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.

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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 nearly $400 billion. In 2025, Burry reportedly shorted the AI boom for $1 billion by purchasing puts against Nvidia and Palantir (2). What do they see that the rest of the market can’t?

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 sixty years he’s been in business, only five have offered juicy opportunities to buy (3). 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 (4). “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 (2). Both stocks have been massive beneficiaries of the AI wave, skyrocketing in valuation (5). And optimism remains high; as of writing, Palantir’s trailing twelve-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.

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Patience is perhaps the investor’s greatest defense against market crashes, and a killer edge when it comes time to buy.

Buffett is famous for saying “be fearful when others are greedy, and be greedy when others are fearful.” 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 (7).

In 2011, Goldman redeemed the preferred shares, handing Berkshire roughly $3.7 billion in profit (8). 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 (9), while Nvidia, which IPO’d in 1999, is now the world’s most valuable public company at over $5 trillion (10).

The question may be one of choice and timing: what 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 (11)” means he’s unlikely to be swayed by the AI hype, a storm that could sweep away impatient shareholders.

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CNBC (1), (4); Futurism (2); Fortune (3); Yahoo Finance (5), (6), (8), (9), (10); Goldman Sachs (7); Wealest (11).

This article originally appeared on Moneywise.com under the title: Warren Buffett sits on a record $397B in cash while Michael Burry shorts AI for $1B, betting it's 1999 all over again

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