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Michael Burry

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Michael Burry
Born
Michael James Burry

(1971-06-19) June 19, 1971 (age 53)
San Jose, California, U.S.[1]
EducationUniversity of California, Los Angeles (BA)
Vanderbilt University (MD)
Occupations
Known forFounding and managing Scion Asset Management

Michael James Burry (/ˈbɜːri/; born June 19, 1971)[2] is an American investor and hedge fund manager. He founded the hedge fund Scion Capital which now goes by the name Scion Asset Management.

He is best known for being among the first investors to predict and profit from the subprime mortgage crisis as well as paving the way for the GameStop short squeeze.

Early life and education

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Burry was born and grew up in San Jose, California. He has Rusyn ancestry. At the age of two he lost his left eye to retinoblastoma[3] and has had a prosthetic eye ever since.[4] As a teenager, he attended Santa Teresa High School.[5][6][7]

He studied economics and pre-med at the University of California, Los Angeles, earned an MD degree from the Vanderbilt University School of Medicine in 1997,[6] and started but did not finish his residency[8] in pathology at Stanford University Medical Center.[9] While off duty at night, he worked on his hobby: financial investing.[9]

Despite not practicing, Burry has kept his license as a physician active with the Medical Board of California, including continuing education requirements.[10][8]

Investment career

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Main article: Scion Asset Management

After medical school, Burry worked as a Stanford Hospital neurology resident, and then a Stanford Hospital pathology resident.

He then left to start his own hedge fund. He had already developed a reputation as an investor by demonstrating success in value investing, which he wrote about on message boards on the stock discussion site Silicon Investor beginning in 1996. He was so successful with his stock picks that he attracted the interest of companies such as Vanguard, White Mountains Insurance Group and prominent investors such as Joel Greenblatt. Burry has a strictly traditional understanding of value. He has said more than once that his investment style is built upon Benjamin Graham and David Dodd’s 1934 book Security Analysis: "All my stock picking is 100% based on the concept of a margin of safety."[11]

After shutting down his website in November 2000, Burry started the hedge fund Scion Capital, funded by an inheritance and loans from his family. He named it after Terry Brooks' The Scions of Shannara (1990), one of his favorite novels. He quickly earned extraordinary profits for his investors.[12]

In 2005, Burry started to focus on the subprime market. Through his analysis of mortgage lending practices in 2003 and 2004, he correctly predicted that the real estate bubble would collapse as early as 2007. His research on the values of residential real estate convinced him that subprime mortgages, especially those with "teaser" rates, and the bonds based on these mortgages, would begin losing value when the original rates were replaced by much higher rates, often in as little as two years after initiation. This conclusion led him to short the market by persuading Goldman Sachs and other investment firms to sell him credit default swaps against subprime deals he saw as vulnerable.[13][14][15]

During his payments toward the credit default swaps, Burry suffered an investor revolt, where some investors in his fund worried his predictions were inaccurate and demanded to withdraw their capital. Eventually, Burry's analysis proved correct: He made a personal profit of $100 million and a profit for his remaining investors of more than $700 million.[6]

In 2008, Burry shut down Scion due to public backlash in response to his schemes and numerous audits from the Internal Revenue Service. Burry was also motivated to close Scion to focus on other investment ventures.[16]

In an April 3, 2010 op-ed for The New York Times, Burry argued that anyone who studied the financial markets carefully in 2003, 2004, and 2005 could have recognized the growing risk in the subprime markets.[17] He faulted federal regulators for failing to listen to warnings from outside a closed circle of advisors.[17][15]

In 2013, Burry reopened the Scion hedge fund under the name Scion Asset Management. Its aim was to generate personal investments, which include water, farmland, and gold.[18]

Personal life

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Burry is married, with children, and lived in Saratoga, California in 2010.[9] His son was diagnosed with Asperger syndrome, and Burry believes he also has Asperger’s after reading about the disorder. When he was younger, he noticed that it took him a lot of energy to look people in the eye, and said, "If I am looking at you, that's the one time I know I won't be listening to you".[9][19][6]

