Michael Burry list
1. The Intelligent Investor, Benjamin Graham
The Intelligent Investor is a classic work on value investing and is often cited by the most successful investors in their recommendations. Benjamin Graham first published this book in 1949. Since then, it has been republished several times, and its advice has not become outdated over time.
One of the principles that Graham first formulated and Burry used in 2008 is built on the concept of “Mr. Market.” It follows from this that in the short term, the price of securities is determined not by fundamental analysis, but by investor sentiment. Graham himself writes about it this way: “In the short run, the market is a vote-counting machine, but in the long run, it’s still a scale.”
2. Common Stocks and Extraordinary Returns, Philip Fisher
Warren Buffett once said that his own approach to investing is 85% Graham and 15% Fisher.
Benjamin Graham was a dedicated value investor: he learned to accurately identify companies that would soon decline in price and return to their reasonable price. Philip Fisher, on the contrary, looked for those companies that were fairly valued and would continue to grow steadily in the future. In other words, he was a proponent of growth investing. He outlined his approach in detail in this book.
Buffettology, Mary Buffett and David Clark
Like many investors, Burry learned a lot from studying Warren Buffett's strategies. Buffettology explains his approach to investing in detail.
In 2002, the book was republished under the title New Buffetology. Regardless of the year of publication, it breaks down Buffett's most important trades in recent decades and outlines the lessons that can be learned from them.
Security Analysis, Benjamin Graham
Graham wrote The Intelligent Investor to introduce value investing to the general reader. Security analysis is a more detailed and technically challenging job, especially for those who want to delve deeper into the mechanics of value investing.
This book came in fifth place because to understand it, the average reader should first learn the basics of Graham's investment principles. This way, he will be able to understand the non-concepts that Security Analysis talks about.
Value Investing Made Easy, Janet Lowe
The subtitle of this book is "Benjamin Graham's Classic Investment Strategy Explained for Everyone." Graham's influence on Burry's investment approach is clear
Due to its value, this book deserves first place on the list; many investors recommend starting reading with it. The reason that Janet Lowe's work was at the bottom of the list is simple: it seemed too simple to Burry to be a guide to serious transactions. But to learn the basics of investing, this book is perfect.
Why Stocks Go Up and Down, William H. Pike
This book from Burry's list has not yet been translated into Russian - but it should be! For decades, William Pike's work has topped lists of recommended investing books. The ability to analyze financial statements to accurately evaluate a company is one of the basic skills of an investor.
The latest updated edition was published in 2013. There is not much theory in this book - the author places the main emphasis on the practical application of financial statement analysis, cash flow formation, stock valuation and much more.
Michael Burry, who predicted the 2008 crisis, predicts an even bigger bang
- Burry, what's going on? - It's simple. We are witnessing the greatest bubble of all time. In everything.
I don't remember the 2008 crisis. I was a poor student and therefore the gap between me and wealthy people was narrowing, and according to the relativity of movement, it seemed that I was getting richer.
Then there was the wonderful film “The Big Short” with Batman (Christian Bale) in the title role, only Batman was in sho
mouths and made money on
shorts
. And with drumsticks in hands.
“Batman” proved to the whole world that his calculations regarding the approaching year of 2008 were correct. Michael Burry then worked as a manager of the hedge fund Scion Capital and insured about a billion dollars of his clients through a credit default swap in 2005. Three years later, in 2008, when the smell of frying began, Batman earned investors (although they wanted to sue him) of his fund $700 million (489.34%) and personally pocketed $100 million.
Now Burry was alarmed again. What happened “then,” Burry says, is nothing compared to what is about to happen.
Burry tweeted, stopped, and is tweeting again.
In May 2022, Michael Burry bet half a billion dollars on Tesla's collapse. He said he had put options to sell 800,100 Tesla shares at the end of the first quarter, valued at $534 million. In February, he tweeted: "My last short got bigger, much bigger." He also commented on the growth of Tesla's market capitalization, saying that this will not last long. Burry also said last year that environmental regulatory credits that Tesla relied on to generate profits would be cut as Fiat Chrysler's sales increased. Burry compared what is happening with Tesla to the collapse of the dot-coms.
