Days after arguing Nvidia (Nasdaq: NVDA) mirrors Cisco‘s dot-com-era trajectory, Michael Burry follows up with a diagram naming the specific financial structure he argues obscures circular revenue at Nvidia and routes the underlying credit risk to American retirees through Apollo Global Management‘s (NYSE: APO) insurance affiliate Athene.
The diagram, titled “The Retiree/Apollo/Nvidia/Bermuda/AMAPS/xAI Pipeline,” shows Nvidia selling 100,000-plus GB200 GPUs worth $5.4 billion to Valor, a shell Special Purpose Vehicle with no operating business, while simultaneously investing $1.9 billion back into that same SPV as sponsor equity. Nvidia books the full $5.4 billion as completed-sale revenue.
Apollo arranges the financing secured by the GPUs, packages the debt into securities, and sells $3.5 billion worth to Athene — Apollo’s own insurance subsidiary. Athene holds those securities in its portfolio; American retirees, through annuity premiums, fund Athene’s balance sheet and bear the underlying credit risk.
xAI, the artificial intelligence company Elon Musk folded into SpaceX in February, receives full use of the $5.4 billion GPU cluster through a five-year triple-net lease — with no asset or debt appearing on its balance sheet.
Burry flagged four alarm bells inside Athene’s structure: $74.2 billion in total reserves; $217 billion in assets shifted to a Bermuda captive insurer outside normal US regulatory oversight; $103 billion — 34.7% of assets — sitting in Level 3, meaning they carry no observable market price; and 16x leverage on those unpriced assets.
The net effect, according to the diagram: Nvidia records a clean $5.4 billion revenue figure; Apollo collects fees across origination, structuring, distribution, and servicing; xAI secures $5.4 billion in compute capacity off balance sheet; and retirees sit at the bottom of a 16x leveraged structure holding $103 billion in assets they cannot price, carrying the credit risk unknowingly.
The May 29 post is a preview of Heretic’s Guide to AI’s Stars Part IV. The broader market backdrop gives that framing additional weight: the S&P 500’s Shiller CAPE ratio sat at roughly 41.6 in May 2026, the second-highest reading in over 140 years of US market data and just below the dot-com peak of 44.2 in December 1999.
SpaceX, which absorbed xAI in February and now carries the GPU lease obligation, filed its IPO prospectus with the SEC on May 20. The company is targeting a valuation of $1.75 trillion–$2 trillion and plans to list on Nasdaq under the ticker SPCX in mid-June in what would be the largest public debut on record.
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