Michael Burry Likens AI Boom to 1999 Dot-Com Bubble

Michael Burry, the investor famously depicted in "The Big Short," argues the current artificial intelligence frenzy mirrors the speculative mania of the late 1990s. He contends that technical and fundamental indicators suggest the market has already entered a dangerous bubble, destined to end in a significant correction.

Burry points to the massive concentration of capital in AI as evidence of an unfolding crisis. Citing data from Apollo’s Torsten Slok, he noted that 87% of venture capital funding has flowed into AI this year, a figure that dwarfs the 40% seen at the height of the internet boom in 1999. He rejects the argument that today’s market is safer because companies are more profitable, noting that venture capitalists are currently funding record numbers of loss-making entities that have yet to reach public markets.

The investor, who recently pivoted from managing a hedge fund to publishing analysis on Substack, highlighted parallels between the modern data-center rush and the aggressive global infrastructure buildout that defined the dot-com era. Beyond the capital flows, Burry questions the long-term utility of the technology, citing studies that suggest many corporate AI projects are already being abandoned. He warned that consumers have shown little appetite to pay for AI tools, and that enterprise demand may cool once the initial "FOMO" environment gives way to standard budgetary scrutiny. Describing the current landscape, Burry characterized the market as a "bloody car crash" moments before impact.