Michael Burry, the investor famed for predicting the 2008 housing crisis, is urging investors to reduce their holdings in technology stocks, citing bubble concerns. In a Substack post on Sunday, Burry warned that the current market has reached "historically dangerous" levels, reminiscent of past speculative bubbles. He advises investors to "reject greed" as excitement surrounding artificial intelligence (AI) and momentum-driven trading pushes valuations higher.
Burry specifically pointed to the rapid rise of the Philadelphia Semiconductor Index as a cause for concern. He compared the index's recent trajectory to the period before the dot-com crash in March 2000. The index, which includes companies like Nvidia, Broadcom, and Intel, has seen significant gains in 2026, fueled by investor enthusiasm for AI. Burry believes that this focus on AI resembles the final stages of the dot-com bubble.
Burry suggested that investors should reduce their exposure to tech stocks and raise cash. "An easier way for most is to simply reduce exposure to stocks, to tech stocks in particular. For any stocks going parabolic reduce positions almost entirely," he wrote. While he maintains a "significant leveraged short position" against companies he views as undervalued, he cautioned that shorting is risky and not suitable for most investors.
Burry's warnings come as major stock indexes repeatedly hit record highs, driven by investments in semiconductor makers and large-cap tech companies. He previously cautioned that tech giants are pouring trillions into infrastructure that may not deliver lasting returns.
