Major Investor Michael Perry Warns of Looming Consumer Recession, More Earnings Trouble – Bitcoin News Economics

Michael Perry, a hedge fund manager, famous for predicting the 2008 financial crisis, warned of an impending consumer recession and more problems with earnings. He noted a decline in US personal savings and record renewable credit card debt despite trillions of dollars in stimulus money.

Michael Perry’s recession warning

Michael Perry, famed investor and founder of investment firm Scion Asset Management, warned Friday of a looming consumer recession and more problems with earnings.

He is best known for being the first investor to predict and profit from the US mortgage crisis that occurred between 2007 and 2010. He was described in “The Big Short,” a book by Michael Lewis about the mortgage crisis, which was made into a movie starring Christian Bill.

Berry explained on Twitter Friday:

US personal savings are down to 2013 levels, the savings rate to 2008 levels – while revolving credit card debt has grown at a record pace to its pre-Covid peak despite all those trillions of down cash. Looming: consumer stagnation and more trouble in profits.

His tweet includes two photos. The first shows a sharp decline in personal savings in the United States. The other shows a sharp rise in consumer credit outstanding.

At the time of writing, there are 476 comments on Burry’s tweet, which has been liked 11 thousand times and retweeted nearly 2.5 thousand times. Many people agreed with Berry on Twitter, thanking him for raising the issue and asking others to heed his warning.

One commented, “This is brutal. We dropped helicopter money on people, yet personal savings went down and credit card debts are back where they were.”

Another wrote: “Exactly what I said – inflation is not a problem. Consumer debt is a problem. Demand-side monetary policy is wrong. Price manipulation has failed to correct the market. Americans are pouring money. Switch to long-term savings instead of focusing on spending. Kill imports.”

Different user opinion:

While the media wants the narrative to be that the consumer is strong, the numbers suggest otherwise. Lower savings, increased debt and measures of inflation that are still rising compared to the previous month, with energy prices approaching highs not seen since 2008.

Many people agreed that “the numbers don’t lie,” and that the US economy looks bleak as Perry suggested or even worse.

A growing number of people have recently warned that a recession is either here or imminent, including the Tesla CEO Elon MuskRich Dad, Poor Dad Author Robert Kiyosakiand former Chairman and CEO of Goldman Sachs, Lloyd Blankfein.

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What do you think of Michael Perry’s warning? Let us know in the comments section below.

Kevin Helms

Kevin, an Austrian economics student, found Bitcoin in 2011 and has been a missionary ever since. His interests lie in Bitcoin security, open source systems, network effects, and the intersection between economics and cryptography.

photo credits: Shutterstock, Pixabay, Wikicommons

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