America's popular investor Michael Burry, known for predicting the 2008 housing crash in the US, has cast doubt on the sky-high valuations of both Anthropic and SpaceX, warning that hype rather than fundamentals is driving investor enthusiasm. As reported by Business Insider, in recent Substack discussions, Burry said that he sees little justification for Anthropic's nearly $1 trillion valuation, calling its AI model business "far too expensive" and unsustainable in the long run.
Anthropic's Expensive AI Model Business
AI giant Anthropic, maker of the popular Claude AI model, recently raised capital at a $965 billion valuation, paving the way for a public listing. Burry was blunt in his assessment: "There is no guarantee, and not even a strong likelihood, that Anthropic is long-term worth anywhere near $1 trillion." He argued that the company's reliance on brute-force computing power is unsustainable, predicting that AI compute will eventually be commoditized, much like internet usage. "What is happening now is a false demand signal," he wrote, warning that the rush to secure GPU capacity is driving over-investment that will outstrip actual needs in the coming years.
Tokenmaxxing and False Signals
The Anthropic comments were not made in isolation. They echoed a broader warning Burry had recently issued about a trend he calls "tokenmaxxing," the practice of throwing ever-increasing volumes of compute and data at AI models in pursuit of performance gains. His argument is that this trend has a ceiling, and the market has not yet priced that in. When the ceiling arrives, the companies and infrastructure built on the assumption of unlimited AI scaling will face a reckoning. It is a position that sits firmly outside the consensus view on Wall Street, where AI valuations have continued to climb, but Burry has never been particularly interested in consensus views.
Skepticism Over SpaceX IPO
Anthropic was not the only target. In the same Substack discussion, Burry turned his skepticism on SpaceX. Elon Musk's SpaceX filed its IPO prospectus (S-1) on May 20, revealing $18.7 billion in revenue and a $4.9 billion net loss last year. Despite this, the company is reportedly targeting a $2 trillion valuation. Burry dismissed the figure, writing: "Any move up will be on hype and technicals. Nothing in that S-1 suggests it is worth $1 trillion let alone $2 trillion."
In typical Burry fashion, he added a sharp quip: before paying $1 trillion for Anthropic, he would "count to 1 trillion," and "in 240,000 years I might reconsider."