On April 6, Michael Burry deleted his Twitter account.
On June 15, Burry returned to Twitter.
“People ask me all the time what's going on in the markets. It's simple. The greatest speculative bubble of all time. Two orders of magnitude larger. #FlyingPigs360.”
On June 17, Michael Burrie warned that investors buying meme stocks and cryptocurrencies were incurring huge losses.
“All the hype/speculation is attracting retail before it causes all the crashes,” the investor wrote. “When crypto crashes by trillions or meme stocks fall by tens of billions, #MainStreet's losses will be comparable to the size of the country.”
Burry added that FOMO (people's fear of missing out) has driven asset prices to unsustainable levels. "#FOMO Parabolas don't resolve sideways"
“The problem with #Crypto, as with many things, is leverage,” he tweeted. “If you don’t know what leverage a cryptocurrency has, then you don’t know anything about cryptocurrency.”
PS
Fun fact, Michael Burry named his hedge fund Scion Capital after the book Descendants of Shannara:
Burry continues to write and delete posts on Twitter, and, at times, post heavy metal compositions:
Deathbed perspective…to be this creative as I die.
Two torches light up the way As they beckon from below To the groves of willows where The seeds of hate we sow
Michael Burry buys real assets
Summary:
- Michael Burry has been in the headlines a lot lately for his shorting of Tesla and Ark.
- But what is more important is not what he sells, but what he buys.
- Today, more than half of his portfolio is invested in real assets, and in this article we explore why?
Michael Burry of The Big Short is one of the most influential investors in the world today. He is best known for predicting and capitalizing on the subprime mortgage crisis of 2007-2010. But even before that, he was a successful investor, even profiting from the dot-com crash.
From the time his hedge fund was launched in late 2000 until it closed in 2008, it earned nearly 150 times more than the S&P 500 (SPY) over the same period. Needless to say, it's worth keeping an eye on what he does.
What is he doing these days?
Burry has been in a lot of headlines lately due to his short positions in Tesla and ARKK. And since they are some of the most popular stocks/ETFs in the world, these short bets have attracted a lot of attention.
But what's more interesting to us is what he's buying, and if you look at the holdings of his hedge fund, Scion Asset Management, one thing is immediately clear:
First of all, he buys real assets.
He has so much invested in REITs, pipelines, tankers and other infrastructure investments that the real asset component of his portfolio now exceeds 60%.
His top nine positions currently include six real asset investments:
- Оvibtiv (OVV): 13.74%
- GEO Group (GEO): 12.94%
- CoreCovic (CXW): 9.9%
- Scorpio Tankers (STNG): 9.62%
- SunCoke Energy (SXC): 8.12%
- Golden Ocean (NASDAQ:GOGL): 5.62%
And to be clear, these are not some old legacy positions that he has held for decades. Vice versa. He bought shares of all these companies in the second quarter of this year.
Moreover, at the end of the film "Big Short", the last statement states that "what little investment he still makes is focused on one product: water." In a subsequent interview, he said that the best way to invest in water is to use water-rich agricultural land:
“It became clear to me that food is a way to invest in water. That is, growing food in water-rich areas and transporting it for sale in low-water areas. This is the least controversial method of redistributing water, and it can be profitable in the long run.”
Quite interesting, isn't it?
Why is he making a concentrated bet on real assets? Why doesn't he invest in tech stocks like most people?
To answer these questions, I did some digging and found some old tweets from his now-defunct Twitter account that explain why he takes this approach. Here are three reasons why The Big Short's Michael Burry is betting on real asset investing.
Reason #1: Risk of hyperinflation
Let's start with the most obvious reason: inflation.
We all know how much the money supply has increased over the past year, and with no end in sight to money printing, Burry fears we'll end up with hyperinflation, or at least accelerating inflation:
Real assets are by definition "real" and therefore do a great job of beating inflation.
