Michael “Big Short” Burry hints at 2008-style crash in cryptic tweet

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In a later-deleted tweet, legendary American investor Michael Bury offered an ominous warning about a 2008-style crash that he believes could soon come to inflict more pain on US markets. Is.

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Bury, the founder of Scion Asset Management, rose to fame after anticipating the collapse of the US housing market, as described in Michael Lewis’ book “The Big Short”, which was later adapted into a Hollywood film.

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What Bury said in the now-deleted tweet: “As I said about 2008, it’s like watching a plane crash. It hurts, it’s not funny, and I’m not smiling.”

Years ago, Bury described a recurring dream he saw in 2007 as the housing market thawed. In his dreams he used to see planes crashing over and over again.

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To be sure, the context-free tweet was largely open to interpretation as Bury neglected to answer questions from Twitter users inquiring about the tweet. Bury also has a habit of deleting his tweets soon after they are published.

US stock indexes climbed in the green after Wednesday’s open, but after the worst start to the year in history for technology stocks, investors remained cautious amid fears that the stock could sharply reverse its gains at any moment.

It’s worth noting that Bury’s ambiguous tweet released US new home sales data for April saw a nearly 30% drop compared to April 2021, according to data from the Census Bureau and the Department of Housing and Urban Development.

And in other economic news, the S&P Global Flash US Purchasing Managers’ Index for the services sector fell to a three-month low of 53.5 in May, up from 55.6 in the previous month, a sign that the all-important US services sector is entering a period. are doing. Why contraction?

But the data isn’t all bad: While inflationary pressures have been widely blamed for driving a sharp re-rating in global equities, particularly in the US, a quick look at the five-year break-even rate in the US – a measure of the difference between the five-year nominal yield and the five-year yield on inflation-protected securities, which is viewed as a gauge of inflation expectations five years into the future – shows that it is lower than 2.9% has come down, a decline of about 30 basis points within a week. This would suggest that long-term inflation expectations are starting to calm down, despite Bill Ackman’s complaints that the Fed is still not doing enough to quell insensitive price pressures.

About a year ago, Bari warned that markets were headed for the “mother of all crashes”. Months later, US stocks and bonds fell as the Federal Reserve discussed its plans for a series of rapid interest rate hikes. More clues about the Fed’s thinking are expected later on Wednesday when the central bank will release minutes from its two-day policy meeting earlier this month, during which it voted to raise its benchmark policy rate by 50 basis points. did.

Credit: www.marketwatch.com /

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