The investor who called the 2008 housing crash now says the AI boom is close to breaking, which would be bad for stocks, banks, and taxpayers.

• Michael Burry has shifted to riskier bets against AI stocks and pulled his timeline forward, expecting a bust within a year.
• The market looks strong but isn't: five big tech stocks — Microsoft, Meta, Apple, Alphabet, and Nvidia — drove almost all of the S&P 500's recent gains.
• AI companies have borrowed heavily to build data centers, and banks are on the hook for hundreds of billions in loans.
• Economists at Capital Economics see late-stage bubble signs, saying AI profit forecasts are far ahead of what the economy can deliver.
• OpenAI has floated the idea of the government acting as insurer of last resort, which reads as planning for failure and setting up another bailout fight.

Outlook: A single bad earnings quarter from a big AI name could trigger a sharp market drop, with bailout demands following fast.