GOOG Stock: AI Hype vs. Reality

Alright, so Alphabet's market cap just blasted past $3.5 trillion. Trillion! As in, more money than most countries dream of. And everyone's patting themselves on the back, especially after those Q3 numbers came in looking like a Powerball winner. Google Search is still printing money, Google Cloud is actually starting to look like a contender, and YouTube's still raking it in.

But then there's Michael Burry. You know, the "Big Short" guy? The one who made a fortune betting against the housing market back when everyone else was too busy flipping houses and snorting mortgage-backed securities? Yeah, that guy.

He's been Tweeting... or X-ing, or whatever the hell it's called now... about how these "hyperscalers" are committing "fraud" by understating depreciation. Fraud! He's accusing companies like Alphabet of cooking the books to make their earnings look better.

The Accounting Games

His argument, boiled down, is that these tech giants are stretching out the lifespan of their assets – servers, data centers, the whole shebang – to avoid taking a hit on their bottom line. It's like saying your car will last 300,000 miles when you know damn well it'll be in the junkyard at 150,000. Burry claims Alphabet doubled the "network/compute useful life" since 2020. Sneaky.

And he's calling out Oracle and Meta specifically, saying they're overstating earnings by a HUGE margin. 26.9% for Oracle and 20.8% for Meta, if you're keeping score at home. Those figures are insane. Is GOOG Stock a Buy or Sell as Michael Burry Accuses Hyperscalers of ‘Fraud’?

Of course, Alphabet’s stock price hasn’t seemed to notice. It's been chugging along, hitting new highs like it's fueled by unicorn tears and investor delusion. Maybe because everyone’s too busy drooling over AI and cloud growth to care about boring stuff like… you know… accounting.

But here's the thing: Burry's not some random dude shouting into the void. He's got a track record. He saw the housing crash coming when everyone else was blind. So, when he starts throwing around words like "fraud," people tend to listen. Or at least they should.

The AI Hype Train

And let's be real, the whole AI thing is starting to feel a little... frothy. Everyone's throwing money at it, hyping it up, and pretending like it's going to solve all our problems. But are we really building the future, or just inflating another bubble that's going to burst and leave a whole bunch of investors crying into their empty wallets? I mean, what happens when the AI winter comes?

Even if AI is legit, there's the whole regulatory thing hanging over Alphabet’s head. The EU is already breathing down their neck about "fair" access to publisher's websites on Google Search. They're worried Google's site reputation policy is screwing over news outlets and other websites. If the EU decides against Google, they could get fined up to 10% of their total worldwide turnover. That’s like, a gazillion dollars.

Then again, maybe I'm being too cynical. Maybe Alphabet really is worth $3.5 trillion. Maybe AI really is the future. Maybe Michael Burry's just a broken clock who got lucky once. But something about this whole situation just feels… off.

So, Should You Sell?

The analyst types are still mostly bullish on GOOG. They point to the strong Q3 results, the growth in cloud, and YouTube's potential. One of them even said Alphabet doesn't have enough "respect" for its Waymo self-driving business. Give me a break.

They're saying that Alphabet has managed to maintain its dominant market position in Search and has several growth drivers that can take the stock higher. Fine. But at a forward P/E multiple of 26.7x, it's not exactly a steal.

I ain't selling my existing positions just yet, but I sure as hell ain't buying any more. I'm going to wait and see what Burry drops on Nov. 25th. Because if he's right about the accounting stuff, this whole party could come crashing down faster than you can say "subprime mortgage."

So, Is This the Beginning of the End?

Look, I don't know if Burry's right or wrong. But I do know that Wall Street has a long history of ignoring red flags until it's too late. And the combination of sky-high valuations, accounting shenanigans, and regulatory threats makes me nervous. Real nervous. Maybe it's time to take some profits and run for the hills. Or, at the very least, keep a close eye on that Nov. 25th date.