‘The Big Short’ investor Michael Burry says Elon Musk is selling Tesla shares to profit from soaring boom – and predicts it is the biggest bubble of his career

Michael Burry.
  • Michael Burry said Elon Musk was selling Tesla shares to profit from its boom, not to raise funds.
  • The “Big Short” investor noted that Musk had raised money and reduced his tax bill in recent months.
  • Burry revealed that he had never shorted crypto and said it was the biggest bubble of his career.

Elon Musk does not sell Tesla shares because he is short of money; he just wants to capitalize on the tantalizing valuation of the automaker, Michael Burry tweeted on Sunday.

“Let’s face it. @Elonmusk has borrowed for 88.3 million shares, sold all of his mansions, moved to Texas and asks @BernieSanders if he should sell more shares. He doesn’t need to “cash. He just wants to sell $ TSLA,” Burry said.

The celebrity investor “The Big Short” said last week that Musk had taken out personal loans against his shares; he suggested that Tesla’s CEO could sell shares to pay off those debts. Musk recently pledged to sell 10% of his Tesla shares based on the results of a Twitter poll and cashed in nearly $ 7 billion in shares last week.

Burry’s tweet pointed out that Musk had cut his tax bill by moving from California to Texas last year, most sold its real estate portfolio of $ 100 million, and Recount Senator Bernie Sanders on Sunday that he would sell more shares at the request of lawmakers. The investor’s point of view is that Musk doesn’t need cash but wants to profit from the nearly twelve-fold rise in Tesla’s share price since the start of last year.

Tesla and Scion Asset Management, which Burry heads, did not immediately respond to Insider’s requests for comment.

In a follow-up tweet Sunday, Burry pointed to Tesla’s stock chart and Musk’s tweet that the stock price was “too high” as the EV company’s valuation fell below one-fifth of its value. actual level. “Think about it a bit,” Burry said.

It should be noted both that Burry said last December that he was a seller of Tesla and that Scion was holding bearish put options on the stock no later than June 30. Investor told CNBC last month that he was no longer betting against Musk’s company, but that may have changed, especially since the 15% drop in Tesla’s share price last week was partly blamed on an insider report highlighting Burry’s theory of Musk’s stock sales.

Burry has repeatedly described Tesla as emblematic of a huge asset bubble. He called its stock price “ridiculous” in December 2020, predicted earlier this year that stocks would crash like the mid-2000s real estate market, and suggested the stock could drop to 90. % like Amazon and other high-flying tech stocks have done. when the dot-com bubble burst.

Crypto, bubbles and bonds

Burry said in a now deleted tweet on Sunday that he knew better than betting against the cryptocurrency boom, suggested assets are more overvalued today than they were during dot-com bubbles or real estate, and hinted that he was betting against a long-standing government. obligations.

“FWIW, I have never shorted cryptocurrency,” he said. “This is my third bubble, and the biggest. I’ve learned a thing or two. The 30-year treasury bills on the other hand …”

Burry jokingly asked in an October tweet how to shorten crypto, and he later told CNBC that the asset class was in a bubble – but he added that he saw value in blockchain and non-fungible tokens and had even tried crypto by buying a few tokens.

The Scion chief’s tweet suggested he could have taken a short position against 30-year Treasuries, likely because he expects spike in inflation to force the Federal Reserve to raise prices. interest rate, lowering bond prices.

Read more: Michael Burry subreddit founder explains unique investor appeal ‘The Big Short’ – and reveals actions hidden in his tweets

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