Dear Bleeding Edge Reader, Michael Burry gained fame in the book and movie, The Big Short. Played by actor Christian Bale, he warned investors about the housing bubble before almost anyone else. And in the end, he was right. But now, Burry is loudly predicting a massive AI bubble, comparing it to the dot-com bubble. And I'm here to tell you: This time, he's dead wrong. And anyone who believes his advice is going to miss out on perhaps the biggest boom in American history. My name is Jeff Brown. I was one of the very first to call Nvidia what it is: an artificial intelligence company. I recommended the stock in February 2016 – over six years before ChatGPT was released to the public. The stock is up 28,534% now. $15,000 invested would be worth $4 million. Now, I respect Michael Burry a lot. But I believe he's being a bit duplicitous here. Consider that before he started posting on X about an AI bubble – he hadn't posted in nearly three years. Even more important, he built large short positions in advance of his series of posts about the AI bubble. This is classic Wall Street antics. Quietly build your large position, then go public in an effort to influence the market in the desired direction... And as much credit as Burry gets for calling the subprime crisis in 2008, I think it's important to examine the full breadth of his predictions. - In early 2017, he predicted a financial meltdown. But the S&P 500 soared 23% that year. I was bullish at that time.
- In the fall of 2019, he predicted that index funds and ETFs were distorting the market and would result in a crash. Yet the S&P 500 rose 28% that year and continued even higher in 2020 and 2021 (with the exception of the pandemic spring of 2020). I was bullish then as well.
- In December 2020, he took out a $530 million short position on Tesla, claiming ridiculous valuations. I was bullish. Tesla's share price soared 90% over the next year.
- In early 2021, he claimed that inflation would destroy Bitcoin. I was bullish. Bitcoin rose to new highs.
- In August 2023, he placed a $1.6 billion bet against the S&P 500 and the NASDAQ, predicting a crash. I was bullish. The market rallied, led by tech stocks, and Burry's puts expired worthless.
Today, I think he's dead wrong about the overall AI market. And it comes down to one thing: Michael Burry is just an investor. He's not a technology expert. And he's missing some key points about AI and the future of technology. I'm not just picking on Burry either. There are a lot of so-called experts out there who really know nothing about how the technology works and where this is all going. I'm not just a successful investor... my background is aerospace engineering. In fact, I have a degree from Purdue University's famed aeronautical and astronautical engineering program. This is the same so-called "Cradle of Astronauts" that produced Neil Armstrong, the first man to walk on the moon, amongst a plethora of NASA stars. I've worked extensively in the semiconductor industry, in wireless networks, in IT networking, cybersecurity, and with fiber-optic networks. I served as a high-level executive at tech firms like Juniper Networks, Qualcomm and NXP Semiconductors. I've climbed poles, walked factory floors, worked in data centers, and done billions of dollars of high-tech business around the world. And I've been intimately involved in many of the most breakthrough technologies of our time. I live for it. From what I know about this incredible AI trend – which, humbly, is a lot more than Michael Burry... I believe it's still early and the AI boom is just beginning. In this video, I'll share the best way to play this boom. I'll answer definitively whether we're in an AI bubble or not. And I'll show you what's really going on inside these AI data centers, and why they could be exponentially more valuable than we see them today. Click here to watch the video. Regards,  Jeff Brown
Founder & CEO, Brownstone Research | 
No comments:
Post a Comment