Michael Burry moves his AI-bubble bet into put options

The hosts say Michael Burry has covered his share-based short positions and replaced them with put options, adding leverage because weekend research moved his expected timeline forward. Burry also cited tax-loss harvesting as a partial reason for the change. The hosts read his September 28th post as a bet that the AI bubble could burst within the next year—not a claim that it has already burst.

Their examples include Micron puts expiring June 2027 with a $500 strike, Caterpillar puts expiring December 2027 with a $400 strike against a quoted $845 share price, and September 2027 positions tied to a semiconductor shares ETF, the NASDAQ 100, Palantir, and NVIDIA. They describe the NVIDIA strike as implying a drop of more than 50%. Burry also holds longer-dated MetLife puts with a $70 strike against a quoted $94 price. The hosts exclude Nebius from their core AI-bubble comparison and question why Micron expires three months before NVIDIA. Because put options lose time value as expiry approaches, one host interprets the September 2027 positions as implying a hoped-for move by June, and the Micron position as implying one by March. Those are the host’s inferences, not dates Burry explicitly gave.

Burry points to Ares Management’s analysis of $573 billion in complex financing across 26 disclosed AI projects over the preceding year. As the hosts describe it, loans, leases, GPU-backed borrowing, and guarantees connect banks, private equity firms, data-center builders, and chipmakers; weak software revenue or higher interest rates could prompt one participant to retreat and unsettle the rest. [Inferred from the image reference: an Ares Management illustration titled 'house of cards' depicts that interconnected risk.] The hosts connect this concern to Anthropic’s reported IPO urgency, while acknowledging they have heard nothing concrete. A second host notes that cooler jobs and inflation data might leave Federal Reserve rates stable, even though borrowing remains expensive. Burry is not exclusively bearish: he also bought more Sprouts around 63 and added qxl. The hosts respect the size and specificity of his bet but stress that its timing remains unproven.