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NVIDIA CorporationMichael Burry doubles down on Nvidia short after $500B chip deal he calls a 'Wall Street stunt' with 'shades of Enron'
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Michael Burry, the investor famous for predicting the subprime mortgage crisis, has increased his short position against Nvidia, calling the recent $500 billion Wall Street financing arrangement for Nvidia clients a 'Wall Street stunt' with 'shades of Enron'. In a Substack post dated Aug. 11, Burry compared the deal to Enron's effort to make wholesale power an investable class, warning that off-balance sheet liabilities today are putting both 2000 and 2008 to shame. He criticized the circular financing in which Nvidia backstops its own customers' projects, loans money that is then used to buy Nvidia technology, and takes equity stakes in client firms. Burry also noted that the $500 billion deal involves Nvidia taking 25% stakes and providing residual value guarantees on purchases of its chips, all filtered through private equity's private credit schemes.
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