The Day 'Big Short' Investor Michael Burry Reminisced About Dow's Largest Single-Day Fall In 2008: Wondered 'If This Could Be Worse'

Big Short’ investor Michael Burry expressed skepticism on the global economic environment and questioned whether it could be worse than the 2008 financial crisis in September 2022.

What Happened: The investor, who made his fortune betting against the housing market in the years leading to 2008, shared a link to a story that discussed the Dow’s largest single-day drop on Sept. 29, 2008, when the House voted against a proposed $700-billion rescue of the financial system. The index had dropped 777 points, its largest single-day drop in history until that point.

See Also: Jim Cramer Lists 6 Conditions For Market Selloff To End Amid 'Discouraging' Inflation Data

“I wondered aloud if this could be worse than 2008. What interest rates are doing, exchange rates globally, central banks seem reactionary and in CYA mode. One of my analysts said it was spooky that today I would wonder that alpine. Anniversary,” Burry said in a tweet that he deleted later.

Interestingly, the Dow witnessed more intense single-day drops until Sept. 30, 2022. During the pandemic year of 2020, the index witnessed single-day drops of over 7% three times in the month of March.

Why It's Important: Burry’s skepticism came at a time when rising interest rates and persisting hawkishness among central bankers battered global assets. The hawkish stance adopted by the U.S. Fed, despite signs of inflation having peaked at the time, kept the markets extremely volatile. Experts like ARK Investment Management’s Cathie Wood criticized the U.S. Fed’s policy stating it is significantly more restrictive than in the 1980s.

The Vanguard Total Bond Market Index Fund ETF BND and the iShares Core US Aggregate Bond ETF AGG lost over 4% in a one-month period leading up to Sept. 30, 2022. The SPDR S&P 500 ETF Trust SPY, which tracks the S&P 500, was down over 8% from the beginning of the year until Sept. 30, 2022.

This story was originally published on Sept. 30, 2022.

Read Next: Rob Reich Thinks Kitchen Tables Are Better Economic Indicators Than Stock Markets, GDP: 'In America, It's Expensive Just To Be Alive'

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Posted In: NewsShort IdeasGlobalEconomicsMarketsTrading IdeasGeneralARK Investment ManagementCathie WoodICYMIInflationMichael BurryThe Big Short
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