The Silence of Scion Ends in a Subscription
Michael Burry is no longer a hedge fund manager. On November 10, 2025, the SEC’s Investment Adviser Public Disclosure database marked Scion Asset Management as “Terminated.” The man who famously shorted the housing market has walked away from the regulatory shackles of the 13F filing. He did not retire. He simply changed his weapon. Yesterday, Burry launched “Cassandra Unchained,” a $379-per-year newsletter designed to speak “freely” about what he identifies as the most egregious valuation gap in human history.
The timing is surgical. Just five days ago, on November 19, Nvidia reported a staggering $57.0 billion in quarterly revenue, a 62 percent jump from the previous year. To the retail crowd, it was a triumph. To Burry, it was a siren song. He is currently carrying short positions against Nvidia and Palantir, betting that the very foundation of the AI rally is built on a technical accounting mirage.
The Depreciation Arbitrage Mechanism
Burry’s primary thesis centers on a concept he calls “Supply-Side Gluttony.” It is a technical mechanism that most analysts are ignoring. Major cloud hyperscalers like Meta, Oracle, and Google are currently extending the “useful life” of their computing equipment. By moving the depreciation schedule of AI servers from four years to six years, these firms are effectively hiding billions in expenses. Burry estimates this accounting maneuver will understate depreciation by $176 billion through 2028.
This is the follow-the-money moment. If a Blackwell chip is obsolete in 24 months due to the rapid pace of compute evolution, depreciating it over six years is a fiction. It artificially inflates net income. Per the Nvidia Q3 earnings report, the company’s gross margins sit at 73.4 percent. Burry argues these margins are sustained only because the customers (the hyperscalers) are over-capitalizing their balance sheets. When the CAPEX burnout hits, the demand for $40,000 GPUs will not just slow down. It will evaporate.
The Concentration Crisis of 2025
The risk is not just in one stock. It is in the structural integrity of the entire S&P 500. As of late November 2025, the market concentration in the top five tech names has reached levels that dwarf the 2000 Dot-Com peak. The Shiller P/E ratio (CAPE) currently sits at 38.9, placing it in the 99th percentile of historical data. For context, reaching a single-digit P/E10 today would require the S&P 500 to fall below 1,800 points.
Burry’s newsletter highlights that the current market price is 140 percent above its historical geometric average. The reward for bulls is a potential 10 percent melt-up if the Federal Reserve cuts rates in December. The risk is a 50 percent reversion to the mean. For Burry, the math is simple. The “Big Short” was about fraudulent mortgages. The “Big Intelligence Short” is about fraudulent depreciation.
A Comparison of Market Extremes
To understand why Scion’s founder is so aggressive, one must look at the fundamental metrics of the current market leaders compared to the previous tech bubble. While Nvidia’s earnings are real, their sustainability depends on a circular economy where big tech companies buy chips to sell AI services that have yet to produce significant enterprise revenue.
| Valuation Metric | 2000 Dot-Com Peak | Nov 2025 Status |
|---|---|---|
| S&P 500 CAPE Ratio | 44.2 | 38.9 |
| S&P 500 Concentration (Top 5) | 18% | 34% |
| Nvidia/Cisco Forward P/E | 150x (Cisco) | 48.5x (Nvidia) |
| Benchmark 10Y Yield | 6.2% | 4.4% |
The Forward Path to 2026
Burry is not waiting for a specific event. He is waiting for the weight of capital to break the scale. He notes that in February 2000, the San Francisco Chronicle mocked his short on Amazon just months before it lost 80 percent of its value. History is rhyming. The next 60 days will be dominated by the “Santa Claus Rally” narrative, but the smart money is looking past the tinsel.
The true test for this AI cycle arrives with the January 2026 earnings season. Watch the CAPEX guidance from Microsoft and Amazon. If those figures show a sequential decline for the first time in three years, the $5 trillion market cap floor under Nvidia will crack. Burry is already positioned for the impact. The question for everyone else is whether they are willing to pay $379 to hear the man who hasn’t been wrong about a bubble yet.