Take, for example, a home that is well located in a growing city like Austin, Texas. Its supply is limited, but its demand increases over time, and its replacement cost also rises along with inflation. This makes it an excellent hedge against inflation.
We used the example of a house here, but the same is true for most real assets. If, like Burry, you fear that we are in uncharted territory and that inflation may be on the rise, then it may make sense to increase the exposure to real assets in your portfolio.
Reason #2: The mother of all dragons of glitches
Burry believes rampant speculation in tech, crypto and memo stocks will eventually lead to the "mother of all disruptions":
You can only value big tech companies at huge multiples if inflation doesn't exist and discount rates are very low.
But if you think inflation will accelerate, then discount rates will need to be adjusted higher and the new estimate will not be sustainable:
Real assets are better protected because they generate inflation-protected returns and their valuation multiples remain reasonable even in today's low interest rate world. In this sense, Burry considers them today's refuge.
Reason #3: Value and Growth Potential
Burry isn't sure investors can get good returns by investing in big tech companies. In fact, he's selling them and thinks the stock will generate negative returns in the coming years.
However, he believes that with real assets investors can make very attractive returns even as we enter a period of soaring inflation:
Hard assets are good because they are not only subject to revaluation as inflation rises. They also generate significant income independent of market prices.
And as more investors decide to follow suit and invest more in real assets, their value is likely to skyrocket. These investments are limited in supply and with increasing demand prices must adjust higher.
How much should you invest in real assets?
This is a subjective question, and the answer should depend on a number of factors, including your risk tolerance, return goals, income needs, and your view of the current market.
But whether you agree or disagree with Burry, simply for the sake of diversification and asset protection, you should probably hold some real assets in your portfolio.
Personally, I invest about 50% of my portfolio in recommended real assets. I do this to put my money where I want it, but also because, like Burry, I don't know a better place to put my money today.
Real assets provide significant returns, protect against inflation, trade at reasonable prices, and have growth potential as more investors come to this conclusion.
Today, large investment firms already invest about 25% of their portfolios in real assets, and by 2030 this allocation could grow to 60%, according to Bruce Flatt, CEO of Brookfield, owner of $0.5 trillion in real assets:
Are Bruce Flatt and Michael Burry wrong to invest so much money in real assets? That remains to be seen, but they have a pretty good track record.
Conclusion
Michael Burry is one of the rare people who profited from the dot-com bubble, the great financial crisis and the pandemic.
Today he warns us again, all the while reducing his positions in technology stocks and increasing them in real assets that we all need.
Will you accept his warning or ignore it?
Source
Tags: inflation
Michael Burry: Governments will begin to suppress gold and Bitcoin
Governments will accelerate inflation and begin to suppress gold and Bitcoin as competitors. This point of view was presented by investor Michael Burry, who predicted the collapse of the mortgage market in the United States.
pic.twitter.com/GcvalO8WdY
— Michael Burry Archive (@BurryArchive) February 19, 2021
In the thread, the financier who became the prototype of the main character in the film “The Big Short” predicted the expansion of government incentives to overcome the crisis due to the COVID-19 pandemic.
According to Burry, it used to be necessary to borrow $3 to create $1 of GDP. Now this ratio has worsened. He drew a parallel with Germany in the 1920s, which serves as an example of the consequences of the active issuance of fiat money. Burry noted the similarity of the current situation with that which was on the eve of the surge in inflation in the United States in the 1970s.
pic.twitter.com/3ipNp7oLfM
— Michael Burry Archive (@BurryArchive) February 19, 2021
In separate posts, Burry supported his point with graphs. In them he showed how the US government, guided by modern monetary theory, is going to increase the money supply. This decision comes against the backdrop of a recovery in retail sales and business activity indices. The financier believes trillions of dollars of new stimulus will accelerate consumer demand and cause production costs to soar.
Burry also touched on the topic of bubbles in financial markets. In his opinion, they are manifested not only in such traditional metrics as Put/Call Ratio or the level of margin lending, but also in a new phenomenon - the activity of traders from Reddit.
