Who Is Michael Burry?

The ‘Big Short’ investor is known for predicting the subprime crisis

Who Is Michael Burry?

Michael James Burry is both an American investor who founded the hedge fund Scion Capital in 2000 using a small inheritance and a physician who specializes in neurology. Among investors, he is best known for being one of the few who predicted the subprime mortgage crisis that lasted from 2007 to 2010. He shorted the 2007 mortgage bond market by swapping collateralized debt obligations (CDO) and made a personal profit of $100 million and $700 million for his investors. In 2008 he shut down Scion Capital to focus on his personal investments and then, in 2011, he incorporated Scion Asset Management, a private investment firm he still runs today based in Saratoga, Calif., which is in Silicon Valley.

Burry was portrayed by Christian Bale in the 2015 film The Big Short, which offered a fictionalized version of some key players in the subprime mortgage crisis. Director Adam McKay cowrote the Oscar-winning screenplay with Charles Randolph, which they adapted from Michael Lewis’s nonfiction book The Big Short: Inside the Doomsday Machine. In addition to Burry’s short on the mortgage bond market, he is known for his prescient opinions on money and investing that can lead investors to healthy returns. He is sometimes called “the Big Short investor.”

Key Takeaways

  • Michael Burry is an investor who profited from the subprime mortgage crisis by shorting the 2007 mortgage bond market, making $100 million for himself and $700 million for his investors.
  • Burry shut down his hedge fund, Scion Capital, in 2008. In 2011, his private investment firm, Scion Asset Management, was incorporated.
  • In April 2022, Burry tweeted that the Fed “has no intention of fighting inflation.”
  • Burry holds an M.D. and is licensed to practice medicine in California, but does not.

Personal Life and Education

Michael James Burry was born in 1971 and raised in San Jose, Calif. When he was two he lost his left eye to a rare form of cancer called retinoblastoma. He has worn a prosthetic eye since then.

Burry earned his bachelor’s degree in economics at the University of California, Los Angeles, where he also studied premed. He then got an M.D. from Vanderbilt University School of Medicine and later began residencies at Stanford University in neurology and pathology. During his education Burry used his spare time to focus on investing. Though he left Stanford after his third year in residency in neurology at Stanford University Hospital to concentrate full time on investing, he keeps up his license with the Medical Board of California by taking continuing education courses.

Burry has a wife and two adult sons, one of whom was diagnosed with Asperger’s Syndrome as a boy, which prompted Burry to discover that he too has the condition. As portrayed in the film The Big Short, he is also known for being a huge enthusiast of heavy metal music.

$300 Million

Michael Burry’s net worth as estimated by Celebrity News Net Worth.

What Kind of Investor Is Michael Burry?

Burry, whom author Lewis calls “obsessive,” comes up with strategies that diverge from the herd mentality, as he did when he shorted the mortgage bond market for CDOs in 2007. He considers himself a value investor. He has also been highly critical of government financial policy, especially that of the Federal Reserve.

In a 2010 New York Times op-ed called “I Saw The Crisis Coming. Why Didn’t the Fed?,” Burry wrote that “our leaders in Washington either willfully or ignorantly aided and abetted the [real estate] bubble. And even when the full extent of the financial crisis became painfully clear early in 2007, the Federal Reserve chairman [Ben S. Bernanke], the Treasury secretary [Henry M. Paulson], the president [George W. Bush] and senior members of Congress repeatedly underestimated the severity of the problem, ultimately leaving themselves with only one policy tool: the epic and unfair taxpayer-financed bailouts…. It did not have to be this way.”

More recently, on April 14, 2022, Burry tweeted, “The Fed has no intention of fighting inflation. Serial half-point hikes are getting elevation before stocks and the consumer tap out. Same with rapid-fire QT. The Fed’s all about reloading the monetary bazooka, so it can ride to the rescue & finance the fiscal put.”

What Was the Subprime Crisis or Meltdown?

The subprime meltdown was the sharp increase in high-risk mortgages that went into default beginning in 2007, contributing to the Great Recession, the most severe economic downturn since the Great Depression. The housing boom of the mid-2000s—combined with low interest rates at the time—prompted many lenders to offer home loans to individuals with poor credit. When the real estate bubble burst, many borrowers were unable to make payments on their subprime mortgages.

What Is ‘The Big Short’?

The Big Short is a 2015 film adaptation of author Michael Lewis’s best-selling book of the same name. The movie, cowritten and directed by Adam McKay, focuses on the lives of several American financial professionals, including Burry, who predicted and profited from the buildup and subsequent collapse of the housing bubble in 2007 and 2008.

Published in 2010, The Big Short: Inside the Doomsday Machine was a loose sequel to Lewis’ best-selling Liars Poker, a chronicle of his work experiences at Salomon Brothers in the 1980s. Both nonfiction works offer a deep dive into the lives, workplaces, and psychology of several Wall Street professionals and the financial world.

What Are Scion Capital and Scion Asset Management?

Scion Capital was a hedge fund founded by Burry in 2000. He shut it down in 2008 to focus on personal investments. In 2013, he founded Scion Asset Management LLC, a private investment firm that he manages today. The firm had $201 thousand in assets under management as of March 2022, according to Stockzoa.

The Bottom Line

Burry likely will be best known for being one of the few investors who predicted the subprime mortgage crisis that lasted from 2007 to 2010. He shorted the 2007 mortgage bond market by swapping CDOs and profited mightily from it.

Article Sources
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  1. Vanity Fair. "Betting on the Blind Side."

  2. Vanderbilt School of Medicine. "These Doctors Mean Business."

  3. PitchBook. "Scion Asset Management Overview."

  4. W.W. Norton & Company. "The Big Short: Inside the Doomsday Machine."

  5. Internet Movie Database. "The Big Short."

  6. Gregory Zuckerman. "The Greatest Trade Ever: The Behind-the-Scenes Story of How John Paulson Defied Wall Street and Made Financial History," Page 73. Crown, 2009

  7. LoudWire. "Legendary Investor Michael Burry Leaves Twitter, Lists 8 Metal Bands in Bio."

  8. Celebrity News Net Worth. "Michael Burry's Net Worth."

  9. The New York Times. "I Saw the Crisis. Why Didn't the Fed?"

  10. Markets Insider. "'Big Short' Investor Michael Burry Warns Inflation Will Hit the Stock Market — and Says the Fed Isn't Trying to Curb Rising Prices."

  11. Federal Reserve History. "Subprime Mortgage Crisis."

  12. W.W. Norton & Company. "Liar’s Poker."

  13. Stockzoa. "Scion Asset Management."

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