Known for predicting the 2008 housing market bubble, which inspired a book and a film titled "The Big Short," Michael Burry expanded his fame in the following years by expressing his controversial opinions about the financial market and the world of investments.

This week, he once again exercised his "crystal ball" through his newsletter on the Substack platform . And he returned to a recurring topic in his predictions: the comparison between the current frenzy surrounding artificial intelligence (AI) and the dot-com bubble of the late 1990s.

“History is not a perfect guide, but I see many indicators, both technical and fundamental, converging on the same conclusion,” wrote Burry, noting that the hype surrounding AI is a replica of what internet companies experienced almost thirty years ago.

“The 1999 market went where no other market has ever gone before. And I would say this one can go too. It’s already getting there, according to several indicators,” he continued, revealing that he had bought more shares of Adobe, PayPal, and Lululemon . And adding a series of parallels between the two periods.

“These actions are part of the mass collapse that is happening away from the main focus,” Burry stated. “In 1999, this also happened. The old economy and international investments were simply discarded in favor of the all-American bubble.”

He then cited Torsten Slok, partner and chief economist at Apollo Global Management , who, in a recent note, said that 87% of venture capital funding was allocated to AI in 2026. He added that, in 1999, the volume allocated to internet companies was less than 40%.

In another piece of data, Burry pointed out that a similar rate of issuance of high-risk bonds is related to AI, just as it was with the technology, media, and telecommunications sectors at that time.

“High-yield debt at 38% today, compared to 40-50% back then, contradicts the idea that today’s AI debt issuance is cleaner, backed by more profitable companies,” he wrote. “It’s simply an asset bubble, pure and simple.”

He also countered arguments that the AI boom is not like the dot-com bubble because there are more profitable companies being funded today than in that period, by pointing out that today, venture capital funds are funding loss-making companies like never before in history. And much more than in 1999.

"When people talk about loss-making dot-com companies, they not only ignore the fact that the biggest cash flow machines at the time – telecom and cable TV companies – were part of the bubble," he stated.

He continued: "They also ignore the fact that, this time, there are many more loss-making companies losing much more money, but they haven't gone public."

Burry further noted that, just like the current race for data centers, the turn of the millennium was marked by discourse about the need to expand global infrastructure to support and keep pace with the development of the internet.

At the same time, he questioned whether companies' demand for this technology will grow in the coming years or decline due to issues such as recession, wars, and annual budget revisions, driven by the "fear of missing out" on this trend.

On the other hand, the investor said that consumers have shown no willingness to be significant sources of revenue for AI products, given that they can use tools like ChatGPT for virtually everything, "for free or almost free".

In another post on the platform earlier this month, Burry had already issued other warnings about this rush, highlighting that this boom was heading towards an end as catastrophic as the dot-com bubble.

“The market has already gone too far,” he wrote at the time. “The end of this is near. All of this is the scene of a bloody car accident, minutes before it happens.”