BREAKING: Investor Michael Burry, best known for his prediction of the 2008 financial crisis, has issued a stark warning that the current artificial intelligence (AI) boom represents a bubble so large it could collapse the stock market and the economy when it inevitably bursts. Burry’s alarming remarks surfaced on X late Tuesday in response to concerns about OpenAI, the company behind ChatGPT, amid reports of its escalating challenges.
Burry emphasized that while the government may attempt to intervene, the situation is “too big to save.” He stated, “The government will pull out all the stops to save the AI bubble to save the market to save the economy,” yet he remains skeptical about the effectiveness of such efforts. This warning comes as OpenAI faces fierce competition, particularly from Google’s newly launched Gemini 3, alongside soaring operational costs and legal troubles, including a lawsuit from Elon Musk.
“OPENAI IS FALLING APART IN REAL TIME,” stated former hedge fund manager George Noble, highlighting the myriad issues plaguing the AI giant. In response, Burry remarked that the massive capital being funneled into AI by the world’s richest companies will not extend the life of the bubble, describing the situation as a classic case of mania.
Burry’s concerns extend beyond OpenAI. He previously labeled the company as “the next Netscape,” referencing the infamous dot-com crash. He criticized OpenAI’s ambitious spending plans, expressing disbelief at its projected budget of $1.4 trillion over the next eight years. In a striking comparison, he noted that America’s eight most valuable tech companies—Nvidia, Alphabet, Apple, Microsoft, Amazon, Broadcom, Meta, and Tesla—are collectively valued at over $22 trillion and heavily invested in AI technologies.
This revelation raises critical questions about the sustainability of the AI market. Experts remain divided on whether the current AI boom signifies a genuine technological revolution or a temporary surge of excitement. Veteran investor and bubble historian Jeremy Grantham recently stated that the probability of an AI market crash is “slim to none,” while others, like “Shark Tank” star Kevin O’Leary, believe AI will enhance productivity and growth.
Burry’s alarming predictions resonate particularly in light of historical precedents, where the government intervened to rescue too-big-to-fail banks during the financial crisis. Such bailouts, however, sparked significant public backlash as many individuals affected by the downturn received minimal support.
As the AI landscape continues to evolve, the implications of Burry’s warning could have far-reaching consequences for investors and the broader economy. With AI technologies rapidly advancing and becoming integrated into various sectors, stakeholders must closely monitor developments in this volatile market.
In the wake of these revelations, the financial community is left to ponder: What will happen next? Will the AI bubble burst, and if so, how will it impact global markets? Stay tuned for ongoing updates as this story develops.