The investor does not believe in Bitcoin because he believes that its scale is not enough to meet the needs of the global economy. He gave the example of the Swiss franc, which is not a reserve currency, despite its high degree of reliability.
At the same time, Burry clarified that he has no dislike for Bitcoin.
“I believe the long-term future for decentralized currency is fragile. Cruel, unprincipled centralized governments will not want to give up their currency monopolies. In the short term, anything is possible. That’s why I don’t go short on Bitcoin,” the investor explained.
Recall that US Securities and Exchange Commission Commissioner Hester Pierce doubted that there was a way to completely ban Bitcoin. Barry Silbert, founder of the Digital Currency Group, shares a similar opinion.
Stay in touch! Subscribe to Cryptocurrency.Tech on Telegram. Discuss current news and events at the Forum
Michael Burry from “The Short Game”: 2020-2021 – Weimar coming of age
Sunday evening update : A day after the Weimar Twitter storm and shortly after this article was published, Michael Burry tweeted the following:
They tell me that I didn’t warn you last time. In fact, he warned, but no one listened. So I'm warning you this time. And still no one listens. But I will have proof that I warned.
And indeed they will.
* * *
Goldenfront.ru : Michael Burry is an American investor who made his fortune during the collapse of the American housing market of 2007-2009, thanks to his accurate forecasts of the situation in the mortgage derivatives market. The hero of the film "Big Short".
* * *
A week ago, Bank of America hinted at the unthinkable: a tsunami of monetary and fiscal stimulus, coupled with a coming surge in monetary policy speed as the global economy emerges from lockdowns, would lead to unprecedented economic overheating.
Or, more precisely, one that has precedents, according to Bank of America CIO Michael Hartnett . He recalled Germany after the First World War, which he considers " the most striking, extreme analogue of the sharp increase in the velocity of money and inflation at a time when end-of-war psychology reigned supreme, deferred savings, loss of confidence in currency and authorities " and, in particular, the monetization of debt by the Reichsbank . He is sure that all this is very similar to what is happening today.
Table 11: The end of World War I caused a jump in the velocity of money and inflation. Columns from left to right, in %: change in money supply, budget deficit, money velocity, inflation, GDP volume
Of course, this period has another name: Weimar Germany, and since we all know what happened then, it is understandable why BofA is shy about such specifics.
Of course, there were less shy people - in 1974, Jens Parsson wrote a fascinating, insightful historical analysis of the hyperinflationary collapse of Weimar Germany under the leadership of the original money printer Rudy von Havenstein, entitled Death by Money: Lessons from the Great German and American Inflation” (Dying of Money: Lessons of the Great German and American Inflations), which we periodically remind readers of. This book is essential material for preparing for what awaits us.
Then, overnight, none other than Michael Burry of The Short, who has been making waves in the financial community lately with his hot-button posts (most recently his critique of the Robinhood trading system and bullish view on uranium), picked up the theme of Weimar and hyperinflation this period. Burry sees in it a step-by-step forecast of what awaits us and devoted a long chain of tweets to this topic, generously copying Parsson’s fundamental work.
And although the details of what happened then are familiar to most historians of monetary circulation, the sensation here is that the hero of “The Big Short” is now predicting Weimar hyperinflation in the United States. Below is a simple, clear repost of Burry's lengthy Saturday tweet, showing how similar our situation is to that which prevailed shortly before the start of one of the most explosive hyperinflationary episodes in history.
The US government encourages inflation through policies based on modern monetary theory. A buoyant government debt-to-GDP ratio, an increase in the M2 money supply as retail sales recover, and the PMI rising in a V shape. Trillions in additional stimulus and reopenings will boost demand as labor and supply chain costs rise.
“The life of inflation in its ripening stage was a paradox that had its own unmistakable characteristics. One of them was enormous wealth, at least among those who benefited from the boom... Many huge fortunes arose overnight... The cities were full of aimless and dissolute youth.”
“Prices in Germany were stable and both business and the stock market were booming. The exchange rate of the mark against the dollar and other currencies actually rose for a while, and the mark momentarily became the strongest currency in the world” on the eve of inflation.
