Home Business ‘Big Short’ legend bets $1.6 billion on imminent stock market crash

‘Big Short’ legend bets $1.6 billion on imminent stock market crash

'Big Short' legend bets $1.6 billion on imminent stock market crash

Legendary investor Michael Burry rose to fame when he correctly predicted the 2008 United States real estate market crash. Now Burry makes another bold prediction: He’s banking heavily on an imminent stock market crash.

Legendary investor bets 90% on stock market crash

Burry is betting a whopping $1.6 billion on a Wall Street crash. According to documents filed with the US regulator, Burry’s fund is betting $866 million on so-called “So Options” against the S&P 500 and $739 million against the Nasdaq 100. In fact, he’s betting more than 90% of his total portfolio on this expected stock market decline.

What is striking is that he already posted an infamous tweet with the simple “sell” back in January. However, the stock markets developed much better than expected this year. This was mainly due to the increase in artificial intelligence (AI) or artificial intelligence. He had to admit a few months later that he was wrong and shouldn’t say it. However, he has now deleted all his tweets in protest against Elon Musk.

This time Burry says nothing but bets heavily on an expected decline. His fund has also sold large amounts of shares in local US banks, including First Republic Bank. This bank was saved from collapse earlier this year when JPMorgan took over the bank.

It is unclear why the well-known investor expects a stock market crash. However, there are signs that the economy is faltering. Burry is also known for the movie The Big Short, where he was played by famous actor Christian Bale. Its notoriety is attractive bearish The prediction is currently receiving a lot of attention.

What does this mean for bitcoin and crypto?

Then what about crypto? Last year, when all markets were falling sharply, Bitcoin (BTC) and the broader crypto market still showed a very high correlation with stock markets like the S&P 500 and Nasdaq 100. This year, however, this correlation has fallen sharply again and the prices are no longer moving in tandem.

Nevertheless, there are of course great fears among crypto investors that a stock market crash would not leave crypto untouched. This can create great fears in the markets and there is a good chance that these fears will spread to cryptocurrencies as well. In such situations, many investors still prefer to pull their money out of riskier assets. Still, bitcoin has remained remarkably stable lately, even behaving significantly less volatile than the stock markets.

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