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'Big Short' investor Michael Burry sounds the recession alarm, warning the US economy faces a multi-year downturn

Added 11-30-22 08:14:02am EST - “Burry has predicted a slump in consumer spending, a blow to company profits, and economic pain as households move closer to exhausting their savings.” - Markets.businessinsider.com


Posted By TheNewsCommenter: From Markets.businessinsider.com: “'Big Short' investor Michael Burry sounds the recession alarm, warning the US economy faces a multiyear downturn”. Below is an excerpt from the article.

Michael Burry has sounded the recession alarm, warning the US economic downturn will probably last several years as he sees no way to end it early.

"What strategy will pull us out of this real recession?" he said in a now-deleted tweet on Tuesday. "What forces could pull us so? There are none. So we are really looking at an extended multi-year recession."

The investor of "The Big Short" fame seems to be suggesting the Federal Reserve and US government have few good options to shore up growth. He has previously accused policymakers of fueling inflation by flooding the economy with money during the pandemic, and warned that could make it tougher and more expensive to stimulate growth in the future, especially if doing so would fuel price increases.

Burry has been predicting a recession for a while. In June, he noted Americans — faced with surging prices and higher interest rates — are saving less, borrowing more, and poised to virtually exhaust their savings by Christmas. Those trends threaten to hammer consumer spending, erode corporate profits, and spark an economic downturn, he said.

The Scion Asset Management founder also noted in his latest tweet that other commentators are forecasting a mild, short-lived recession, not a deep and protracted one.


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