Michael Burrys Latest Predictions: $1 6 Bn Short, Long Positions Revealed

Over the past eight years, from early 2017 to late 2023, Burry issued at least a dozen high-profile predictions and trades betting on market collapses, only to watch equities climb higher, assets rally, and his timelines evaporate. US hedge fund manager Michael Burry, known for predicting the 2008 US housing collapse, smartytrade review has now sounded an alarm about Bitcoin. Burry appears to be betting on a major market downturn, while also taking long positions in some companies, as revealed by his latest SEC filing.

Michael Burry Warns Of A Market Crash Worse Than 2000, Says Brutal Selloff Is Coming

• Burry warned that if dropping to around $70,000 was pushing down the prices of more traditionally solid investments such as gold and silver, it could get even worse if Bitcoin slid down to $50,000.
• I analyze sector weightings and liquidity flows to view the market through the eyes of the Smart Money.
• He described a world teetering on the edge of catastrophe, warning that “every bit of my logic is telling me that a global financial meltdown is coming, and that it will be followed by a worldwide political meltdown as well.”
• One option is to shift funds to a more conservative investment strategy, such as investing in an equal-weighted ETF following the S&P 500 index, which removes the weighting of stocks in the S&P 500 and therefore has less exposure to the high-flying AI companies.
• He also said that the Russia-Ukraine war was dividing Western nations and that together those headwinds could hit growth stocks.

Investors who heeded his signal might have liquidated positions or shifted to cash, expecting a replay of 2008. He described a world teetering on the edge of catastrophe, warning that “every bit of my logic is telling me that a global financial meltdown is coming, and that it will be followed by a worldwide political meltdown as well.” Yet, in the years following that triumph, Burry’s public pronouncements have often veered into a pattern of repeated warnings about impending doom—warnings that have yet to materialize in the way he anticipated. However, there are some who are quite pessimistic about the future value of Bitcoin as Clem Chambers of Forbes predicted that the crypto would crash to around $60,000 and could then slide further into values of around $40,000. Burry warned that if dropping to around $70,000 was pushing down the prices of more traditionally solid investments such as gold and silver, it could get even worse if Bitcoin slid down to $50,000. The famous investor wrote that Bitcoin had dropped around 40 percent in value since the October peak and had even worse words for the possibility that the price might plunge even further.

Will Bitcoin’s Decline Trigger Ripple Effects? Here’s What The Big Short’s Michael Burry Says

The filing also revealed that Burry maintains some bullish positions, including call options on Halliburton and Pfizer, as well as share positions in Molina Healthcare, Lululemon, and SLM Corp. These are the fundamental charts of the AI sector that Michael Burry shared on his X post, which he has based his bearish put options bets on. His investing philosophy centers on deep fundamental analysis and a willingness to stand alone when his research contradicts popular narratives.

Earnings Growth Optimism

However, there are other astute investors who disagree with Burry, and ultimately, retail investors are very unlikely to correctly time the market. Historical data show that the market has consistently generated solid long-term returns and that investing in stocks is less risky when held for the long term. And so the problem is, in the United States, I think when the market goes down, it’s not like in 2000, where there was this other bunch of stocks that were being ignored, and they’ll come up even if the Nasdaq crashes. Active investing refers to the process of conducting thorough research and frequently buying and selling stocks to outperform the market and generate alpha, as there are inefficiencies to capitalize on. Michael Burry became one of the few investors to make bets against the housing market before it collapsed during the Great Recession. Other market whizzes, including the hedge fund manager David Einhorn and the "Black Swan" investor Mark Spitznagel, have called out epic levels of speculation among investors and cautioned that they’re marching toward disaster.

• This demonstrates that he’s not simply bearish on the entire market, but instead has specific concerns about AI-related valuations.
• Combined, these two positions represent about $1.1 billion in bearish bets, accounting for approximately 80 percent of Scion Capital’s entire portfolio.
• While revenue and earnings have grown, stock prices have often grown faster, expanding valuation multiples to levels that have historically preceded corrections.

The Stock Markets Ultimate Line In The Sand

Exact losses remain undisclosed, but filings suggest heavy writedowns, capping a streak where Burry’s crash calls repeatedly failed and were caught on the wrong side of a bull market repeatedly. His bet overlooked crypto’s resilience as an inflation hedge in the eyes of investors. Burry’s fund shifted defensively, but the market shrugged off his gloom, climbing another 6% in February and entering a bull phase that would last for years. Burry eventually exited the trade quietly, but the episode underscored his frustration with a market ignoring fundamentals like negative free cash flow and production bottlenecks. In a lengthy email interview with Bloomberg, he likened the trillions flowing into index funds and exchange-traded funds to the collateralized debt obligations that fueled the housing bubble. This was no vague hunch; Burry tied it to overleveraged debt markets and rising protectionism, echoing the subprime warnings that had made him famous.

Market Timing Risks Remain High For Investors

Burry’s Scion Asset Management discloses massive put options against QQQ and SPY in SEC filing. Timing the market remains a risky strategy. Burry suggests a market downturn could be widespread.

March 2021: Bitcoin’s Speculative Bubble Confirmed

Michael Burry, Jeremy Grantham, and other market commentators have for years been warning that stocks will crash and the economy will crater. The investor who saw the housing crash coming is now warning about AI—and prudent investors would be wise to understand at least why. The enthusiasm around AI has created an environment where investors have been willing to pay premium prices based on future growth expectations rather than current fundamentals. One of the investors from The Big Short has been warning of the consequences if the value of Bitcoin drops below $70,000, as prices have plummeted massively since they hit a peak late last year. While a crash isn’t imminent, investors ignoring his warnings risk exposure to overvalued tech and geopolitical landmines. One option is to shift funds to a more conservative investment strategy, such as investing in an equal-weighted ETF following the S&P 500 index, which removes the weighting of stocks in the S&P 500 and therefore has less exposure to the high-flying AI companies.

• Now, I think the whole thing is just going to come down, and it will be very hard to be long stocks in the United States and protect yourself.
• The Scion Asset Management chief sounded the alarm in 2021 on the "greatest speculative bubble of all time in all things" and declared that buyers of meme stocks and cryptocurrencies were barreling toward the "mother of all crashes."
• Spot platinum was up 2.1% to $2,272.55 per ounce after hitting an all-time high of $2,918.80 on 26 January, while palladium added 0.7% at $1,787.55.
• Today the market has institutional ETFs, greater liquidity depth, and better regulatory infrastructure.
• Burry’s position, now public knowledge, faced intense scrutiny, with short sellers collectively losing billions.

Why Big Tech Dominance Matters In A Sell-off

For Bitcoin to reach Burry’s $50,000 target, it would need to fall an additional 25% from current levels. The chart reveals a descending price channel that has been driving the cryptocurrency lower since its all-time high near $126,000. Bitcoin is currently trading at $67,274, down 8.15% in the last 24 hours. Burry posted on X a comparative chart with the simple message “$BTC Patterns,” where he draws structural similarities between the current drop—from $126,000 to $70,000—and the previous brutal plunge that took Bitcoin from $35,000 to below $20,000.