Michael Burry Ditches Gold as US CPI Cools
Michael Burry, the founder of Scion Asset Management, has recently decided to sell his entire position in Sprott Physical Gold Trust ($PHYS). Over the past six months, the trust recorded a 23% increase, and gold acted as a protective measure against inflation.
The decision of Burry to close this position may indicate some changes in his view on the economic situation, especially taking into consideration the slow down of inflation in the US.
Burry Bullish Shift Towards Consumer Spending and the US Dollar
In addition to selling his gold position, Michael Burry has made a significant bet on the US consumer and the strength of the dollar. He has taken a substantial stake in Shift4 Payments ($FOUR), a payment processing company serving over 200,000 businesses in sectors like retail, hospitality, and restaurants.
This position now makes up 13.97% of Burry’s portfolio, showing that he still believes in consumer spending.
This decision is timely given that the latest retail sales figures for July revealed a 1% increase, which is much higher than the predicted 0.3%. Burry’s investment in Shift4 Payments seems to be a strategic move to benefit from this continuing consumer sentiment.
Investments in Real Estate Signal Confidence in Recovery
Expanding his investment range, Burry has also invested in the real estate investment trust, Hudson Pacific Properties ($HPP), which has lost more than 49% of its value in the current year.
Burry, who has been famous for his bearish approach to investment, seems to be betting on the rebound of the beaten-down commercial real estate.
Hudson Pacific Properties has not been performing well of late but Burry’s bet can be seen as him thinking that the company is set to bounce back especially if the Federal Reserve decides to reduce rates, which is usually positive for the real estate sector.
Conclusion
In conclusion, Michael Burry’s decision to sell his gold position and invest in consumer-related stocks and real estate trusts indicates a shift in his investment approach, reflecting his confidence in the US economy’s recovery.
Burry’s investment decisions are always closely watched by the market, and this move is no exception. As the economic landscape continues to evolve, it will be interesting to see how Burry’s investments perform and whether his views on the US economy and its recovery continue to shift.
FAQs
Q: Why did Michael Burry sell his gold position?
A: Burry sold his gold position as he believes that the slow down of inflation in the US is a sign of a more stable economic environment, making it less necessary to hold onto gold as a protective measure.
Q: What are Michael Burry’s new investment strategies?
A: Burry has invested in consumer-related stocks, such as Shift4 Payments, and real estate trusts, such as Hudson Pacific Properties, indicating a shift towards a more bullish approach to investment.
Q: What does this move say about the US economy?
A: Burry’s investment decisions are seen as a sign of confidence in the US economy’s recovery, indicating that he believes the country is on the path to a more stable and growing economic environment.
