Washington, D.C., June 26, 2026 (GLOBE NEWSWIRE) -- In 2008, a small group of investors and analysts saw warning signs that much of Wall Street missed.
Among the most well-known were Michael Burry, whose story was later featured in The Big Short, hedge fund manager John Paulson, who famously profited from the collapse of the housing market, and financial author Jim Rickards, who spent years studying systemic financial risks and market vulnerabilities.
Burry's bet against subprime mortgages personally netted him $100 million, while making his investors $700 million. Paulson's trade went further still, returning $15 billion to his fund, $4 billion of which went to Paulson himself. By their own accounts, they saw the crash coming before the rest of the market did.
Today, all three names continue to attract attention whenever they speak about markets. Burry has since made a $1.1 billion bet against artificial intelligence. And in a new free presentation, Rickards explains why he believes investors may be overlooking a series of developments unfolding inside the artificial intelligence boom.
The New Concern
Artificial intelligence has become one of the most popular investment themes in modern market history.
Trillions of dollars in market value have been created as investors bet that AI will transform industries ranging from healthcare and finance to transportation and manufacturing.
Rickards agrees that AI could become one of the most important technologies of the century.
His concern is not the technology itself.
Instead, he focuses on the unprecedented amount of capital, debt, and investor expectations now tied to the AI story.
According to Rickards, periods of extraordinary optimism often deserve closer scrutiny, particularly when valuations begin depending on future outcomes that have not yet arrived.
A few of the data points Rickards points to in the presentation:
- According to the Chair of Investment Strategy at JPMorgan, three-quarters of the S&P 500's gains since the launch of ChatGPT have come from AI-related stocks.
- One AI chipmaker recently became the first company in history to be valued at $5 trillion, despite owning none of the factories that manufacture its products.
- Research from MIT found that 95% of corporate AI initiatives have so far failed to produce a measurable return on investment.
- Analysts at Deutsche Bank estimate one major AI company will need to absorb $143 billion in negative cash flow before turning a profit — more than the combined market cap of the three largest U.S. automakers.
- Oliver Wyman, a firm regularly hired by major banks to stress-test risk, estimates a serious AI-linked market correction could erase approximately $33 trillion in value, more than the size of the entire U.S. economy.
- Billionaire investor Stanley Druckenmiller and venture capitalist Peter Thiel have both exited their entire Nvidia positions in recent months. Norway's $2.1 trillion sovereign wealth fund, one of the largest and historically most conservative in the world, has also pulled back from AI and data center investments.
Rickards points to a pattern he has studied closely: large amounts of debt being used to finance infrastructure buildouts ahead of proven, sustainable revenue. He notes that some industry observers have drawn direct comparisons between current AI infrastructure financing and the securitized lending structures that preceded the 2008 financial crisis.
Why July 29th Matters
In the presentation, Rickards points to July 29th as a date he believes investors should watch closely.
That's the date a major AI-linked company Meta, is expected to release earnings.
Rickards believes an earnings miss from this company could be the catalyst that shifts investor sentiment, the way a handful of earnings misses preceded the dot-com crash in 2000.
Rickards has studied what he calls the "Minsky Moment," a term coined by economist Hyman Minsky to describe the point where a market built on increasingly speculative borrowing suddenly reverses. He points to the lead-up to the 2000 dot-com crash, when the Nasdaq fell nearly 80%, and the 2008 financial crisis as past examples of this pattern playing out.
Rickards believes the AI sector may be approaching a similar inflection point, and that this upcoming earnings report could be the trigger that brings the gap between AI spending and AI profitability into sharp focus for the broader market.
About the Presentation
Jim Rickards lays out his full analysis and explains why he believes July 29th could become one of the most important dates of the summer for investors, in a free presentation now available to view. Click HERE to watch.
About Jim Rickards and Paradigm Press
Jim Rickards has advised the U.S. Treasury, the Federal Reserve, the White House, and the Department of Defense across five decades in government and finance. He later built financial threat-detection systems for the CIA and designed the Pentagon's first financial war games. In 2007, he delivered formal testimony to the U.S. Treasury warning of the conditions that led to the 2008 financial crisis.
Paradigm Press is one of the most widely read independent financial research publishers in the United States, rated 4.8 stars on Google across more than 1,900 reviews. Free from advertiser influence, Paradigm Press is committed to helping everyday Americans understand the forces shaping their wealth.
Derek Warren Public Relations Manager Paradigm Press Group Email: dwarren@paradigmpressgroup.com