Market downturns and corrections are completely normal. But when the stock market gets volatile, investors tend to make the wrong moves. Joe Anderson, CFP and Big Al Clopine, CPA show you the balancing act that can improve your long-term financial outlook even in the face of stock market volatility.
Michael Burry exposes how Big Tech pumps AI profits
Big Tech’s artificial intelligence boom is being sold as a revolution in productivity, but the numbers suggest it is also a carefully engineered financial machine. Michael Burry has zeroed in on how a handful of platforms are using AI narratives, accounting choices, and capital spending cycles to magnify reported profits and market power in ways that ordinary investors can easily misread.
I see his warnings less as a prediction of imminent collapse and more as a roadmap to where the incentives are skewed: in cloud infrastructure, in opaque AI “cost savings,” and in the way a few dominant firms can shift entire index returns. Understanding those mechanics is essential before treating AI as a one-way ticket to permanent earnings growth.
Michael Burry’s latest warning on AI-fueled profits
Michael Burry has built his reputation on spotting when financial stories drift too far from underlying cash flows, and his recent focus on AI fits that pattern. He has argued that the market is again concentrating risk in a narrow group of companies whose valuations depend on aggressive assumptions about future technology-driven profits, echoing the dynamic he previously highlighted in housing and in the 2021 meme-stock surge. In his view, AI has become a narrative that can justify almost any multiple as long as investors believe that current spending will translate into dominant, high-margin platforms later.
His portfolio moves reflect that skepticism. Regulatory filings show that Burry has used index options and targeted shorts to bet against broad market benchmarks that are heavily weighted toward mega-cap technology names, while also taking selective long positions in more reasonably priced businesses that could benefit from AI without being priced for perfection. Those filings indicate that he is not dismissing AI as a technology, but rather questioning whether today’s earnings and cash flows support the valuations attached to the companies most loudly promoting it, a distinction that aligns with his earlier critiques of speculative manias in growth stocks and crypto-linked assets through filings and public comments.
How Big Tech turns AI spending into market power
The core of Burry’s concern is that AI is reinforcing an already extreme concentration of power in a few platforms that control cloud infrastructure, data, and distribution. Companies such as Microsoft, Alphabet, Amazon, and Meta are pouring tens of billions of dollars into data centers and specialized chips, then using that scale to lock in customers and partners. That spending is not just about building new products, it is also about raising the barrier to entry so high that smaller rivals cannot realistically compete on model training, inference speed, or global reach
Recent earnings reports show how this strategy works in practice. Microsoft has tied its Azure growth to AI services that are deeply integrated into Office 365 and GitHub, while Alphabet has bundled its Gemini models into search and Workspace, and Amazon has leaned on its AWS footprint to pitch AI tools to existing cloud clients. Each of these companies has reported that AI-related demand is a key driver of cloud revenue acceleration, and they have highlighted multi-year customer commitments that effectively cement their positions. Those disclosures, detailed in their latest earnings releases, Alphabet filings, and Amazon updates, show how AI capital spending is being converted into durable market share rather than just experimental R&D.
The accounting tricks behind AI “profitability”
On the surface, Big Tech’s AI push looks wildly expensive, yet reported margins have held up better than many expected. A key reason is accounting. Data centers, GPUs, and networking gear are treated as capital expenditures that are depreciated over several years, which means only a fraction of the actual cash outlay hits the income statement in any given quarter. That timing gap allows companies to present AI initiatives as accretive to earnings even while they are writing enormous checks to chipmakers and construction firms.
Several firms have also adjusted the useful lives of their servers and networking equipment, a change that lowers near-term depreciation expense and boosts operating income. Alphabet, for example, extended the estimated life of its servers and certain network gear, a move that added billions of dollars to operating profit over a full year according to its financial disclosures. Meta made similar changes to its depreciation schedules, which it said would improve 2024 operating income by several billion dollars in its quarterly report. Those choices are allowed under accounting rules, but they make AI-heavy businesses look more profitable today than they would if all costs were expensed immediately, a nuance that Burry has flagged as a source of investor overconfidence.
Cloud, chips, and the AI capex flywheel
AI’s financial engine runs through a tight loop connecting cloud providers, chipmakers, and software platforms. Big Tech companies commit to massive capital expenditure programs to build or lease data centers and secure priority access to advanced GPUs. Those orders, in turn, drive record revenue and pricing power for semiconductor firms, which then justify their own elevated valuations and expansion plans. The result is a feedback loop in which each side’s optimism about AI demand validates the other’s growth story, even if the ultimate end-user monetization is still uncertain.
