"Big Short" Investor Michael Burry Says "the Fed Has No Intention of Fighting Inflation"
Hedge fund manager Michael Burry, famed for forecasting the 2008 financial crisis, says that the Federal Reserve “has no intention of fighting inflation.” He added that the Fed’s “Serial half-point hikes are for getting elevation before stocks and the consumer tap out.” Michael Burry on Inflation and Fed’s Rate Hikes
Famous investor and founder of investment firm Scion Asset Management, Michael Burry, shared his thoughts Thursday on the U.S. economy, inflation, and interest rate hikes.
He is best known for being the first investor to foresee and profit from the U.S. subprime mortgage crisis that occurred between 2007 and 2010. He is profiled in “The Big Short,” a book by Michael Lewis about the mortgage crisis, which was made into a movie starring Christian Bale.
Burry tweeted Thursday: The Fed has no intention of fighting inflation. Serial half-point hikes are for getting elevation before stocks and the consumer tap out.
“Same with rapid-fire QT [quantitative tightening]. The Fed’s all about reloading the monetary bazooka. So it can ride to the rescue & finance the fiscal put,” Burry added.
At the time of writing, his tweet has been liked 13.8K times and retweeted over 2.2K times. Many people on Twitter agreed with Burry.
One user wrote, “It is correct that the Fed would like room to ease again.” Another noted: “Not just the Fed. Look at all the central bankers around the world raising rates at similar times and similar basis points. Canada and China around the 24th of this month by 50bps. This is coordinated and they think it will work without any major collapse.” A third user opined, “Anyone who doesn’t blame the Fed for out-of-control housing inflation is gaslighting you.”
The rate of U.S. inflation jumped to a 40-year high of 8.5% in March and showed little sign of quickly reversing, according to data released this week. However, many people believe that inflation is much worse than the reported number.
Gold bug Peter Schiff commented Thursday: “According to the government March consumer prices rose by 8.5% YoY. Consumer prices are composed of the prices we pay for the stuff we import and the stuff we produce ourselves. But March YoY import prices rose 12.5% and export prices rose 18.8%. That’s an average rise of 15.65%!”
The president of the Federal Reserve Bank of St. Louis, James Bullard, has repeatedly warned that the Fed needs to raise rates much faster to fight inflation. He told the Financial Times this week that it is “fantasy” to think the Fed can bring inflation down sufficiently without raising rates to a level that constrains the economy.
Meanwhile, Federal Reserve Governor Christopher Waller believes that inflation peakedin March. He said Thursday: “I’m forecasting that this is pretty much the peak. It is going to start to come back down.” Tags in this story fed inflation, fed rate hikes, inflation, michael burry, michael burry inflation, michael burry interest rate hikes, michael burry warning, Peter Schiff
Do you agree with Michael Burry? Let us know in the comments section below. Kevin Helms
A student of Austrian Economics, Kevin found Bitcoin in 2011 and has been an evangelist ever since. His interests lie in Bitcoin security, open-source systems, network effects and the intersection between economics and cryptography. ECB to Cease Bond Purchases in Q3, Lagarde Says EU’s Economic Rebound "Crucially Depends on How the Conflict Evolves" ECONOMICS | 14 hours ago Inflation Rises Sharply in the US as Consumer Prices in March Spiked to 8.5% ECONOMICS | 3 days ago
Image Credits: Shutterstock, Pixabay, Wiki Commons Previous articleJapan’s Top Messaging App LINE Launches Marketplace With 40,000 NFTs Next articleAmazon CEO: Crypto Will Become Bigger, NFTs Will Grow ‘Very Significantly’ Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article. Read disclaimerShow comments More Popular NewsIn Case You Missed ItUS Bond Markets Signal Economic Downturn, Trend Forecaster Says if War Ensues "Odds of Recession Increase"
As Americans continue to deal with rising inflation, on Tuesday the spread between 2-year and 10-year Treasury yields inverted, signaling the U.S. economy may be headed for a recession. This week, a myriad of financial reports have noted that the ... read more.Leading NFT Marketplace Opensea to Add Solana Support in April 19 Million Bitcoin Have Been Mined Into Circulation, 2 Million Left to Be Found Bandai Namco Announces Gundam Themed Metaverse India"s Crypto Trading Volume Plummets as New Tax Rules Enter Into Force