The hedge fund manager, Michael Burry, is stirring animal spirits on Wall Street yet again by doubling down on his bearish stance.
Burry, who became famous for his bet against the US housing market, a prelude to the 2008 financial crisis, tweeted (now deleted) on September 7 that the bottom of the market has not yet been reached.
Over the past few months, he has been very bearish on the market, and market participants are taking note as a legendary figure on Wall Street is de-risking his portfolio and predicting more pain in the broader markets.
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Checklist manifesto
On September 7, Burry shared a checklist of signals that he looks for that led him to believe that a correction in the markets is coming, this too he shared via a tweet. In essence, the declines in cryptocurrencies, meme stocks, and special purpose acquisition companies (SPACs) were the building blocks of his checklist.
Furthermore, the meltdown in 2000 and 2008 are on the list with 2022, possibly hinting that he sees a similar cataclysmic event occurring by the end of this year.
Market expert
With the sour sentiment in the investing world, market participants are turning to experts like Burry, and for good reason, as it seems that he has a knack for finding opportunities in bear markets and also predicting when major corrections are coming.
It also seems that Burry’s conviction is stronger than ever that a crash will happen, not just by the fact that he left just one stock in his portfolio, but by the sheer volume of Twitter activity that he has undertaken over the past few months, sharing his view on the ‘silliness’ in the markets.
Regardless of whether a 2008-type crash is coming or not, investors would do well to keep some dry powder on the side to invest in their favorite companies if a correction occurs, but as the adage says, ‘time in the market, beats timing the market.’
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