Michael Burry warns AI investment mirrors 1999 dot-com bubble
Michael Burry, the guy who saw the 2008 financial crash coming, is sounding the alarm about AI investments.
He thinks today's rush to pour money into artificial intelligence feels a lot like the dot-com bubble from 1999, and he's laid out his concerns on his Substack blog.
Burry cites 38% debt, $700B AI
Burry points out that both the AI boom and the dot-com era are fueled by risky debt and tons of venture capital cash.
High-yield debt is now at 38%, almost matching levels from back then.
He also calls out how investors are backing unprofitable AI companies more than ever, with tech giants set to spend $700 billion on AI development this year alone.
Even though some people have dismissed his warnings before, Burry isn't backing down: he believes these signs could mean trouble ahead for the market.