Michael Burry, the hedge fund manager who famously shorted the mortgage market before the financial crisis of 2008, is posting on Twitter again. His recent postings have followers nervous about a potential market crash the size of that which followed the housing market meltdown that he “predicted” 14 years ago.
Burry — written about in Michael Lewis’ 2010 book “The Big Short” and brought to the screen in the 2015 movie of the same name — tweeted a May 24 warning to followers that is in line with his cryptic, vaguely predictive messages over the years.
“As I said about 2008, it is like watching a plane crash. It hurts, it is not fun, and I’m not smiling,” Burry stated in his message, which has since been deleted.
As Bloomberg reported last June, Burry — at that time — tweeted a sequence of messages about overvalued stocks and the unsustainability of meme and cryptocurrency investment, an unsustainable paradigm that he felt could eventually lead to the “mother of all crashes.”
With the S&P 500 down 17% since the beginning of the year and, according to Nasdaq, recently flirting with bear market territory, worrying about a market crash is understandable. Predictions of a looming recession in the face of the fight to tame inflation are unavoidable.
Burry’s tweet comes during a streak of seven weeks of declines in the S&P 500, the worst run since 2001. CNN’s Fear & Greed Index, “used to gauge the mood of the market,” is sitting at 13%, directly in the middle of the “extreme fear” indicator. The housing market also is cooling significantly after a hot run of over two years.
Although nothing is ever truly deleted in the world of Twitter and social media posting, Burry usually deletes his tweets and has erased his account on a number of occasions — most recently after inquiring about shorting crypto in October of last year, according to Yahoo!, and after calling out Elon Musk in Nov. 2021, per Fox Business.
Tweeting something slightly incendiary sometimes grabs the attention of the SEC, which he has acknowledged. “Tweeting and getting in the news lately apparently has caused the SEC to pay us a visit,” said Burry in a since-deleted March tweet, per Yahoo! Finance.
Regardless of their lifespan and level of flippancy, the head of Scion Asset Management’s tweets are noted by many passive stakeholders and active business leaders alike, who are interested in how he sees the market and how it might affect their investments.
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