Michael Burry is one of the most intriguing investors of our generation. His “Big Short” success in 2008 made him a legend. A single correct trade turned his life around and made him a permanent fixture in financial media ever since. The problem is that many retail investors now take his every tweet and prediction as gospel.
Zoom out and look at the track record since 2009. A very different story emerges. For the last decade, Burry has predicted market collapses, global catastrophes, and asset bubbles on repeat. Many times, he has even forecasted dates. All of it turned out to be false. Meanwhile, markets have continued to rally, with the S&P 500 reaching all-time highs along the way.
In this post, I take a look at Burry’s biggest predictions since 2017 and what investors can learn from his long streak of inaccurate calls.
Michael Burry is Betting Against AI
A recent piece on Investopedia highlights that Michael Burry, the famed investor who called the 2008 housing market collapse, is now placing big bets against the AI sector.
In particular, the firm’s filing of put-options on big AI stocks (NVDA and PLTR in particular) suggests a conviction that valuations are stretched and that a major pullback is on the horizon.
This move isn’t just a headline. It also holds value for retail investors and raises important questions about how to react. When someone with Burry’s track record takes such a contrarian move, it’s not about copying blindly. Instead, there are some take-aways and lessons that individual investors should keep in mind.
What the move means
- Burry’s recent put-option purchases on companies such as Nvidia and Palantir (NVDA and PLTR, respectively) indicate that there is a chance the recent AI boom is entering a blow-off phase or experiencing bubble-like behaviour.
- It’s important to remember that even the most bullish narratives and companies can become overvalued – and that the risk of a downward correction may be a meaningful possibility.
- This move also highlights that in the investment world, it’s crucial to separate potential problems from ongoing successes.
Why Burry’s Recent Track Record Is Important to Investors
It is one thing for great investors to be early. It is also fine for them to be wrong. But the problem comes when retail investors treat every dramatic prediction as a foregone conclusion.
The truth is that Burry is not a macro forecaster. He is a deep value stock picker. The “Big Short” trade was a bet against mispriced credit risk. It was not a wager on his ability to read the macro economy. Burry being right in 2008 did not make him a repeatable predictor of global crashes.
Most investors forget that context. They only remember the movie.
So let’s look at a timeline of Burry’s recent calls since 2017 and the real outcome since then.
A Timeline of Burry’s Recent Calls and What Actually Happened
Here is a simple, data-backed summary of Burry’s major calls since 2017.
| Date | Burry’s Prediction | What Actually Happened |
|---|---|---|
| Jan 2017 | Predicted a global financial collapse and even WW3 were imminent. | No collapse occurred. Markets rallied strongly for years. |
| Sep 2019 | Said index funds would implode like CDOs from 2008. | Index funds kept growing as passive investing became the default strategy for millions. |
| Dec 2020 | Shorted Tesla and called its price “ridiculous.” | Tesla continued climbing and doubled again. |
| Jan 2021 | Repeated prediction that Tesla’s valuation would implode soon. | Tesla kept rising. |
| Jan 2021 (late) | Claimed GameStop’s rally would not repeat. | GameStop exploded again just weeks later. |
| Feb 2021 | Warned the entire market was “dancing on a knife’s edge.” | The S&P 500 hit new all-time highs. |
| Feb 2021 | Said inflation would destroy Bitcoin. | Bitcoin reached new highs later that year. |
| Feb 2021 | Called Robinhood a “dangerous casino” that would lose users and revenue. | Robinhood’s user base and revenue continued growing at massive scale. |
| Mar 2021 | Declared Bitcoin a speculative bubble. | Bitcoin kept rallying to record highs. |
| Jun 2021 | Predicted the “mother of all crashes” and sold everything. | No crash occurred. The market is up more than 56% since. |
| Sep 2022 | Forecasted massive stock failures ahead. | A new bull market started two months later. |
| Jan 2023 | Bet $1.6B on a total market crash and tweeted “Sell.” | He later admitted he was wrong. The market is up more than 63% since. |
Why Do Retail Investors Listen to His Predictions?
The real question is why Burry’s predictions continue to go viral among retail investors. There are three main reasons for that.
1. The “Big Short” Bias
It is natural for humans to assume that a person who once made one perfect call would do it again. We love stories about prophets. But history suggests that one right call does not make someone perpetually accurate.
2. Dramatic Predictions Are Viral
A calm message will never go viral. But dramatic calls spread like wildfire. Investors subconsciously gravitate toward the loudest voices. Warnings give a higher emotional payoff because they are linked to fear.
3. Preparing for Disaster Makes People Feel Smart
Bearish forecasts allow investors to feel prudent and intelligent. It also feeds a confirmation bias that they can see something that others are missing.
In reality, the biggest risk in investing is not missing the crash. It is missing long-term compounding.
Zooming out: what did the market actually do?
If you zoom out and compare market performance to those predictions, the difference is staggering.
- The market has rallied more than 56 percent since Burry’s June 2021 crash call.
- The market is up more than 63 percent since his January 2023 “Sell” tweet.
- Bitcoin has hit new all-time highs even after he called it dead multiple times.
- Passive investing continues to dominate even after he compared index funds to CDOs.
- The long-term trend has completely diverged from his calls.
The Danger of Authority Bias in Investing
Authority bias is the psychological trap that we give too much credit to a person just because of their reputation.
In investing, this is extremely dangerous. Even legendary investors like Buffett, Dalio, Ackman, and Druckenmiller have long lists of wrong predictions.
Not a single investor gets the macro environment right on a consistent basis.
The moment you stop your own research and follow another person’s conviction instead of your strategy, you end up:
- Missing long bull markets
- Selling at the bottom
- Buying at the top
- Staying in cash for years
- And losing the benefits of compounding.
Your financial future then gets tied to someone else’s emotional swings.
The Better Alternative: Focus on System, Not Personality
Successful long-term investors do not base their strategy around personalities. They base it around rules.
Here is what works:
1. Owning great companies for long periods
Buying companies with strong competitive advantages and strong cash flow makes time your ally.
2. Stay invested even through fears and headlines
The number one reason most investors lose money is that they try to time the market. Staying invested has historically been the strongest wealth generator.
3. Use data and fundamentals, not emotion, to make decisions
Base your choices on valuation, fundamentals, growth, and positioning. Do not react to every viral tweet.
4. Accept that corrections are normal
Crashes are part of the investing journey. They are not a sign to abandon your strategy.
5. Focus on probabilities, not predictions
The probability of markets rising over long periods is far higher than the probability that one person can repeatedly call every downturn correctly.
Real Lesson from Burry’s Track Record
Michael Burry is one of the smartest people in the world. But brilliance does not equal predictive accuracy. His career after 2008 shows one consistent pattern.
He is almost always early. And if he is not early, he is simply wrong.
If retail investors had listened to every warning since 2017, they would have missed one of the strongest bull markets in history.
The lesson is simple…
You can use legendary investors as a learning resource. But never outsource your decision-making to their predictions. Build your own strategy. Stay focused on fundamentals. And let time and compounding work in your favor.
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