"Earlier this month, news emerged that Michael Burry, who famously shorted the US housing market before its collapse in 2008, had placed bets worth over $1 billion against the share prices of AI chipmaker Nvidia and software company Palantir."
"An October 27 letter Burry sent to investors, sent roughly a month after he made his short positions against Palantir and Nvidia, revealed that he would "liquidate the funds" of his hedge fund, Scion Asset Management, and "return capital" by "year's end." The leak coincided with the news that the fund had terminated its registration with the US Securities and Exchange Commission database, leading to widespread rumors that Burry was taking a step back."
"My estimation of value in securities is not now, and has not been for some time, in sync with the markets," he wrote in the letter."
Michael Burry placed more than $1 billion in short bets against Nvidia and Palantir, intensifying concerns about an AI-driven market bubble. He sent an October 27 letter stating he would liquidate Scion Asset Management's funds and return capital by year-end. Scion deregistered from the SEC database, which ends certain reporting requirements but does not necessarily mean the fund has closed. Burry acknowledged that his valuation estimates are out of sync with market prices. AI company valuations have surged despite limited revenues, with Nvidia up over 37% and Palantir up 126% year-to-date and a P/E above 200.
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