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Michael Burry's Nvidia Doubts? Buffett's Alphabet Bet Says "AI is the Real Deal"
Alright, folks, buckle up. You know I love a good tech debate, especially when it involves titans like Michael Burry – the guy who called the 2008 crash – and, well, Warren Buffett, who, let's be honest, has seen a thing or two in his time. The headlines are buzzing: Burry's still waving his red flag at Nvidia and the AI boom, pointing to potential bubbles and accounting trickery, while Buffett's Berkshire Hathaway quietly slips $4.3 billion into Alphabet (Google). Talk about a mixed signal! So, what's really going on here?
The Smart Money Speaks (Quietly)
Burry's been all over X (formerly Twitter), raising concerns about Nvidia's customers using older chips, the tangled web of deals between AI companies, and stock buybacks masking dilution. He's even questioning OpenAI's auditor! Classic Burry, right? Always the contrarian, always digging beneath the surface. He's making some valid points, no doubt. Are companies stretching the lifespan of older tech to inflate earnings? Are these "give-and-take deals" artificially propping up demand? These are the questions we need to be asking. As one report notes, 'Big Short' investor Michael Burry takes aim at Nvidia after its earnings blowout.
But then comes Buffett. Now, Berkshire doesn't exactly dive headfirst into every tech trend. They're known for their value investing, their long-term vision. So, when they make a move like this, it's worth paying attention. What does it mean? It's simple: They see long-term, sustainable value in the AI space, specifically with Alphabet. Alphabet, with its Google Cloud platform, its AI-powered features like Gemini and AI Overviews, is actually delivering results. Sundar Pichai himself said they're "seeing AI now driving real business results," and the numbers back it up.
Think about it: over 650 million monthly active users for Gemini, AI Overviews improving search query growth, and Google Cloud's AI offerings attracting a flood of customers. It's not just hype; it's tangible value being created. And with Alphabet planning to significantly increase its capital expenditure in 2026 after a $92 billion spend in 2025, it's clear they're betting big on AI for the long haul. They're not just dipping their toes in the water; they're building a whole new swimming pool!
And this is where the real story lies. It's not about whether every AI stock is a guaranteed winner. It's about the fundamental shift happening in how businesses operate, how we interact with technology, and how value is created. We're seeing AI integrated into everything, from cloud computing to search engines to self-driving cars (which Nvidia is heavily involved in, by the way). And this integration is driving real, measurable improvements in efficiency, productivity, and user experience.
Nvidia's CFO, Colette Kress, even took the unusual step of highlighting the financial reports of Nvidia's partners, pointing to the real-world impact of AI on their bottom lines. Meta, for example, is seeing more time spent on Facebook and Threads thanks to AI recommendation systems. Anthropic expects to earn $7 billion in annual revenue this year. And Salesforce's engineering team is 30% more efficient thanks to AI-powered coding tools! See? It's not just about the chips; it's about what those chips enable.
Now, I know what some of you are thinking: "But Aris, what about the risks? What about the ethical considerations?" And you're right, we can't just blindly rush into the future without thinking about the consequences. We need to ensure that AI is developed and deployed responsibly, ethically, and with a focus on human well-being. The potential for misuse is real, and we need to be vigilant. But that doesn't mean we should shy away from the incredible opportunities that AI presents.
Here's the thing: Buffett's investment in Alphabet isn't just about one company; it's about a vote of confidence in the entire AI ecosystem. It's a signal that the smart money sees something real, something sustainable, something transformative. And that's something we should all be excited about!