Posted on 04/03/2021 2:00:06 PM PDT by SeekAndFind
Michael Burry's Twitter habit led to a visit from federal regulators.
"The Big Short" investor has blasted Tesla, bitcoin, Robinhood, and meme-stock buyers.
Burry indicated that he's not planning to tweet anymore.
Michael Burry's incendiary tweets have piqued the interest of federal regulators, the investor revealed this week.
"Tweeting and getting in the news lately apparently has caused the SEC to pay us a visit," the Scion Asset Management boss said in a now-deleted tweet.
"Lovely," he continued, adding the hashtag "#nomoretweets." He also linked to the song "Lovely" by Suicidal Tendencies, a hardcore punk band, and changed the header image on his Twitter profile to a pile of bricks.
Burry shot to fame after his billion-dollar bet against the US housing bubble in the mid-2000s was spotlighted in the book and the movie "The Big Short." His Scion fund owned $225 million of US stocks at the end of 2020, including roughly $30 million of bullish call options on both Pfizer and Citigroup, and $20 million in Kraft Heinz calls.
The investor has used Twitter to warn of speculative bubbles in markets and predict a devastating crash. He's also tweeted criticism of Tesla - which he's short - as well as bitcoin, Dogecoin, Robinhood, and the GameStop buying frenzy this year. On the other hand, he recently praised Volkswagen and said he owned a stake in the automaker's largest shareholder, Porsche SE.
Burry signaled he was taking a break from Twitter earlier this month, telling his followers he had made his views clear. His latest tweet suggests he's not planning a return anytime soon.
It's unclear which of Burry's tweets attracted regulatory attention. The SEC declined to comment. Scion didn't immediately respond to a request for comment from Insider.
(Excerpt) Read more at markets.businessinsider.com ...
Michael James Burry is an American investor, hedge fund manager, and physician. He founded the hedge fund Scion Capital, which he ran from 2000 until 2008, before closing the firm to focus on his own personal investments. Burry is best known for being the first investor to foresee and profit substantially from the subprime mortgage crisis that occurred between 2007 and 2010.
Burry started the (now defunct) hedge fund Scion Capital, funded by an inheritance and loans from his family. The company was named after Terry Brooks' The Scions of Shannara (1990), one of his favorite novels.
Burry quickly earned extraordinary profits for his investors. According to the author Michael Lewis, "in his first full year, 2001, the S&P 500 fell 11.88%. Scion was up 55%. Burry was able to achieve these returns by shorting overvalued tech stocks at the peak of the internet bubble (i.e. investing to profit if the value of the stocks fell, rather than rose). The next year, the S&P 500 fell again, by 22.1%, and yet Scion was up again: 16%. The next year, 2003, the stock market finally turned around and rose 28.69%, but Mike Burry beat it again—his investments rose by 50%. By the end of 2004, Mike Burry was managing $600 million and turning money away."
In 2005, Burry started to focus on the subprime market. Through his analysis of mortgage lending practices in 2003 and 2004, he correctly predicted that the real estate bubble would collapse as early as 2007. Burry's research on the values of residential real estate convinced him that subprime mortgages, especially those with "teaser" rates, and the bonds based on these mortgages, would begin losing value when the original rates were replaced by much higher rates, often in as little as two years after initiation. This conclusion led Burry to short the market by persuading Goldman Sachs and other investment firms to sell him credit default swaps against subprime deals he saw as vulnerable. This analysis proved correct, and Burry profited accordingly.
Well, what did he do to deserve an SEC ambush?
I thought he closed Scion Capital?
I’m definitely not an expert on the stock market, but if he was involved in naked short selling (i.e., selling shares that they do not actually own), he probably won’t get much sympathy from the man on the street. I don’t know if he was doing that or not. But even regular short selling probably won’t win him a lot of friends among the small folks.
I remember a story (but not the details) of a man who bought up every single last share of a small company. Even then, many shares of the stock (that didn’t actually exist) were still being sold short on the market. He was amazed, since he owned every single share of the company, and he wasn’t selling any. It’s the kind of thing that caught the big boys with their hand in the cookie jar regarding Gamestop recently.
My opinion of Twitter and Facebook is not favorable. I don’t have an account with either one, and from what I see are a vanity message board for individuals and a megaphone for politicians. No thanks.
He had the original instruments written by the big banks to bet against the housing market. I think in the end he was up 529%.
He supposedly actually read the bundled MBS’s to find out what exactly was in them. He’s a one eyed, autistic, former MD turned investor.
Well, what did he do to deserve an SEC ambush?
Simple, one does not yell fire in the house of Wall Street.
… he owned every single share of the company, and he wasn’t selling anyDo tell: how did that story end?
I have seen that movie twice it is well worth watching.
Well, what did he do to deserve an SEC ambush?
Simple, one does not yell fire in the house of Wall Street.
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That’s about the size of it.
The book itself is very enjoyable, as is entirely typical of Michael Lewis’ books.
The book is somewhat fascinating. But also depressing. Alan Greenspan had the authority to curtail the excesses of the banks which led to this collapse. He gave Congress the incredibly lame excuse that he believed the banks would be more responsible and careful (my paraphrase).
IMO Greenspan has always been the egghead-doosh that he has always seemed.
Regarding the book, I am regularly astonished by Michael Lewis' access to the main characters, from Michael Burry to Billy Beane to Leigh Anne Tuohy (although he's known Sean since childhood). That adds drama to what otherwise would be dry and depressing stories--he's the best contemporary storyteller I know.
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