Investor Michael Burry said on Monday he is more confident than ever that the bubble in artificial intelligence stocks will burst within the next year, bringing forward a forecast he had previously placed in 2028.

Burry, whose bet against the mid-2000s US housing bubble was chronicled in the book and film The Big Short, said in a Substack post that he is “moving timelines up,” mainly because he expects “the bubble in AI may burst sooner than later,” according to a report by Business Insider.

The shorter timeframe led Burry to seek “more leverage in my short positions,” he said, so he closed his outright short positions and replaced them with put options, which give the holder the right, but not the obligation, to sell a stock at a fixed price before a set expiry date.

Burry said he took out puts on Nvidia, Palantir, Micron, Nebius, Oracle, Caterpillar, the iShares Semiconductor ETF and the Nasdaq 100 index, with the contracts expiring between June and December 2027.

He also closed his short position in CoreWeave and plans to buy puts on the company once they are attractively priced, and bought new puts on MetLife, he said.

Burry said he bought Nvidia puts expiring next September with strike prices in the mid-$100s, less than half the chipmaker’s closing price of $229 on Monday. His Nasdaq 100 puts, also expiring in September, are struck in the $24,000s, indicating he expects the technology-heavy index to fall by close to 20% from around $30,300 now.

If the spending stops or slows, it all comes apart

Burry wrote that AI companies are borrowing and spending an unsustainable amount to build data centres, and that the cash being used is “increasingly debt, with strings attached.” He said rising interest rates could add pressure because private equity, private credit and their insurers are financing much of the buildout, adding: “Higher rates stress every part of that chain.”

“There are signs of strain at each of the big hyperscalers,” Burry said in another recent post, writing that the companies’ public comments and regulatory filings “provide clues as to how stressed each one really is.” “I think there are many ways these companies are starting to fray,” he wrote.

Burry moved from running a hedge fund to writing about his personal investments on Substack last autumn. He has repeatedly warned that enthusiasm for AI, which has driven the stock market to record highs this year, will not last.

He has said AI companies are masking slowing growth, overinvesting in chips and data centres, using accounting methods to inflate short-term earnings, harming shareholders by issuing too much stock to pay employees, and signing circular financing deals to sustain the rally.

Stocks have so far continued to rise despite concerns about excessive optimism around AI and other pressures including foreign conflicts, rising interest rates, higher bond yields and a renewed inflation threat.