Warren Buffett sits on a record $397B in cash while Michael Burry shorts AI for $1B, betting it's 1999 all over again

Cole Tretheway

Wed, May 20, 2026 at 9:35 AM PDT 4 min read

While investors pour into the market, riding the updraft of wildly successful artificial intelligence stocks, two men wait for it all to come crashing down. These men are Warren Buffett, one of the most successful investors, and Michael Burry, who predicted the 2008 housing crash. And neither investor is impressed by today’s market.

“We’ve never had people in a more gambling mood than now,” Buffett told CNBC (1). “Absolutely non-stop AI. Nobody is talking about anything else all day,” said Burry in a recent Substack post.

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Both billionaires are putting their money where their mouth is. Berkshire Hathaway, where Buffett remains chairman, has refused to dish out its massive cash pile, which has risen to nearly $400 billion. In 2025, Burry reportedly shorted the AI boom for $1 billion by purchasing puts against Nvidia and Palantir (2). What do they see that the rest of the market can’t?

It’s boomtown in bust county

Both investors think the market is in for a bad time.

Buffett is notorious for sitting on piles of cash. Unlike many money managers, the longtime Berkshire Hathaway leader is content to do nothing when the market is going up. He told CNBC that of the sixty years he’s been in business, only five have offered juicy opportunities to buy (3). When the opportunity isn’t there, Buffett doesn’t buy.

Meanwhile, Burry compared the current market to the 1999-2000 dot com bubble.

“Stocks are not up or down because of jobs or consumer sentiment,” Burry wrote (4). “They are going straight up because they have been going straight up.”

SEC filings indicate Burry’s fund, Scion Asset Management, bought $187.6 million in puts on Nvidia, along with $912 million in puts on Palantir, in 2025 (2). Both stocks have been massive beneficiaries of the AI wave, skyrocketing in valuation (5). And optimism remains high; as of writing, Palantir’s trailing twelve-month price-to-earnings ratio is over 150 (6).

What this means for investors: two of the world's most successful investors think a market crash is inevitable, and AI stocks may be smashed the hardest.

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Why patience is key

Patience is perhaps the investor’s greatest defense against market crashes, and a killer edge when it comes time to buy.