Recent guidance from Nvidia, for instance, has highlighted extraordinary demand for its data center products, with revenue surging as hyperscalers race to deploy its H100 and successor chips. That demand is directly tied to the capex plans of Microsoft, Alphabet, Amazon, and Meta, which have all raised their full-year infrastructure spending forecasts in their latest financial updates and investor presentations. Burry’s concern is that this flywheel can obscure the underlying risk: if AI workloads do not generate the expected high-margin software and subscription revenue, the industry could be left with overbuilt capacity and hardware inventories that are far less productive than current models assume.
AI narratives and the new “Nifty Fifty” concentration
The AI boom has intensified an already sharp concentration of market returns in a small cluster of mega-cap stocks. Index performance in the United States has been dominated by a handful of technology and communication services names whose weightings have swelled as their share prices climbed. That concentration means that broad benchmarks can appear healthy even if the median stock is flat or declining, a pattern that Burry has previously criticized when he warned about narrow leadership in growth indices.
Data from recent index performance reports show that companies such as Microsoft, Apple, Alphabet, Amazon, Meta, and Nvidia account for a disproportionately large share of total market capitalization and earnings growth. Analysts have compared this group to the “Nifty Fifty” of the 1970s, a set of blue-chip stocks that investors once believed could be bought at any price because of their perceived invincibility. Today, AI is the unifying story that underpins similar confidence in the current leaders, as reflected in their premium valuation multiples and in the way passive flows automatically reinforce their dominance through capitalization-weighted index construction, a trend documented in index concentration studies and market structure analyses.
Where AI really boosts productivity, and where it doesn’t
One reason AI stories are so powerful is that there are genuine productivity gains in specific use cases, from code generation to customer support. Enterprise software vendors have reported that tools like AI copilots can reduce routine coding time, help draft documents, and automate parts of sales and marketing workflows. Those improvements can translate into higher willingness to pay for software subscriptions and can support price increases or new premium tiers, which in turn feed into Big Tech’s revenue growth.
The gap between promise and reality appears when those gains are extrapolated across entire economies or used to justify blanket assumptions about margin expansion. Surveys of corporate adopters show that while some teams see measurable efficiency improvements, others struggle with integration costs, data quality issues, and the need for human oversight. Several companies have disclosed that AI features are still a small fraction of total usage or revenue, even when they are heavily marketed in product launches and earnings calls. That nuance shows up in detailed breakdowns from firms like Microsoft and Salesforce, which have described early traction for AI add-ons but also noted that they remain in the ramp-up phase in their earnings commentary and investor materials. Burry’s skepticism rests on this mismatch between selective success stories and the sweeping claims often used to support market-wide AI valuations.
Regulatory scrutiny of AI dominance and data use
As AI becomes central to Big Tech’s business models, regulators have started to question whether the same companies that dominate search, social media, and cloud should also control the infrastructure and data pipelines for generative models. Antitrust authorities in the United States and Europe have opened inquiries into cloud market structure, data access, and the competitive impact of exclusive partnerships between large platforms and leading AI labs. Those investigations reflect a concern that incumbents could use their financial and technical advantages to entrench their positions in the next wave of computing.
Recent regulatory actions include formal probes into cloud pricing practices, reviews of major AI-related acquisitions, and scrutiny of how training data is collected and used. European regulators have examined whether bundling AI services with existing productivity suites could disadvantage smaller rivals, while U.S. agencies have signaled that they are watching large investments in independent AI developers for potential control or influence. These moves are documented in official competition announcements and regulatory inquiries. For investors, the risk is that business models built on aggressive data collection or tight ecosystem lock-in could face legal or structural constraints just as AI-driven revenue streams are being scaled up.
What Burry’s playbook suggests for AI investors
Looking at Burry’s history, his approach to AI-linked markets appears to follow a familiar pattern: focus on balance sheets and cash flows, question consensus narratives, and look for asymmetries where downside is underpriced. He has often emphasized that the most dangerous moments are when investors extrapolate recent trends indefinitely, whether in housing prices, passive flows, or now AI-driven earnings. In practical terms, that means stress-testing how sensitive Big Tech valuations are to slower AI adoption, higher capital costs, or regulatory friction.
For individual investors, his playbook points toward a few concrete disciplines. One is to separate the undeniable long-term potential of AI from the specific claims made by any single company about its competitive moat or margin trajectory. Another is to examine how much of a firm’s reported profitability depends on accounting choices such as extended asset lives or capitalized software development, details that are spelled out in the notes to financial statements and in regulatory filings. A third is to recognize concentration risk in portfolios that track major indices, where AI leaders can dominate performance. Burry’s own use of hedges and selective shorts, documented in his 13F disclosures, underscores his belief that even transformative technologies can be overpaid for when enthusiasm outruns verifiable earnings power.
