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  • ‘Big Shot’ Michael Burry’s AI bubble warning also extends to crypto: Expert

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    After popular investor and hedge fund manager Michael Burry warned a bubble is forming in the artificial intelligence (AI) sector, an AI entrepreneur has warned that the crypto market has entered a “casino reality.”

    Burry, popular for shorting the housing market bubble collapse in 2008, recently cautioned traders against an AI bubble and singled out, in particular, Nvidia (Nasdaq: NVDA), Meta (Nasdaq: META), Oracle (NYSE: ORCL), and Palantir Technologies (Nasdaq: PLTR).

    Related: Economist sends startling warning after ‘Big Short’s AI call

    The 2008 episode was the subject of the Hollywood film The Big Short (2015) in which actor Christian Bale played Burry. The legendary trader had shorted overvalued sectors earlier too, such as shorting the dot-com bubble burst in 2000.

    Michael Burry, former head of Scion Capital Group LLC, works in his office in Cupertino, California, U.S., on Monday, Sept. 6, 2010.

    But Burry has now deregistered his hedge fund, Scion Asset Management. He said:

    “My estimation of values in securities is not now, and has not been for some time, in sync with the markets.”

    Eric Balchunas, the senior ETF analyst at Bloomberg, responded to the development and said nobody, including those who get portrayed by Christian Bale, knows the future.

    Ahmad Shadid, founder of O Foundation, a Swiss-based AI research lab echoed similiar sentiments but about the rallying crypto market which has come to a halt.

    He told TheStreet Roundtable, the crypto market has gone from a more “traditional” run in 2024 — with altcoins and crypto projects with actual utility gaining traction and retail investment — to a “completely crumbled, degen, casino reality” — only meme coins and such tokens gaining the attention of crypto retail.

    Crypto retail traders have increasingly realized that they are the exit liquidity, said Shadid.

    There is “blatant” manipulation of charts and there are so many pump-and-dump coins, so traders don’t bother to go for the highest-valued coins to make 2x-5x maximum, he added.

    Both crypto retail traders and founders have realized that VCs and market makers are only milking them, Shadid opined.

    The market is now in an “almost nuclear winter” where some projects with little adoption raise exorbitant amounts of money, only to end up being “forgotten and unused,” he said.

    If a project doesn’t have a token with 500x potential, it doesn’t find any takers even if it has actual utility, he expressed his frustration.

    Shadid said a lot of projects, including his own, now view crypto as a “toxic space” in which nothing matters other than the token.

    The founder concurred with Burry’s view that we are in an AI bubble but said a bearish outlook on Nvidia isn’t substantiated enough. However, he said the company’s valuation is getting dangerous.

    In fact, he is of the view that if and when the AI bubble bursts, useless AI companies operating at the App layer would collapse first. This, in turn, would affect Nvidia.

    Nonetheless, Shadid didn’t contend the fact that there is no going back from the “AI-native world.”

    This story was originally reported by TheStreet on Nov 14, 2025, where it first appeared in the MARKETS section. Add TheStreet as a Preferred Source by clicking here.

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  • When Fed tightening ends, nothing performs better than 30-year Treasurys — not even the S&P 500, top economist David Rosenberg says

    When Fed tightening ends, nothing performs better than 30-year Treasurys — not even the S&P 500, top economist David Rosenberg says

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    Known for identifying the housing market bubble in 2005, David Rosenberg is the chief economist and strategist at Rosenberg Research & AssociatesRosenberg Research

    • 30-year US Treasury bonds should outperform the stock market as the Fed tightening cycle nears its end.

    • That’s according to top economist David Rosenberg, who called the 2008 housing crash. 

    • Rosenberg said the current stock market rally “has been rather junky.”

    Bonds should outperform stocks as the Federal Reserve ends its cycle of hiking interest rates, according to top economist David Rosenberg.

    The Fed hasn’t hiked interest rates since its July meeting, and the market isn’t expecting a rate hike at the Fed’s last FOMC meeting of the year next month. That’s a big deal because historically, a five-month pause of no interest rate hikes marks the end of the Fed’s tightening cycle.

    If the Fed does keep interest rates unchanged at its December FOMC meeting, “the cycle is over. The next move would be a cut,” Rosenberg said in a Financial Post op-ed on Tuesday.

    And that’s good news for bonds, as a decline in interest rates would drive bond prices higher.

    Rosenberg explained that during a period when the Fed holds rates steady, the 30-year US Treasury significantly outperforms stocks.

    “In that pause period, bonds and stocks tend to rally together. But nothing does as well as the 30-year Treasury, which traditionally delivers an average total return of 9% point to point,” Rosenberg said. That outperforms a 7% return for the S&P 500 and a 6% return for investment grade and high-yield bonds over the same time period, according to Rosenberg.

    The outperformance is significant not only because of the sizable difference in returns, but because investors are taking on less risk when buying long-term bonds relative to stocks.

    And Rosenberg is skeptical that the recent rally in the stock market is sustainable, as the surge has been “rather junky” and “lacks fundamentals,” according to a Wednesday note from Rosenberg.

    Rosenberg said the S&P 500’s six percent rally over the past 10 days has happened alongside soft earnings guidance, and without the participation of small-cap stocks.

    “We have seen a rather sharp outperformance by stocks that were most shorted, have weak balance sheet, and non-profitable tech,” Rosenberg highlighted. “A polarized rally with no verve in small caps [indicates] concerns about economic momentum.”

    Economic concerns for Rosenberg include a steady reduction in monthly jobs added to the economy, as well as an unemployment rate that has jumped 50 basis points from its cycle low, from 3.4% in April to 3.9% in October.

    “That, indeed, is a recessionary signal,” Rosenberg warned.

    Read the original article on Business Insider

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