- Michael Burry predicts a lower CPI in 2023 that could plunge the U.S. economy into a recession.
- Burry is famous for accurately predicting the mortgage crisis of 2007 to 2010 from which he made a huge profit by shorting the market.
- The ‘Big Shorts’ hero thinks the signs of a recession are clear, considering that fundamental bear market indicators have persisted.
Famous American investor Michael Burry has predicted that the U.S. economy will go into recession by the second half of 2023. According to Burry, the inflation level has reached a peak. However, it is not the last peak of the current cycle. He notes that the next inflation spike will be characterized by the response by the Federal Reserve to the impending recession and the government’s effort to stimulate the economy.
In his recent tweet, Burry predicts that the CPI will fall to lower levels, initiating a series of events to lead to another inflation spike.
Burry, an inspiration for a prominent character in the 2015 film “The Big Short”, portrayed by Christian Bale is famous for his consistency in predicting the markets. His accurate prediction of the mortgage crisis of 2007 to 2010 was what shot him into the limelight. He shorted the 2007 bond market, making over $100 million in personal profit. Recently, he has been vocal about the current market developments, and as expected, hit the bullseye with most of his predictions.
In June 2021, prior to the current bear market, Burry predicted a crash in the digital assets market. In a now-deleted tweet, he described the then-expected crash as the ‘biggest market bubble in history’. Shortly afterward, the markets fell from their all-time highs, with many assets losing over 80% of their value.
In April 2022, Burry warned of an impending crash of U.S. stocks, as he considered them heavily overvalued. Since then, almost all the major stocks in the U.S. have fallen in price as the entire economy struggles to stay afloat.
The inflation rate in the U.S. soared to a peak level of 9.1% in June 2022. As of November, it dropped to 7.1%, even though the economic factors behind the soaring inflation persist. Falling interest rates, COVID-19 complications, and the Russian invasion of Ukraine have all impacted the economy.
In a recent Tweet, Burry explained, saying:
The Fed will cut and the government will stimulate. And we will have another inflation spike. It’s not hard.
Burry thinks that the signs of a bleak economic future are clear and not difficult to figure out. According to him, the community needs to brace itself.
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