The Big Short investor Michael Burry has warned that the US stock market is on the verge of a major crash, and the reason for the plunge will be driven by AI. He stressed that the long-running rally is going to end, and the signs of a decline are already showing.

Michael Burry explained that the US stock market is no longer moving up or down due to consumer reports, jobs data, and inflation, but rather due to AI. “Absolutely non-stop AI. Nobody is talking about anything else all day,” he wrote after listening to a financial radio coverage on a long drive.

“Stocks are not up or down because of jobs or consumer sentiment. They are going straight up because they have been going straight up. On a two-letter thesis that everyone thinks they understand (AI). Feeling like the last months of the 1999-2000 bubble,” he wrote. The blind focus on only AI while ignoring key economic warnings will be the downfall of the US stock market.

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US Stock Market: AI Will Hit a Nail in the Coffin, Warns Michael Burry

Michael Burry calls the Nasdaq 100 will see a complete reversal with a harsh correction ahead. He stressed that the US stock market has jumped the shark and present-day investors will soon experience losses. “With what is happening in the market the last week, that I had lived this before suddenly dawned on me. The NASDAQ 100, complete reversal. I am calling something. The market has jumped the shark,” he said.

The millionaire also stressed that his predictions on the US stock market had been right most of the time. “Still, I got it right in 2000, got it right in 2007. Got it right in 2019, helped by COVID, and I called the meme stock crash in mid 2021. I called the bank stock run in 2023,” Michael Burry summed it up.