Michael Burry, the investor who famously shorted the housing market before the 2008 collapse, just reshuffled his portfolio again. In an August 4 Substack post, he dumped his Microsoft stake, closed his Oracle short, and covered his Palantir bet. But the real story is what he's keeping: massive shorts on Nvidia, the Nasdaq 100 tracking QQQ, and semiconductor stocks, extended now through 2027.
The moves signal Burry still expects a crash. He explicitly warned the S&P 500 could face a 1987-style plunge, even as the index hit fresh record highs this week on stronger earnings and falling oil prices. The Nasdaq jumped 2.7% in the same session. Burry isn't buying it. He argues that AI spending, which has fueled much of the recent rally, rests on unsustainable financing deals, not real economic returns.
What worries him most is the mechanics underneath. When markets rise on falling volatility, vol-targeting funds automatically pile on use. That borrowed money chases momentum, which can evaporate fast. One sharp move down forces those funds to sell at once, triggering the kind of cascade that turned 1987 into a bloodbath. Burry sees the conditions ripening again.
He still holds shorts on Tesla, Caterpillar, and Micron too. His Nvidia bet is the only position he admits looks shaky right now. Everything else, in his view, is timed right. Whether he's prescient or early remains the oldest question in markets.
This article is for informational purposes only and does not constitute financial advice. Always conduct your own research before making investment decisions.