The real test for AI profits is still ahead
For now, Big Tech’s AI push is delivering impressive headline numbers, from surging cloud revenue to record chip sales. The question Burry keeps pressing is whether those gains represent a sustainable new profit base or a phase in a capital cycle that could eventually normalize. The answer will depend on how quickly AI applications move from pilot projects and early adopters into the core workflows of industries like healthcare, manufacturing, and finance, and whether customers accept the pricing power that platforms are trying to exert.
Over the next few years, investors will be able to track that transition in a few tangible ways: the share of revenue tied explicitly to AI products, the trajectory of operating margins after the initial wave of depreciation adjustments, and the outcome of regulatory challenges to data and cloud dominance. Company disclosures already provide some of these signals in segment reporting and forward guidance, as seen in the detailed breakdowns from Microsoft, Alphabet, Amazon, Meta, and Nvidia in their latest earnings reports, investor updates, and financial statements. Burry’s critique serves as a reminder that the real measure of AI’s economic impact will not be the size of the data centers or the speed of the chips, but the durability of the cash flows that emerge once the initial investment frenzy subsides.
A new leader is needed for teachers. The present union leader has failed our country.
The only way you can correct this is for the parents to sue the union for what they have done to our children or to form a separate conservative union because the left will never repent.
Haven’t we stood around long enough – our children can’t read/write or add or subtract, ie. MAKE A MONEY CHANGE.
All the left wants are – useful idiots. Plain and simple.
We have allowed this for too long. It is effecting our economy.
We must put the blame where it belongs – Obama/Biden/Socialist Democrats. This is planned destruction.
This is a war for the protection of our future leaders.
****
NEA Training Calls Republicans “Racist Villains” Who Use “Dog Whistles”
The National Education Association is hosting a December 2-4 training called “Advancing LGBTQ+ Justice and Transgender Advocacy” to teach union members how to fight conservatives, according to leaked documents obtained by Defending Education.¹
The training materials read like a Democrat Party strategy memo, not an education conference.
“Over the last ten years, Republicans in state legislatures have increasingly turned to anti-transgender rhetoric and legislation as a powerful complement to their arsenal of racist dog whistles used to whip up fear and consolidate power,” the NEA training packet declares.²
The union accuses Republicans of pairing these attacks with Critical Race Theory opposition, “mobilizing their base with a potent mix of racist and transphobic tropes.”³
Read that again.
The nation’s largest teachers union just branded every parent who opposes boys in girls’ bathrooms as a racist wielding “dog whistles.”
In official training materials distributed to three million members.
The documents instruct teachers to “pluralize” gender by saying “our genders” instead of “gender” to normalize the idea of endless gender possibilities.⁴
Teachers are told to introduce their pronouns to groups and encourage others to do the same, saying it “shifts people towards our worldview.”⁵
The materials include step-by-step gender transition guides for teachers, complete with sample emails announcing their intent to transition and school-based “transition plans.”⁶
But here’s the most chilling part.
The NEA coaching manual tells teachers to deploy a “Race Class Gender Narrative” designed to “mobilize our progressive base” while working to “marginalize our opposition.”⁷
The instructions explicitly tell union members to “Name the villains who violate our values.”⁸
Those villains? You. Your family. Anyone who voted for Donald Trump.
Teachers Unions Chose Left-Wing Activism Over Educating Children
This explains everything parents have been seeing in their kids’ classrooms.
The NEA stopped pretending to care about education years ago.
In 2019, NEA delegates rejected a resolution to “rededicate itself to the pursuit of increased student learning in every public school in America by putting a renewed emphasis on quality education.”⁹
A teachers union refused to prioritize student learning.
They said the quiet part out loud: education isn’t the mission anymore.
Political warfare is.
The NEA and American Federation of Teachers dumped more than $43 million into left-wing political causes from 2022 to 2024.¹⁰
Since 1990, the NEA has funneled 98% of its political contributions to Democrat candidates.¹¹
The union spends twice as much money on political activism as it does representing the teachers paying dues.¹²
Let that sink in for a second.
Your kid’s teacher pays union dues thinking the NEA will negotiate better pay and working conditions.
Instead, the NEA takes that money and uses it to call you a racist for not wanting biological males in your daughter’s locker room.
NEA President Becky Pringle spent 2025 calling Trump a “fascist” and demanding union members engage in “acts of resistance” against the administration.¹³
At the union’s July convention in Portland, Oregon, delegates passed resolutions defending illegal immigration and transgender athletes in girls’ sports.¹⁴
The NEA also severed ties with the Anti-Defamation League this year — abandoning the nation’s leading antisemitism watchdog while antisemitic attacks hit record highs.¹⁵
This is what your tax dollars fund in government schools.
Not math or reading. Political indoctrination and left-wing activism.
The Reckoning Is Coming for Teachers Unions
Erika Sanzi from Defending Education didn’t hold back when she saw the leaked training materials.
