Warren Buffett sits on a record $397B in cash while Michael Burry shorts AI for $1B, betting it's 1999 all over again

Warren Buffett sits on a record $397B in cash while Michael Burry shorts AI for $1B, betting it's 1999 all over again Daniel Zuchnik/WireImage, Astrid Stawiarz/Getty Images Robyn Tellefsen Wed, May 27, 2026 at 2:15 PM GMT+2 7 min read Moneywise and Yahoo Finance LLC may earn commission or revenue through links in the content below. While investors pour into the market, riding the updraft of wildly successful artificial intelligence stocks, two men wait for it all to come crashing down. These men are Warren Buffett, one of the most successful investors and Michael Burry, who predicted the 2008 housing crash.

And neither investor is impressed by today’s market. “We’ve never had people in a more gambling mood than now,” Buffett told CNBC (1). “Absolutely non-stop AI.

Nobody is talking about anything else all day,” said Burry in a recent Substack post (2). Top Picks Here’s how to get rich from rising US property values with as little as $100 — and without the stress of angry tenants Dave Ramsey warns nearly 50% of Americans are making 1 big Social Security mistake — here’s how to fix it ASAP Goldman Sachs used to hoard prime real estate deals for the ultrarich. Two ex-analysts just opened the door for $250 Both billionaires are putting their money where their mouth is.

Berkshire Hathaway, where Buffett remains chairman, has refused to dish out its massive cash pile, which has risen to $397 billion (3). In 2025, Burry shorted the AI boom for $1 billion by purchasing puts against Nvidia and Palantir, reports CNN (4). What do they see that the rest of the market can’t?

It’s boomtown in bust county Both investors think the market is in for a bad time. Buffett is notorious for sitting on piles of cash. Unlike many money managers, the longtime Berkshire Hathaway leader is content to do nothing when the market is going up.

He told CNBC that of the 60 years he’s been in business, only five have offered juicy opportunities to buy. When the opportunity isn’t there, Buffett doesn’t buy. Meanwhile, Burry compared the current market to the 1999-2000 dot-com bubble.

“Stocks are not up or down because of jobs or consumer sentiment,” Burry wrote on Substack. “They are going straight up because they have been going straight up. ” SEC filings indicate Burry’s fund, Scion Asset Management, bought $187.

6 million in puts on Nvidia, along with $912 million in puts on Palantir, in 2025, reports CNN. Both stocks have been massive beneficiaries of the AI wave, skyrocketing in valuation (5). And optimism remains high; as of writing, Palantir’s trailing 12-month price-to-earnings ratio is over 150 (6).

What this means for investors: Two of the world’s most successful investors think a market crash is inevitable and AI stocks may be smashed the hardest. Read More: Here’s the average income of Americans by age in 2026. Are you falling behind?

Why patience is key Patience is perhaps the investor’s greatest defense against market crashes and a killer edge when it comes time to buy. Story Continues Buffett is famous for saying, “Be fearful when others are greedy and be greedy when others are fearful (7). ” The second half is key: The billionaire has a massive appetite for stocks once a bubble has popped.

At the height of the 2008 financial crisis, Berkshire Hathaway invested $5 billion in Goldman Sachs preferred stock at a 10% annual dividend, plus warrants to buy another $5 billion in common shares at $115 each (8). In 2011, Goldman redeemed the preferred shares, handing Berkshire roughly $3. 7 billion in profit (9).

The lesson: Investors might be better off withholding AI money and loading up cash in preparation for what could be an epic market crash. That’s not to say AI companies are worthless. Many internet companies that suffered during the dot-com bust went on to dominate the digital market and are worth trillions today.

Amazon alone is worth $2. 9 trillion (10), while Nvidia, which IPO’d in 1999, is now the world’s most valuable public company at over $5 trillion (11). The question may be one of choice and timing: Which companies hold durable value?

