The Big Short 2.0? --- Michael Burry’s New Put Parade Spooks the Market and Pokes Palantir’s CEO

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If you thought Wall Street’s drama quota had been filled by streaming-optimized earnings calls and quarterly TikTok earnings reactions, welcome to Act II of “What Happens When Nostalgic Contrarians Go Shopping.” 

Michael Burry — the Scion Asset Management investor who famously bet against the housing market before the 2008 crash — has quietly bought a mountain of put-option exposure on two of the stock market’s new darlings: Nvidia and Palantir. And unsurprisingly, Palantir CEO Alex Karp is not thrilled!!

How big is “a mountain”? 

Scion’s filing shows put-option exposure covering roughly 5 million Palantir contracts and 1 million Nvidia contracts, amounting to about $1.1 billion in notional value. 

For the layperson: that’s not a strategic whisper into a crowded room — that’s a gong! 

Put options give the buyer the right to sell at a set price, and a position like that is basically Burry saying, “If these AI winners stumble, I want to be paid for the trip.”

The market’s reaction was predictably feverish. 

Stocks tied to AI have powered much of the recent rally — and the idea that a famed bubble-slayer might be betting against the very engines of that rally is enough to make even passive-index investors twitch... 

Of course, the editorial footnote matters: correctly calling the 2008 housing bubble doesn’t grant an eternal prophetic license. 

As the financial world mutters “past performance” under its breath, many remind us that spotting one bubble doesn’t make you a seer for the next one. 

Still — and this is important — if you’re wrong about an AI “bubble” popping, the effects ripple through retirement accounts and the broader economy like fault lines in an earthquake!

Enter Alex Karp, who responded not with a sonnet but with a pointed rebuke.

 

Karp argued short sellers are underestimating Palantir’s and Nvidia’s long-term AI prospects and risk missing the broader market shift toward artificial intelligence. 

He said that the “two companies he's shorting are the ones making all the money, which is super weird,” and bluntly suggested that Burry “may regret shorting AI leaders like Palantir and Nvidia.”

Those are emotionally satisfying lines — equal parts C-suite bravado and managerial GIF energy!!

Karp’s point is straightforward: AI is reshaping enterprise workflows and semiconductor economics in ways that many legacy valuation models struggle to capture. 

If the market is indeed re-pricing a future of enormous software automation and compute demand, being short could be a lonely seat on a very expensive airplane. 

But the counter-argument — and the one Burry seems to be making with cold, contractual clarity — is about valuation and timing. 

Markets have a habit of overshooting. 

What looks like a necessary, profitable technology can also take on extrapolations of growth that strain credulity.

This clash of personalities — the arsonist of skepticism versus the CEO of the Inc. 500 machine — is great theater... 

But beneath the headlines lies a practical reminder about risk: concentration risk in any hot sector is real. 

A pullback in a handful of mega-cap tech names can drag index funds and pension funds along for the ride. 

Whether Burry is an astute hedge-player or a 'Cassandra' with better PR is something investors will argue over cocktails and spreadsheets for months.

What should ordinary investors do while these titans joust? 

First: treat headlines like seasoning, not the main course. A single regulatory filing from a prominent short seller is newsworthy, but it’s not an instruction manual for your 401(k). 

Second: diversification still works as advertised — too many eggs in super-concentrated AI baskets increases risk. 

Third: watch the noise around timing and valuation, not the personalities; dramatic filings often tell you more about conviction than about an immediate market collapse.

If there’s a punchline, it’s this: Wall Street loves a plot. 

Michael Burry’s put purchases are a headline-ready plot twist; Alex Karp’s reaction is the sequel. 

The real story will be written over quarters — in revenue, margins, chip cycles, product adoption, and whether the AI-led growth story is durable enough to justify the multiple expansions it enjoys. 

Until then, enjoy the theater, keep your portfolio diversified, and remember that both bravado and contrarianism are better used as seasoning than as a financial diet!


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#BurryVsAI #PalantirPushback #NvidiaPuts #MichaelBurry #AlexKarp #PutOptionsDrama #AIValuationDebate #ShortSellerShowdown #ScionAssetMoves #PLTRNVDA #MarketConcentrationRisk #BigShortRedux #TimingNotTalent #DiversifyDontPanic #WallStreetTheater

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