Michael Burry, one of the first to predict the subprime crisis and bet against it, is now betting on a weak recovery by investing in gold and farmland, two hedges against inflation.One of his bets, gold, aligns his interests again with John Paulson’s, who shorted the subprime crisis by purchasing insurance on credit defaults.
Remember the last time these two agreed on an investment?
The credit crisis ensued and made them both filthy rich.
Burry wouldn’t tell Bloomberg TV if he’s buying physical gold, but he said that he agrees with John Paulson’s prediction (though his gold-only fund) that the price of gold will continue to rise.
“Paulon’s big in gold and that’s something that is interesting to me, given how I see the world playing out.”
A peek into the kind of gold Paulson’s holding might suggest what Burry’s thinking. Paulson’s gold fund has invested in gold mining, like NovaGold, among other forms of gold like the ETF Gold SPDR.
Burry disagrees with Paulson on everything else.
“I haven’t really bought into any of the other thesis.”
Namely, housing. Paulson’s bullish bet on housing doesn’t interest Burry, he says. It used to – back when he was setting up the short, he explains, but then he changed his mind as he began to predict a less robust recovery.
As for the farmland Burry is buying, he likes physical land with a water source on property, according to his interview on Bloomberg TV.
Watch it here: