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Michael Burry maintains bearish outlook on stocks despite S&P 500 reaching new record highs

Investor Michael Burry remains skeptical of the current stock market rally, warning that the S&P 500 could face a sharp decline similar to the 1987 crash. Despite the index reaching a new record high on Tuesday, Burry argues that falling volatility is encouraging investors to increase leverage, which may overextend the market. Burry continues to hold profitable short positions in several companies, including Caterpillar, Palantir, Tesla, and Micron Technology, though his bet against Nvidia remains underwater. He acknowledges the strong performance of AI-driven stocks like Palantir and Caterpillar, but warns that today's high demand could eventually lead to future "ghost towns" as capacity becomes underused. While the market continues to gain on firm corporate results and falling oil prices, Burry's stance highlights the risks of crowded positioning. He maintains that while a crash is not guaranteed, the current mechanical market structure suggests a possible major top is near.

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