“The NEA is the largest teachers’ union in the country, and they have decided to vilify half the country in an upcoming training,” Sanzi said.¹⁶
“As far as they are concerned, the only reasons anyone could oppose their preferred ideologies are racism and transphobia and they name Republicans as villains, in writing!”¹⁷
Congress granted the NEA its federal charter in 1906 with one mission: “elevate the character and advance the interests of the profession of teaching; and to promote the cause of education in the United States.”¹⁸
“Seeing as their leadership — and by extension, the organization itself — has morphed into a far-left insane asylum that is actively destroying the cause of education, that charter is no longer defensible,” Sanzi said.¹⁹
The Trump Administration fired back hard.
“If the NEA spent as much time focused on improving literacy and math instruction for students as it does on ideological and partisan grandstanding, student achievement might not be at a historic low,” said Ellen Keast, deputy press secretary for the Department of Education.²⁰
Translation: Maybe if teachers taught reading instead of pronouns, American kids wouldn’t be falling behind every developed nation on Earth.
Republican lawmakers are moving to strip the NEA’s special federal charter.
Representative Josh Brecheen (R-OK) is leading the charge.
“Congress established the NEA in 1906 to support America’s teachers and strengthen our schools, but it has abandoned that mission in favor of a radical agenda,” Brecheen said.²¹
“From branding President Trump a fascist to embracing divisive gender ideology and walking away from efforts to fight antisemitism, the NEA has become nothing more than a partisan advocacy group.”²²
The NEA’s federal charter gives them legitimacy they haven’t earned and don’t deserve.
That special status should be revoked immediately.
Parents figured out the con years ago.
Since 2019, more than one million families fled union-controlled government schools for charter schools, private schools, and homeschooling.²³
They’re voting with their feet because they finally understand what the NEA really cares about.
It’s not their children. It’s not education. It’s not even the teachers paying dues.
It’s power. Political power to push a radical left-wing agenda while your kids fall further behind in reading, math, and science.
These leaked documents prove conservatives were right all along about what’s happening in America’s classrooms.
The only question left is whether Republicans in Congress have the guts to do something about it.
¹ Josh Christenson, “Largest US teachers’ union to host training that attacks Republicans as ‘racist and transphobic,'” New York Post, November 21, 2025.
² “Leaked NEA Training Coaches Teachers To Fight Conservative Parents, Paint Republicans As Racist Threat,” Daily Caller, November 21, 2025.
³ “Uncovered docs show top teachers’ union guiding gender transitions, bashing conservatives: ‘Insane asylum,'” Fox News, November 20, 2025.
⁴ Josh Christenson, “Largest US teachers’ union to host training that attacks Republicans as ‘racist and transphobic,'” New York Post, November 21, 2025.
⁵ “Leaked NEA Training Coaches Teachers To Fight Conservative Parents, Paint Republicans As Racist Threat,” Daily Caller, November 21, 2025.
⁶ Josh Christenson, “Largest US teachers’ union to host training that attacks Republicans as ‘racist and transphobic,'” New York Post, November 21, 2025.
⁷ “Uncovered docs show top teachers’ union guiding gender transitions, bashing conservatives: ‘Insane asylum,'” Fox News, November 20, 2025.
⁸ “Leaked NEA Training Coaches Teachers To Fight Conservative Parents, Paint Republicans As Racist Threat,” Daily Caller, November 21, 2025.
⁹ “Teaching hate, hiding truth: NEA’s real agenda revealed in leaked handbook,” Fox News, July 28, 2025.
¹⁰ “A Dairy Queen owner went to war against Biden-Harris officials for this surprising reason,” Patriot Pulse, 2025.
¹¹ “National Education Association (NEA),” InfluenceWatch, September 8, 2025.
¹² “Never mind its lies — the NEA is nothing but the Left’s piggy bank,” Freedom Foundation, April 21, 2022.
¹³ “As NEA commits to fight ‘fascist’ Trump, lawmakers target union’s federal charter,” Oklahoma Council of Public Affairs, July 17, 2025.
¹⁴ “National teachers’ union once again prioritizes political agenda, social activism,” American Experiment, July 8, 2025.
¹⁵ Josh Christenson, “Largest US teachers’ union to host training that attacks Republicans as ‘racist and transphobic,'” New York Post, November 21, 2025.
¹⁶ Ibid.
¹⁷ Ibid.
¹⁸ Ibid.
¹⁹ Ibid.
²⁰ Sarah D. Sparks, “Can the National Education Association Win Over Republican Members?” Education Week, July 8, 2025.
²¹ “As NEA commits to fight ‘fascist’ Trump, lawmakers target union’s federal charter,” Oklahoma Council of Public Affairs, July 17, 2025.
²² Ibid.
²³ “Teaching hate, hiding truth: NEA’s real agenda revealed in leaked handbook,” Fox News, July 28, 2025.
kommonsentsjane 