12/9/2023 0 Comments Michael burry housing bubble 2021![]() It compares a company's market capitalization to its revenues, instead of its profits or net assets.īurry is best known for his massive bet against the mid-2000s US housing bubble, which was immortalized in the book and movie "The Big Short." He also paved the way for the meme-stock craze by investing in GameStop before its shares skyrocketed in January 2021, and made high-profile bets against Elon Musk's Tesla and Cathie Wood's flagship Ark Innovation ETF last year. The investor likely used the price-to-sales ratio because it's more speculative than price-to-earnings, or price-to-book value. Presumably, Burry wanted to show the index is trading at nearly twice the revenue of its constituents - indicating the valuation multiples on America's largest public companies have stretched to unsustainable heights. The ratio was below 1.0 for most of the 1990s and 2000s, but it has nearly doubled over the past decade to north of 1.9 today, the chart showed. "Nigh perched with a multiple problem," Burry tweeted, attaching a chart tracking the price-to-sales ratio of the S&P 500 equal-weight index. ![]() Michael Burry, the investor of "The Big Short" fame, warned US stocks are heavily overvalued and poised to tumble in a now-deleted tweet on Monday night. ![]() "The Big Short" investor noted the S&P 500's price-to-sales ratio has nearly doubled in 10 years.īurry has been raising the alarm on a historic market bubble, and predicting an epic crash. Michael Burry cautioned US stocks are hugely overvalued and could plummet in price.
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