forbes declaring ‘finally the crash is here’ for the cryptocurrency. Spot platinum was up 2.1% to $2,272.55 per ounce after hitting an all-time high of $2,918.80 on 26 January, while palladium added 0.7% at $1,787.55. The value of the crypto market now stands at nearly $2.5 trillion, down from its over $4 trillion valuation in October. Citing data from Polymarket, a prediction platform, the report adds that there is an 82% chance that Bitcoin will fall to $65,000 in 2026. Several other analysts have echoed Burry’s warnings.

• Burry’s exit from SPY/QQQ and pivot to shorting the semiconductor ETF (SOXX)—a key tech enabler—suggests skepticism about overvaluation.
• However, there are some who are quite pessimistic about the future value of Bitcoin as Clem Chambers of Forbes predicted that the crypto would crash to around $60,000 and could then slide further into values of around $40,000.
• In a world of endless rallies, Burry’s cautionary voice persists, waiting for the crash that feels inevitable—whenever it arrives.
• At the time, Tesla shares were still doubling every few months, propelled by inclusion in the S&P 500 and record deliveries.
• Burry’s strategy hinges on put options on the SPDR S&P 500 ETF (SPY) and Invesco QQQ Trust (QQQ), with a notional value of $886 million and $739 million, respectively.

The Scion Asset Management chief sounded the alarm in 2021 on the "greatest speculative bubble of all time in all things" and declared that buyers of meme stocks and cryptocurrencies were barreling toward the "mother of all crashes." He said that, while the overall stock market could head higher, a rotation out of riskier, pricier stocks like Nvidia and into defensive stocks was "more likely now than any other time over the past couple of years." This factor could lead to sector rotation out of current market leaders and into laggards such as small-caps and interest-rate-sensitive stocks.

What his positioning does suggest is that serious investors with proven analytical capabilities see meaningful downside risk in AI valuations at current levels. His track record demands attention, but timing market corrections is notoriously difficult even for the most skilled investors. Many internet companies that failed during that crash were working on legitimate business models, but their stock prices had run too far ahead smartytrade review of reality. Put options give the holder the right to sell shares at a predetermined price, making them profitable when stock prices decline.

As a consequence of this Michael Burry of The Big Short fame has been warning that the crypto crash may have been causing more problems for the economy as investors might be selling off other assets to cover their positions. During his interview with Lewis, Burry said he shut down Scion because he is worried about the stock market, which he believes could experience a prolonged downturn, a scenario he doesn’t want to have to relive while running a fund with investors. Nobody can know whether more stock market pain lies ahead or the economy is about to tank — but investors have definitely been warned about stormy times ahead. The barrage of bad news has spurred investors to hammer high-flying stocks such as Tesla and Nvidia and virtually erase the main US stock indexes’ progress since November’s election.