‘The Big Short” Investor Michael Burry created ripples in the financial market as he took a dig at the Federal Reverse big tech giants, alarming the stock market.
Burry tweeted a research paper, putting forward how unsustainable the stock market is, especially how the Feds are misleading people.
In subsequent tweets, he dismantled the lies spread by the big tech companies and accused the Federal Reserve of misleading the public.
Burry is known for the billion-dollar bet he took against the US housing bubbling, which was the talk of the town after the movie and the book “The Big Short” were released. This laid the foundation stone for GameStop its Meme-stock boom.
The Stock Market Imbalance
The tweet highlighted how the stock market value gained $5 for every $1 investment, indicating the stretching of prices. This could increase significantly as millennials invest via passive things like index funds instead of direct stock purchase.
Adding that the imbalance is a product of a paradigm that could reverse, he highlighted how the 5:1 ratio is getting impractical with time. The 5:1 can well go down to -5:1 or go up to 100:1. It’s an unstable situation.
The Feds Misleading the Public?
Burry went on to blast the Feds for downplaying the inflation threat by putting up flattering inflation gauges. He sighted a Wall Street article that showed a higher inflation reading which remained unchanged in July and August.
Overhyped Tech Giants & Crypto Market
Burry had earlier supported the #BoycottAmazon and #BoycottFacebook trend on Twitter, asking people not to support tech giants and buy from them.
He even highlighted the Facebook Files investigation done by Wall Street, which spoke about tech giants ignoring the detrimental effect of social media. Highlighting the issue of political campaigning, he said tech executives had asked to find dirt on Donald Trump to support Hillary Clinton.
Earlier, the investor warned traders how fragile the stock market is, making it poised for crashes. He further spoke against the hype surrounding Tesla, Bitcoin and the cryptomarket and Cathie Wood’s Ark Invest. He labelled it as breathless hype.