Netflix/The Big Short
- Michael Burry, whose lucrative wager on the US housing bubble’s collapse in 2007 was captured in “The Big Short,” expects Tesla stock to implode in a similar fashion.
- “Well, my last Big Short got bigger and bigger and BIGGER too,” the Scion Asset Management boss tweeted. “Enjoy it while it lasts.”
- Burry highlighted that Tesla gained about $60 billion in market capitalization on Thursday, the equivalent of General Motors’ entire market value.
- The Scion chief disclosed in December that he’s shorting Tesla, slamming its stock price as “ridiculous.”
- Visit Business Insider’s homepage for more stories.
Michael Burry, the investor whose billion-dollar bet against the US housing market was immortalized in “The Big Short” by author Michael Lewis, predicts Tesla stock will suffer a similar downfall.
“Well, my last Big Short got bigger and bigger and BIGGER too,” Burry tweeted on Thursday. Tesla’s stock price jumped 8% that day alone, adding $60 billion to its market capitalization – equivalent to “1 GM, 2 Hersheys, 3 Etsys, 4 Dominos, 10 Vornados,” he continued.
“Enjoy it while it lasts,” the Scion Asset Management founder and boss added.
Burry revealed in December that he’s shorting Tesla, and called for CEO Elon Musk to capitalize on his electric-vehicle company’s “current ridiculous price” by issuing shares. “Sell that #TeslaSouffle,” he added.
Tesla stock skyrocketed about 740% in 2020 and has climbed 16% already this year, granting the automaker a bigger market cap than Facebook and making Musk the richest man in the world.
Burry was portrayed by Christian Bale in the movie adaptation of “The Big Short.” He has adopted the Twitter name “Cassandra” – a reference to the priestess from Greek mythology who was cursed to share true prophecies, but never to be believed.
Indeed, Burry was almost universally dismissed when he predicted the housing bubble would burst and began snapping up credit-default swaps on subprime-mortgage bonds in May 2005. He weathered immense pressure from investors to return their money before the wager paid off.
A wave of mortgage defaults eventually tanked the housing market in 2007, and Burry personally raked in $100 million and made $750 million in profits for his investors.
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