Famous for predicting the global financial crisis in 2008, then dubbed “The Big Short” for his bet on falling stocks, Michael Bury is now delivering his most dire warning about the US economy, which he says will be worse than the Great Recession.
Bury, who is president of Scion Asset Management, noted that one of his market analysts said his comments were “scary” because he expressed his concerns on Sept.
It was classified at the time as the largest daily decline in the history of the industrial index.
“Today I wondered aloud if this could be worse than 2008,” Bury said in a deleted tweet.
The Dow plunged nearly 500 points before Barry’s tweet and fell more than 20% from its high of 37,000 points, pushing it into bear market territory, according to the New York Post website, which was seen by Al Arabiya.net.
The Federal Reserve and other central banks around the world have rushed to raise interest rates in recent months in an effort to tame decades-high inflation.
The World Bank and others have warned that central banks risk causing a global recession as they push ahead with rapid and synchronous interest rate hikes despite signs of slowing economies.
It is noteworthy that a movie called “The Big Short” was made in 2015, in which Bury was portrayed as the hero, which highlighted the story of his bet against the housing market in the United States, as he was one of the many prominent voices warning of global economic conditions that could potentially be dangerous.
Earlier last week, former Treasury Secretary Larry Summers, a frequent critic of the Fed’s belated response to inflation, warned that levels of global economic risk are similar to those seen in 2007 before the Great Recession.
“In the same way that people became anxious in August of 2007, I think this is a moment when anxiety should be growing,” Summers told Bloomberg.
Like Barry, Summers noted that there is widespread uncertainty about the policy actions of central banks as they try to stabilize economies.
For its part, the Bank of England was forced to intervene last week after the value of the British Pound plunged to an all-time low.
Investors were nervous after the UK government backed sweeping unfunded tax cuts and spending increases – a plan that raised fears of worse inflation.
Bury has amassed more than a million followers on Twitter, where he often shares – and quickly deletes – his thoughts on the state of the economy and politics.
A month ago, a hedge fund wizard said that a stock market slowdown that he predicts will be the “mother of all crashes” is now happening.
Bury also raised eyebrows after disclosing in August that his company sold off its entire financial portfolio during the second quarter, shedding shares of big names such as Alphabet (parent to Google) and Meta (parent to Facebook).