Michael Burry famed shorts burn as the well-known permabear suffers huge losses betting on a market crash.
Nobody said this game was easy.
Remember “Big Short”, Michael Burry tweeted one word: “sell.” earlier in the year.
“Michael Burry tweeted one word: sell.”
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Perhaps Michael Burry getting bullforked is a case of ignoring the noise
Think about it. They want you to sell so they can buy cheap.
Maybe the Fed’s definition of a soft landing to tackle inflation, could be the main street in a recession as the Fed market fixers try to ignite animal spirits in the financial market to cushion the impact on the real economy,” we wrote in a piece entitled, “Michael Burry gets bulled forked,” dated June.
So, while Main Street is going to hell in a handbasket, a market rally is ignited by several Fed rate hike pauses and the latest CPI inflation data, that excludes necessities, food, shelter, and energy.
Somehow, miraculously, the latest 30-year treasury auction that had a poor bid has become irrelevant, post the latest CPI “cooked” inflation data, and it is back to Alice and Wonderland. The 10-year treasury yields are falling, stocks are rising, and central banks are doing a victory lap on controlling inflation.
There is no need for Sherlock Holmes to figure out who is buying the debt and sending yields lower.
So, it is back to stealth QE, bond yield suppression, and the beginning of a central bank easing cycle.
This could be the seeds of a secular bull market cycle. Secular bear markets typically last about 18 months, and this one could be due to end.
“while Main Street is going to hell in a handbasket, a market rally is ignited”
Your portfolio might take a moonshot, but you could be paying, x2, x3 for a loaf of bread or any other essential service or goods.
Governments will probably step in with price controls. But that could only lead to shortages and black markets.
“I was wrong to say sell” – Michael Burry
Standby for a hyperinflationary depression?
Venezuelan stock market index (IBC) increased 37087 points or 177.05% since the beginning of 2023, despite GDP contracting 7% in the first of the year. Venezuela’s Inflation is 318%.
In this scenario, cash is trash, with even stocks being a better store of value.
Michael Burry famed shorts burn
“I was wrong to say sell,” tweeted Burry.
A third or seven of Michael Burry’s fund’s total 21 positions – were bank names, and except for Wells, they were mostly distressed, regional, small banks and/or credit card companies, such as CapitalOne, Western Alliance, Pacwest, First Republic, and Huntington Bancshares, all of which had been hammered significantly during the March bank crisis.
Michael Burry has liquidated the bulk of his shorts at undisclosed losses.
Perhaps Michael Burry famed shorts burn will morph into famed longs as the billionaire speculator rotates capital into buy positions
It is no easy game to play when all that counts is what the central banks do, and where only club members know that.