Michael Burry says the US economy will suffer a multiyear recession. He sees no way for authorities to end the downturn early and warns consumers will virtually exhaust their savings soon, tanking the economy.

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via businessinsider:

  • Michael Burry has predicted the US economy will suffer a multiyear recession.

  • The ‘Big Short’ investor sees no way for authorities to end the downturn early.

  • Burry has warned consumers will virtually exhaust their savings soon, tanking the economy.

Michael Burry has sounded the recession alarm, warning the US economic downturn will probably last several years as he sees no way to end it early.

“What strategy will pull us out of this real recession?” he said in a now-deleted tweet on Tuesday. “What forces could pull us so? There are none. So we are really looking at an extended multi-year recession.”

The investor of “The Big Short” fame seems to be suggesting the Federal Reserve and US government have few good options to shore up growth. He has previously accused policymakers of fueling inflation by flooding the economy with money during the pandemic, and warned that could make it tougher and more expensive to stimulate growth in the future, especially if doing so would fuel price increases.

Burry has been predicting a recession for a while. In June, he noted Americans — faced with surging prices and higher interest rates — are saving less, borrowing more, and poised to virtually exhaust their savings by Christmas. Those trends threaten to hammer consumer spending, erode corporate profits, and spark an economic downturn, he said.

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