https://finance.yahoo.com/news/big-shorts-michael-burry-compares-223347547.html Anyone have thoughts on this? I feel like all he's really getting at is that when large chunks of the market are concentrated that tail events can be catastrophic.
BREAKING: Man has alternate view of the market. News at 11.
The economy still seems to be doing ok... The thing I that worry about is all the ETFs with computers doing a bulk of the trading. If the market drops "x" percentage that triggers a stop loss order. This lowers the price so it triggers someone else's stop loss. Like the flash crash
I am surprised that this post is not trending at all. I read his stories about 2008 crisis. His idea is that there are a lot of good fish and bad fish in the pot. When there are certain % of bad fish than good fish, the system can fail easily. The only tech stock on his portfolio in 2019 is Google. He’s a very interesting self-made investor.Undergraduate in economics and doctor degree in medical. Also Robert Shiller shares the similar view as him.
He only gets involved when he has something to lose. Maybe he's hoping people go to small caps since he's into small caps.
On a second pass it looks like he's comparing indexes to the cdos from 2008, in that they're not based on fundamentals but rather models built around fundamentals, and are unrested in adverse market conditions.
I wouldn't consider ETFs as toxic as cdos that were worthless. There is a lot of value in them. Are they considered a little pricey right now? Perhaps, but the value is still there.