Michael Burry Sounds the Alarm: Stock Market Now Resembles "Dotcom Bubble 2000"
Jakarta, CNBC Indonesia - Legendary investor Michael Burry has warned that the artificial intelligence (AI)-based stock rally on Wall Street could end brutally. According to him, the current market euphoria is beginning to resemble the final phase of the dot-com bubble in 1999-2000 before it collapsed.
The figure known from the film The Big Short assesses that investors are now too obsessed with AI, ignoring fundamental economic data. Burry himself was previously an investor who successfully predicted the 2008 global financial crisis well before it happened.
“AI is truly relentless. No one talks about anything else all day,” Burry wrote in a post on the Substack platform after following financial television and radio broadcasts during a long trip, as quoted by CNBC International on Monday (11/5/2026).
Burry said the US stock market movements now no longer reflect the actual economic conditions. He cited the S&P 500 index, which continues to hit record highs despite weakening consumer sentiment.
“Stocks don’t rise or fall because of jobs or consumer sentiment,” he wrote. “They keep rising because they’ve been rising for a long time. Based on a two-letter thesis that everyone thinks they understand. … It feels like the last months of the 1999-2000 bubble.”
He also highlighted the surge in the Philadelphia Semiconductor Index, which he sees as similar to the pattern of technology stock rises ahead of the dot-com bubble bursting in March 2000. That semiconductor index jumped more than 10% in a week and has strengthened around 65% throughout 2026.
In the past two years, AI-related stocks have indeed been the main driver of Wall Street’s strength. Shares in semiconductor companies to tech giants involved in developing AI infrastructure and software have soared sharply amid the generative AI fever.
Similar warnings were previously issued by hedge fund investor Paul Tudor Jones. In an interview with the media, Jones said the current market conditions remind him of 1999, a year before the tech stock bubble burst.
Although he believes the AI rally could continue for another one to two years, Jones warns of the risk of a sharp correction if stock valuations keep surging.
“Just imagine the stock market rising another 40%,” said Jones. “The stock market’s GDP might reach 300%, 350%. You surely know there will be some … very surprising corrections.”