He is a fan of heavy metal music, including bands such as Obituary, Lamb of God, Amon Amarth, Slipknot, King Diamond and Pantera.[20]

Burry was highly critical of the lockdowns during the COVID-19 pandemic in the United States.[21]

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Film

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Literature

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References

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  1. ^ Szramiakje, John (May 22, 2017). "Here's the story of one of the heroes of 'The Big Short'". Business Insider. Retrieved July 22, 2018.
  2. ^ Lang, Kevin (December 11, 2015). "The True Story Behind The Big Short - Real Michael Burry". History vs Hollywood. Retrieved July 22, 2018.
  3. ^ Gregory Zuckerman (2009). The Greatest Trade Ever: The Behind-the-Scenes Story of how John Paulson Defied Wall Street and Made Financial History. New York: Broadway Books. p. 73. ISBN 978-0385529938.
  4. ^ "The True Story Behind The Big Short - Real Michael Burry". History vs Hollywood. Retrieved April 23, 2019.
  5. ^ Zuckerman, Gregory (2009). The Greatest Trade Ever: The Behind-the-Scenes Story of How John Paulson Defied Wall Street and Made Financial History. Crown Business. ISBN 978-0-38552-994-5.
  6. ^ a b c d Lewis, Michael (1 March 2010). "Betting on the Blind Side". Vanity Fair. Retrieved July 22, 2018.
  7. ^ Carey, Pete (April 6, 2008). "Mercury News Interview: Hedge fund manager saw subprime meltdown coming". San Jose Mercury News. San Jose, California. Retrieved February 18, 2016.
  8. ^ a b Whitney, Kathy (2014). "These Doctors Mean Business". Vanderbilt Medicine. Retrieved August 18, 2023.
  9. ^ a b c d Lewis, Michael (2010). The Big Short. W. W. Norton. ISBN 978-0-393-07223-5.
  10. ^ "Licensing details for: A 68709". California Department of Consumer Affairs. Retrieved 2025-01-21.
  11. ^ "Learning From Dr. Michael Burry's Investment Philosophy". ValueWalk. December 20, 2016. Retrieved January 24, 2017.
  12. ^ "Michael Burry life story". Business Insider. Retrieved April 23, 2019.
  13. ^ Anderson, Jenny (March 9, 2007). "Winners amid gloom of defaults". The New York Times.
  14. ^ Kakutani, Michiko (March 15, 2010). "Investors Who Foresaw the Meltdown". The New York Times.
  15. ^ a b "Michael Burry Profiled: Bloomberg Risk Takers". Bloomberg Businessweek. July 20, 2012. Archived from the original on 2012-08-04.
  16. ^ Little, Sarah (August 29, 2023). "What Happened To Michael Burry After The Big Short In Real Life". ScreenRant. Retrieved April 9, 2025.
  17. ^ a b Burry, Michael J. (April 3, 2010). "I Saw the Crisis Coming. Why Didn't the Fed?". The New York Times.
  18. ^ Little, Sarah (August 29, 2023). "What Happened To Michael Burry After The Big Short In Real Life". ScreenRant. Retrieved April 9, 2025.
  19. ^ "Author Michael Lewis on Wall Street's Delusion". 60 Minutes. March 14, 2010.
  20. ^ DiVita, Joe (March 6, 2021). "Legendary Investor Leaves Twitter, Lists 8 Metal Bands in Bio". Loudwire.
  21. ^ Stevenson, Reed (April 7, 2020). "'Criminally unjust:' 'Big Short' investor who called subprime mortgage collapse slams coronavirus lockdowns". Fortune. Retrieved 2021-05-20.
  22. ^ Brayson, Johnny (January 5, 2016). "Where 'The Big Short's Michael Burry Is Today". Bustle.com. Retrieved July 22, 2018.
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