Thread by @babaeiramtin

Why is @michaeljburry selling everything? And why did he buy $GEO?

#inflation #recession #stocks #StockMarket

A thread 🧵

1/7 Micheal Burry became known for his successful bet against mortgages in the run-up to the 2008 financial crisis. In a May tweet, he warned of a crash like the one 14 years ago.

2/7 Michael Burry's investment firm Scion Asset Management sold 11 U.S. stocks in the second quarter - ending the period with just one: Geo Group. Position disclosure is required for all asset managers that manage more than $100 million worth of U.S. stocks.

3/7 In one of those recent tweets, Burry explained that global supply chain restructuring will continue to drive inflation. "Onshoring/labor shortages plus global supply chain restructuring raise long-term inflation floor even as bullwhip cycles decline"

4/7 Besides the economic part of his tweet, Burry's post also contains a pessimistic assessment of the geopolitical situation. For example, he expresses the assumption that China could initiate an attack on Taiwan in the coming year.

5/7 In addition, he considers it possible that the Ukraine war could spill over to the European Union via Lithuania.

6/7 And why did he buy Geo Group? GEO Group is an American company, specializing in the operation and management of private prisons and mental health facilities. Burry may be anticipating civil unrest and social tension in the United States.

7/7 Overall, Burry is quite pessimistic and sees the current recovery in the markets as only short-term. He also assumes that the geopolitical situation in Europe will get worse. There are many variables in the economy & politics, no one knows exactly how it will turn out.

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