Contrarian stance against two of the biggest AI-fuelled stocks could be the pin that pops the bubble.
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(Image credit: Getty / Bloomberg) Scion Asset Management has disclosed that, as recently as September 30, it was betting big on the decline of AI-fuelled titans like Nvidia and Palantir. While we don’t often concern ourselves with stock market wrangling, this firm was founded and is still currently led by Michael J. Burry. The name may be familiar to moviegoers as the protagonist in The Big Short . In 2008, Burry famously predicted the seismic subprime mortgage crisis, cashing in on the ensuing financial crisis with a series of bold bets against the market.
Scion’s action, outlined today by Bloomberg , didn't come out of the blue. The founder’s personal Twitter/X account, Cassandra Unchained, forewarned that this financial strategy was unfolding last Friday – on Halloween.
Sometimes, we see bubbles.Sometimes, there is something to do about it.Sometimes, the only winning move is not to play. pic.twitter.com/xNBSvjGgvs October 31, 2025
As embedded above, Burry chilled those listening with his financial neo-Haiku. “Sometimes, we see bubbles. Sometimes, there is something to do about it. Sometimes, the only winning move is not to play.”
S&P 500 companies totalling $20 trillion in market cap have medium-to-high AI exposure
Bank of England, IMF, warn AI bubble risk has shades of 2000 dotcom crash — Goldman Sachs cautions we're not there 'yet'
Former Intel CEO Pat Gelsinger confirms the industry is in an AI bubble, but that a pop could be several years away
Sentiment regarding an AI bubble becoming ripe to burst has been growing in recent months as segment-related company values skyrocket. While many of these companies seem happy to invest billions and billions to chase the AI dream, it remains unclear how they will eventually monetize and claw back this expenditure.
News of dizzying circular deals has also raised suspicions. Recently, there have been multiple circular-feeling deals involving Nvidia at the center, like this one with xAI . Moreover, AMD and OpenAI recently signed a cozy GPU deal with stock involved.
These aren’t the charts you are looking for. You can go about your business. pic.twitter.com/ICldNUp2OI November 3, 2025
Cassandra Unchained reminded followers of these circular relationships, just a few hours ago.
According to reports in the financial press, Scion bought options in Nvidia and Palantir in recent weeks. These options have a notional value of over $1 billion, so Burry stands to win big if they pay out. However, not all Scion’s shorts are in AI-exposed businesses, as the filings show bets were also placed against the likes of Halliburton Co. and Pfizer Inc. These positions were valid as of September 30, so it is possible that Burry could have sold or adjusted these positions since then.
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Key considerations
- Investor positioning can change fast
- Volatility remains possible near catalysts
- Macro rates and liquidity can dominate flows
Reference reading
- https://www.tomshardware.com/tech-industry/artificial-intelligence/SPONSORED_LINK_URL
- https://www.tomshardware.com/tech-industry/artificial-intelligence/2008-financial-crisis-prophet-bets-against-the-ai-bubble-with-potential-usd1-billion-payout-michael-burry-reveals-put-options-on-nvidia-and-palantir#main
- https://www.tomshardware.com
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Informational only. No financial advice. Do your own research.