'Big Short' investor Michael Burry warned stocks would crash and rallies wouldn't last. Here are 6 of his key tweets in 2022, and what they meant. – Yahoo Finance

“The Big Short” investor Michael Burry suggested the S&P 500 could plunge below 1,900 points.
The Scion Asset Management chief based his prediction on how past crashes have played out.
Burry said brief rallies were likely, and joked about his penchant for premature predictions.
Michael Burry, the hedge fund manager of “The Big Short” fame, rang the alarm on the “greatest speculative bubble of all time in all things” in the summer of 2021. He warned the retail investors buying up meme stocks and cryptocurrencies that they were headed towards the “mother of all crashes.”
The Scion Asset Management chief’s grim prediction may be coming true, as the S&P 500 and Nasdaq indexes tumbled by 19% and 33% respectively in 2022. In tweets posted in May 2022 then subsequently deleted, Burry took credit for calling the sell-off, explained why he expects further declines, and cautioned against buying into relief rallies.
The pandemic crash was just the start
The S&P 500 index has rebounded strongly from the pandemic crash in the spring of 2020, rising from a low of 2,192 points to around 3,800 points today. However, it could halve in value to below 1,900 points over the next few years, Burry tweeted on May 3, 2022.
When the S&P 500 has crashed in the past, it has traded lower several years later, Burry noted. He pointed to the index bottoming 13% lower in 2009 than it did in 2002, 17% lower in 2002 than it did during the Long-Term Capital Management fiasco in 1998, and 10% lower in 1975 than in 1970.
If the benchmark index follows that historical pattern, it could trade 15% lower than its level in the spring of 2020, Burry said.
There may be epic but short-lived rallies
A “dead cat bounce” refers to a temporary rebound in stock prices after a significant fall, often because speculators buy shares to cover their positions.
They often occur during major declines in the stock market, Burry said in a May 4 tweet. The implication is that investors shouldn’t get their hopes up about any rallies in the coming months, as they’re likely to be brief respites that won’t result in a market recovery.
Burry noted that 12 of the 20 largest one-day rallies in the Nasdaq index took place as the dot-com bubble burst, while nine of the S&P 500’s 20 biggest one-day rallies occurred in the aftermath of the Great Crash in 1929.
 
Don’t be fooled by stocks rebounding
Stocks could stage multiple rallies before the crash is over, Burry warned in a May 5 tweet.
He noted that after the dot-com bubble burst, the Nasdaq rallied 16 times by more than 10% — gaining on average 23% each time — on its way to a 78% decline at its nadir.
Burry also emphasized that after the Great Crash of 1929, the Dow Jones index rallied 10 times by more than 10%, rising by an average of 23% each time, before bottoming at a 89% decline.
 
Stocks are on a dangerous trajectory
The US stock market appears to be following the pattern of previous bubbles, leaving it poised for a monumental crash, Burry noted in a May 8 tweet.
The Scion chief pointed to the S&P 500’s trajectory over the past 10 years, noting it was strikingly similar to the index’s chart for the decade leading up to the dot-com crash, and the Dow’s chart for the 10 years before the Great Crash of 1929.
Burry suggested that human nature was behind the consistently decade-long buildups, and implied that history is repeating itself.
Burry predicts correctly, but early
Burry appeared to take a victory lap in a May 10 tweet, suggesting he believes the stock-market crash that he’s been warning about has finally arrived.
The Scion boss joked he was early with his prediction, just as he was during the mid-2000s US housing bubble.
Burry also nodded to Elon Musk calling him a “broken clock” last year, after the Scion chief bet against Tesla stock, predicted it would collapse in value, and questioned Musk’s motives for selling his company’s shares.
 
Stocks are set to tumble a lot further
Investors can expect stocks to fall a lot further, Burry warned in a May 11 tweet.
The investor noted that 5.2 times Microsoft’s outstanding shares were traded between the software stock’s peak during the dot-com bubble and its bottom in 2002. That figure was 3.3 times during the financial crisis, but had only reached 0.5 times at the time of his tweet.
Burry noted it was a similar story with Amazon and JPMorgan, indicating it could be a while before those stocks and others bottom out.
Read more: We interviewed the CEOs of 4 of Warren Buffett’s most iconic businesses. Here are their 16 best quotes about the investor, Berkshire Hathaway’s ownership, and navigating the pandemic and inflation.
Read the original article on Business Insider
Cash flow remains king.
Coventry Group Ltd ( ASX:CYG ), might not be a large cap stock, but it received a lot of attention from a substantial…
Price branded himself as a model corporate leader who put employees’ interests ahead of his own. Two dozen former employees say otherwise.
Bank of America’s chief economist warned on Sunday that 2023 would be a “difficult” one for Americans due to economic factors that he predicted could trigger a recession. When asked by CBS’ Margaret Brennan on “Face the Nation” to give a forecast on the economy this year, Michael Gapen said he agreed with the notion…
The good people of the internet need to know.View Entire Post ›
"Please submit applications in the DMs.”
While specific segments of the commercial real estate (CRE) market such as industrial and healthcare are performing well, others like office and retail are alarming investors. Rising interest rates are heightening those concerns. In response, investors are actively reducing their exposure to the CRE market. According to The Wall Street Journal, real estate investment trusts (REITs) are fighting to stop investors from pulling their money out. Blackstone Inc. (NYSE: BX) announced a tightening of r
Over $20 million worth of drugs were seized in Hall County, according to authorities.
As if rising mortgage rates and high house prices aren’t enough, homebuyers in the new year are going to have to contend with higher fees to obtain their credit reports. In some instances, a credit report will cost 400% more in 2023 than it did in 2022.
Macro Trends Advisors founding partner Mitch Roschelle breaks down the U.S.'s historic home price correction.
The law pertains to companies with more than 15 employees.
The federal government will allow you to save nearly 10% more for retirement in 2023. Only 14% of participants saved the maximum amount in 2020. Not everyone needs that kind of money put away for retirement.
We all pay taxes. So why not get some of that money back?
It's also known as the Pareto principle. As a case in point, look at where Warren Buffett and his team have invested Berkshire Hathaway's (NYSE: BRK.A) (NYSE: BRK.B) money. Berkshire has stakes in 47 companies.
In 2017, business magnate Warren Buffett did something that’s somewhat unusual for him. He poured hundreds of millions of dollars into a real estate investment. Buffett has been dismissive of real estate investing in the past. He’s called it a “lousy investment” in part because real estate can be expensive to maintain. Real estate also often requires “sweat equity” or the physical effort needed to upgrade properties or simply keep them from falling into disrepair. Yet in 2017, Berkshire Hathaway
Investors get a chance to think about what will drive the market in 2023 after stocks posted the worst year since the 2008 financial crisis.
Buyer’s remorse is likely to take on a more sinister turn in the coming months, as people who purchased their houses at the top of the market take out their frustrations on their real estate agents. Historical precedent suggests that as housing values stagnate and then fall, the “last batch” of buyers often become resentful — so much so that they may lash out at their agents or other professionals involved in the process, according to Victor Insurance Managers.
Today we'll do a simple run through of a valuation method used to estimate the attractiveness of Alphabet Inc…
If the economy stays robust in 2023, the Fed will make good on its threat of boosting rates above Wall Street’s expectations. That would be more bad news for stocks.
Howard Fischer, a 63-year old investor living north of New York City, has a wish for when he dies. Maybe his composted remains could be planted outside the family home in Vermont, or maybe they could be returned to the earth elsewhere. “Whatever my family chooses to do with the compost after it’s done is up to them,” Fischer said.

source