And when is the best time to buy shares? Investors could do worse than follow the moves of Berkshire Hathaway’s former CEO and current chairman. Buffett’s commitment to staying within his “circle of competence” (12) means he’s unlikely to be swayed by the AI hype, a storm that could sweep away impatient shareholders.

How to stay calm in the storm If your own circle of competence is smaller than you’d like, consider enlisting the help of an expert who lives and breathes the markets. After all, for investors with portfolios of $250,000 or more, financial decisions can become increasingly nuanced. Managing withdrawals, minimizing tax exposure and ensuring long-term sustainability often requires greater coordination and strategic planning.

In these cases, working with a financial advisor can help reduce costly mistakes. A professional financial advisor can also provide a much-needed sanity check in the midst of the AI hype and ensure your own portfolio is properly diversified. And if you have a portfolio of $250,000 or more, platforms like WiserAdvisor can connect you with vetted professionals who specialize in this kind of planning.

Simply answer a few questions about your savings, retirement timeline and overall investment portfolio. From there, WiserAdvisor will review its network to match you — for free — with up to three vetted, reputable advisors aligned with your specific needs. You can then schedule no-obligation consultations with your matches to determine the best fit for your long-term goals.

WiserAdvisor is a matching service and does not provide financial advice directly. All matched advisors are third parties and specific financial results are not guaranteed. Tap into expert research As you consider which investments make the most sense for your individual situation, it’s important to ask the aforementioned question: Which companies hold durable value and when is the best time to buy shares?

But unless you’re a finance guru, that question isn’t always easy to answer. That’s where expert insights can be a game changer. Moby offers expert research to help you identify strong, long-term investments backed by advice from former hedge fund analysts.

In fact, in four years and across almost 400 stock picks, their recommendations have beaten the S&P 500 by almost 12% on average. They also offer a 30-day money-back guarantee. Moby’s team spends hundreds of hours sifting through financial news and data to provide you with stock and crypto reports delivered straight to you .

Their research keeps you up-to-the-minute on market shifts — including AI highs and lows — and can help you reduce the guesswork behind choosing stocks and ETFs. Plus, their reports are easy to understand for beginners, so you can become a smarter investor in just five minutes . Put diversified investing on autopilot Though Buffett may be unimpressed with today’s market, he is famously optimistic that the U.

S. economy always bounces back. Consider his 2020 letter to Berkshire shareholders, while the pandemic raged (13).

“Despite some severe interruptions, our country’s economic progress has been breathtaking,” he wrote. “Our unwavering conclusion: Never bet against America. ” One great way to rely on the Oracle’s optimism?

Automate your investments. Platforms like Stash make this incredibly straightforward. With over 1 million active subscribers and more than $5 billion in assets under management, the intuitive app lets you set daily, weekly or monthly recurring investments that actually match your cash flow.

You can build a diversified portfolio in just a few clicks using its award-winning Smart Portfolio, which adjusts your investment mix based on your goals and risk level. Prefer a more hands-on approach? You can also choose your own stocks and ETFs, or mix both depending on your comfort level.

And if you’re looking to take your long-term strategy a step further, a Stash+ subscription offers 3% IRA matching that can give your contributions a meaningful boost over time. You can set up a recurring deposit in just a few minutes and let your portfolio work for you on autopilot. Plus, you can get a $25 bonus investment when you fund a new Stash account with $5, plus a 3-month trial to explore the platform.

* * All investments are subject to risk and may lose value. View important disclosures. Offer is subject to T&Cs .

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- With files from Cole Tretheway. Article sources We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines .

CNBC ( 1 ), ( 2 ); Fortune ( 3 ); CNN ( 4 ); Intellectia ( 5 ); Yahoo Finance ( 6 ), ( 10 ); New York Times ( 7 ); Goldman Sachs ( 8 ); Bloomberg ( 9 ); AlphaSense ( 11 ); Berkshire Hathaway ( 12 ), ( 13 ) This article provides information only and should not be construed as advice. It is provided without warranty of any kind.