Cassandra Unchained @michaeljburry

Why China will win AI in one chart. Power hungry Nvidia chips are not the way forward for the U.S. It is not just the total power advantage. It is the slope.

In 2000, I was short Amazon and called the top in the market, as well as the coming rally in Old Economy stocks. I believed in that so much I left medicine July of 2020 and went long 13 Old Economy stocks such as Paccar, Ross Stores, and Clayton Homes when Scion Capital launched October 2000.

I gave an interview to Barron’s in late June, 2021 honestly trying to warn people about an imminent meme stock collapse. Barron’s published the interview July 2021, near the top for AMC. Within a month or two all were crashing and by year end 2023, they had all collapsed.

@Ricardo_Celini I believe Buffett was also responding to the valuation of Microsoft and other big tech of the time. He was getting beaten up in the press about not being in this stuff. ANd he gave a very nuanced answer that was not anti-tech at all.

@y7_y00ts I believe I mentioned here and on Substack that I am long MOH, LULU and FOUR as positions I bought personally have been buying recently. When I had the fund, I would often trade around SEC filing dates to avoid disclosure.

This may support MOH but in the long run matters little to the thesis. I of course still like the stock. ACA: Four Republicans force vote on tax credit extension https://t.co/QFvxYEslrG

Free article to everyone. The $GME Big Short Squeeze Prequel, play-by-play with the emails, filings. If one takes the time to read everything in here, including all the attachments, one will see it again through Beary Burry’s eyes. Enjoy! Again, my apologies for the delay, I hope it is worth the wait.

Will drop my #GME post Sunday late evening.

The Supply-Side Gluttony Recurrence: Queries and Quibbles has been published. I took questions from the comment section of The Cardinal Sign of A Bubble: Supply-Side Gluttony and did my best to answer them long form. I cover $NVDA of course, defend my chart, and expand on misconceptions re: the demand/revenue side for generative AI, among other topics.

More excerpts from my piece on Fannie Mae and Freddie Mac. I did provide my unlocked Excel models for full user customization. These are at the end of the article. $FNMA $FMCC

Fannie & Freddie, Toxic Twins No More No More? Excerpt Recently, both news and gossip has picked up.   August 1st, Bloomberg reported that Trump was meeting with CEOs of the biggest banks to discuss monetizing the GSEs.     On August 8th, the WSJ cited sources claiming the

I published Fannie & Freddie, Toxic Twins No More No More? It is a 30 min read, not a light lift. My Excel models for these two are downloadable at the end of the article. https://t.co/SxhG8It3nA

Calling for pics and proof of Nvidia GPUs being warehoused in mass quantities In the US but also overseas. Some have reached out to me already. And it is getting interesting. But I need more. https://t.co/jbYGBmpt8k

The first half of 2021, I made some noise and news on a number of bearish callls - TSLA, GME, Bitcoin, Robinhood, the Nasdaq 100. MANY, including journalists like Jonathan Levin and Shuli Ren @Bloomberg cite these specific examples of how wrong I have been again and again to invalidate what I am saying today, but history proves differently. This is roughly what they did from that early 2021 time to early 2023, when in the middle of the banking crisis I said I was not seeing true danger and it could resolve quickly. To look back at those calls 5, 10, years later - any short call - is ridiculous. You really think any short seller holds those positions for 5, 10 years?

Everyone that knows anything knows this. OpenAI is the next Netscape, doomed and hemorrhaging cash, Microsoft is trying to keep it afloat while keeping it off balance sheet and sucking out the IP. So why do they keep getting funded? The whole industry NEEDS a 500 billion IPO ASAP.

I never said I was short $TSLA in my SS post. @fortune @bloomberg The article also reports on an older $500 million bet. No, it was $5 million. 13Fs and journalists… The full text of what I wrote: “Outgrowing dilution, for purposes of achieving maximum present value for an enterprise, is not easy. Tesla dilutes its shareholders at about 3.6% per year, with no buybacks. The chart above shows the kind of present value destruction that this level of dilution can impart. With recent news of Elon Musk’s $1 trillion dollar pay package, dilution is certain to continue. Tesla’s market capitalization is ridiculously overvalued today and has been for a good long time. [As an aside, the Elon cult was all-in on electric cars until competition showed up, then all-in on autonomous driving until competition showed up, and now is all-in on robots – until competition shows up.] Another beauty is Palantir, which has been diluting shareholders at about a 4.6% annual rate despite buybacks. Palantir has no earnings after adjusting for stock-based compensation. Palantir has the distinction of being the first billionaire:revenue ratio greater than one that I have seen. Five billionaires due to stock ownership, and less than four billion in annual revenue.”

The Tragic Algebra of Stock-Based Compensation. Part 2 of my response to Nvidia’s talking points sent to its Wall Street analysts to rebut my arguments. I make an example of Nvidia because, frankly, they make a really good example. https://t.co/lLUZYDD4bU

It was complicated with $GME. In some ways, I wasn't really done in 4Q 2019.

Remember GME? Bet you did not know this.

The $NVDA memo to its Wall Street sell-side analysis cited me as the first source. I attached the front page of the memo here. Also, part of my response addressing the depreciation issue.

Straw men do poorly in battle, $NVDA Part 2, The Heretic’s Guide to the AI Stars – Unicorns and Cockroaches https://t.co/w4BZIq49cF

Nvidia emailed a memo to Wall Street sell side analysts to push back on my arguments. I stand by my analysis. Obviously, the full analysis does not fit in a tweet. I will release on my timeline. The first post in The Heretic’s Guide to AI’s Stars “Supply-Side Gluttony” is up

Since the beginning of 2018, NVDA earned about $205B net income and $188B free cash flow, assuming all cap ex was growth cap ex. SBC amounted to $20.5B. But it bought back $112.5B worth of stock and there are 47 million MORE shares outstanding. The true cost of that SBC dilution was $112.5B, reducing owner's earnings by 50%. /rant

“But it’s Baidu” 2021:Useful life 4->5 years for servers 2024: Useful life 5->6 years for servers Took a RMB 16.2 billion impairment on RMB 30.1B net PPE. (over 50%) Had RMB 8-11 billion cap ex each of last 4 years, and Depreciation RMB 6.8 billion in 2024 In 2024, net income rose over 50% as a result of the useful life change.

Long MOH stock and Long PLTR puts, like peanut butter and bananas.