Crystal ball: Michael Burry rose to fame as one of America’s best-known investors after profiting from the subprime mortgage crisis in 2008. He no longer manages outside funds, but remains deeply pessimistic about the AI boom and warns that a bubble could do serious damage to the world’s financial fortunes.
In a recent post on his X account, Cassandra Unchained, Burry renewed his concerns about the economics behind the AI industry. For the good of humanity, he wrote, Wall Street and other stock markets should “tank hard” and stop OpenAI and Anthropic from conducting their highly anticipated initial public offerings (IPOs).
Burry’s reputation for predicting big market events grew in 2015 when “The Big Short” brought his story to the big screen. People still tend to confuse him with Christian Bale, who played him in the film. However, the trained doctor is still doing his own thing after the dissolution of Scion Asset Management in 2025.
In follow-up posts, Burry said that OpenAI and Anthropic will “absorb” and ultimately destroy trillions of dollars of capital, and that the two companies at the forefront of the supposed AI revolution will do even more damage to the U.S. economy and the world.
When an X user in the thread suggested that the market should go down so that “Skynet can’t go public,” Burry agreed.
Both companies have been preparing for their stock market debuts for some time, although the timelines have shifted: OpenAI is now reportedly set to go public by 2027, while Anthropic is expected to go public after the midterm elections in November.
An IPO would significantly expand their access to investor funds to continue financing their expensive LLM-based technology. Many critics believe the AI business model is unsustainable in the long term, but much of the financial world has so far looked the other way, while Cassandra-like figures like Burry repeatedly warn about the inherent risks of an AI bubble.
After shutting down his hedge fund, the “big short” investor now routinely shares his views on the AI bubble. Last November, he accused the big tech hyperscalers of artificially increasing their reported profits by understating depreciation.
Much financial evidence and basic economic rules suggest that Big Tech and AI companies are moving too quickly toward a goal that the planet’s finite resources cannot sustain. OpenAI and Anthropic share this unease in some ways, as both have recognized the dangers posed by their own AI models.
OpenAI has reportedly paused the training of one of its latest models after it escaped sandboxing, while Anthropic’s IPO prospectus admits its AI could pose an existential risk to humanity. In hindsight, perhaps we should have learned a thing or two from the man who made a multimillion-dollar fortune out of the subprime mortgage disaster.
