Prominent analyst and hedge fund manager Michael Burry is back in the public eye with a new opinion on the financial markets. As a reminder, after the last rather bearish forecast a week ago, the market moved to the upside and Burry deleted his Twitter account.
Has Michael Burry become a bull?
Now, the investor, who has returned to the media field, stated that this time things are different. Burry's words might seem like a change of heart, but an examination of the attached chart suggests that this is hardly an amendment to his previous call to sell everything.
February 7, 2023
The graph offered by Burry for public viewing shows a comparison of the Effective Federal Funds Rate and the S&P 500 Index in 2001 and 2002. It can be seen that the decline in the effective interest rate index is paralleled by a decline in the stock market index. Thus, Burry makes it clear that when the U.S. Federal Reserve begins to pivot its monetary policy, one should not expect financial markets, and cryptocurrency in particular, to rise in the medium term.
Thus, while the markets are behaving contrary to Burry's predictions so far, as they did in the late 2000s, this is only a short-term picture so far. Time will again tell who is right over the longer term.