The AI frenzy has entered a dangerous stage! "Big Short" Barry is once again urging investors to reduce their positions in tech stocks

According to the Zhitong Finance APP, on Monday, Michael Burry, known as the "Big Short" for successfully predicting the 2008 U.S. housing crisis, issued another warning about the current AI-driven U.S. stock market, stating that the market environment has reached a dangerous stage similar to historical speculative bubbles and advised investors to reduce their exposure to technology stocks.

Burry wrote on Sunday that as the AI frenzy and momentum trading continue to drive up technology stock valuations, investors should now "reject greed." He stated, "For most people, a simpler approach is to reduce stock positions, especially in technology stocks. For those stocks that have shown parabolic rises, positions should be almost completely reduced."

In recent months, Burry has repeatedly warned that the current enthusiasm for AI in the U.S. stock market increasingly resembles the final stages of the internet bubble.

Last week, he compared the recent performance of Philadelphia semiconductor stocks to the upward trajectory before the tech stock crash in March 2000, stating that the current market environment "is very similar to the last few months of the internet bubble from 1999 to 2000."

Burry also revealed that he currently maintains a significant leveraged short position to hedge against a basket of stocks he believes are undervalued and underperforming, similar to the strategy he employed during the 2000 internet bubble.

However, Burry emphasized that most ordinary investors are not suited for directly shorting the market. He said, "Shorting is not the answer, nor is it something most people should do." He pointed out that currently, whether buying put options or directly shorting stocks, the costs are very high and could also pose significant risks.

Burry stated that in the current market environment, a more reasonable strategy is to increase cash holdings and wait for more attractive entry opportunities in the future. He said, "History tells us that even if this frenzy continues for a week, a month, three months, or even a year, the final outcome is often still lower prices."

Currently, Wall Street is increasingly debating whether the AI market in the U.S. has detached from fundamentals. Despite the ongoing escalation of the Middle East conflict, major U.S. stock indices continue to hit historical highs, with substantial funds continuously flowing into semiconductor and large technology companies