“Next to wealth there were pockets of poverty. More and more people were left outside the easy money, looking through windows with no way to get inside. The crime rate has skyrocketed."
“The evidence of the time speaks of a progressive demoralization gripping the common people, aggravated by their weariness at breakneck speed, with no apparent purpose, and their fear of watching their own precarious positions being lost while others brazenly and recklessly grew rich.”
“Almost any business could make money. Business failures and bankruptcies became rare. The boom suspended the normal processes of natural selection by which what was otherwise unnecessary and ineffective would have been discarded.”
“Speculation itself, which added nothing to the wealth of Germany, became one of the most important areas of activity. The fever of quick earnings infected almost all classes... Everyone, starting with the elevator operator, played in the market.”
“The turnover of securities on the Berlin exchange became so high that the financial industry could not keep up with paperwork ... and the exchange was forced to close several days a week to catch up.”
“By November 1923, all the stamps that existed in the world in the summer of 1922 would not be enough to buy one newspaper or a tram ticket. That was the spectacular part of the crash, but most of the real loss in monetary wealth occurred much earlier."
“All these years, the structure was gradually built before the impact. The inflation cycle in Germany lasted not a year, but nine years—eight years of gestation and only one year of collapse.”
And the main point of his tweets: the above "was written in 1974 about the period 1914-1923" and he makes an ominous extrapolation - " 2010-2021: The gestation period" , adding that "when dollars might as well fall from heaven... management teams get creative and pile risk on risk, paying investors dividends financed by borrowed money or investing in risky projects. Prudence lies on the sidelines.”
We are there now. The only question remains when we will enter the stage of geometric currency collapse.
Michael Burrie's Scion Asset Management closed almost all positions in the stock market
Otkritie Broker JSC (Otkritie Investments brand), license of a professional participant in the securities market to carry out brokerage activities No. 045-06097-100000, issued by the Federal Securities Commission of Russia on June 28, 2002 (without validity period). Recipients of financial services can find information about Otkritie Broker JSC in the “Documents and Information Disclosure” section.
Otkritie Broker JSC is a member of the Russian National SWIFT Association.
Corporate Disclosure Center.
Information about tariff plans/tariffs is published for marketing purposes in an abbreviated version. A complete list of tariff plans/tariffs, their contents and conditions of application are contained on the website open-broker.ru in Appendix No. 2 and 2a “Tariffs” to the agreement for brokerage services/agreement for maintaining an individual investment account of Otkritie Broker JSC. You need to keep this in mind when choosing a tariff plan.
“Service” means one or more (set) of conditions for brokerage customer service, including, but not limited to: opening a specific portfolio, maintaining a separate investment account, offering a tariff plan, providing information messages to the client, as well as other conditions stipulated by the agreement and/or Regulations for customer service of Otkritie Broker JSC and/or an additional agreement with the client and/or posted on the website of Otkritie Broker JSC. You can find out more about each service on the company’s website, in your personal account, or by contacting an employee of Otkritie Broker JSC.
The remote registration service is provided for the initial opening of an account with the company.
Copyright holder of the software MetaTrader 5 MetaQuotes SoftwareCorp. The copyright holder of the QUIK software is ARKA Technologies LLC.
The information presented does not constitute an individual investment recommendation under any circumstances, including if its content appears to coincide with the requirements of regulatory legal acts for individual investment recommendations. Any similarity between the information presented and individual investment recommendations is purely coincidental.
Any of the financial instruments or transactions mentioned may not suit your investment profile.
The transactions and/or financial instruments mentioned in this communication do not under any circumstances guarantee the returns you may expect if you use the information provided to make investment decisions.
Otkritie Broker is not responsible for possible losses of the investor in the event of transactions or investments in financial instruments mentioned in the information provided.
In all cases, determining the suitability of a financial instrument or transaction for investment objectives, investment horizon and risk tolerance is the responsibility of the investor.
Cookie policy on open-broker.ru.
