bro was right ONCE and now every tweet is a headline
It was a hell of a once tho
So, a lottery winner.
Michael Burry says neither SpaceX nor Anthropic is worth $1T
131–140 of 166 posts
Re: Michael Burry says neither SpaceX nor Anthropic is worth $1T
#132Coinbase IPOed 5 years ago and is (and has mostly been) trading below its IPO price. Perhaps private equity has become so skilled that when they finally sell to the public they leave nothing on table.
Or maybe it's very rational because their 2021 (IPO year) revenue ($7,839m) was higher than their 2025 revenue ($7,181).
Granted, their profitability is better but in 2021 they were (rationally) valued based on Great Expectations which didn't pan out.
Now they're (rationally) valued on Much Less Great Expectations.
So I think it has nothing to do with skills of early investors (not the boogeymen, irrelevant private equity) and everything to do with Coinbase being a fast growth company at the time of IPO and being negative growth company after IPO.
Re: Michael Burry says neither SpaceX nor Anthropic is worth $1T
#133[deleted]
Re: Michael Burry says neither SpaceX nor Anthropic is worth $1T
#134Earlier quoted context omitted.
Can you elaborate on how passive investing contributes to this?
Simple. Most "passive investors" are ETFs and pension funds that sometimes by law, sometimes by statute/sales prospect are limited to being low-risk, i.e. the monthly contributions go towards "safe" asset classes, and in addition retail customers prefer low-fee (and thus low-management) funds. That in turn means that a lot of the invested money goes towards ultra-safe stuff like government bonds, which is about the o…
Isn't a counter argument that there are index funds for just about everything? Ie, I'm sure there will be an index for "Everything in S&P Except SpaceX" for those who think SpaceX doesn't belong there. There are even "anti-index index funds" that are defined by being the opposite of another ETF.
Re: Michael Burry says neither SpaceX nor Anthropic is worth $1T
#135Earlier quoted context omitted.
> People have seen others make insane, life changing money at this slot machine and are wanting to take their chances. Isn’t this the exact same sentiment from the late 1920s when people were making “insane, life changing” money by buying equities on margin?
This time is different. It may well though, because now we have an automatic buy from the government to 'fix' the market if it 'breaks'. The line goes up.
Given the current sentiment as well as the past response for "too big to fail", I can definitely see why one might think this time is different.
Re: Michael Burry says neither SpaceX nor Anthropic is worth $1T
#136Earlier quoted context omitted.
This time is different. It may well though, because now we have an automatic buy from the government to 'fix' the market if it 'breaks'. The line goes up.
That just means it's like the 1920s even harder, just on a time delay fuse
People really think we have found a way to negate the laws of physics. As of there can exist a system without entropy.
Humans are prisoners of the present moment, but just think what a market is. What does it really mean as it accumulates disorder for decade plus.
Can the market just continue to deviate from a markets actual purpose forever? Hell, can anything in this universe exist in a particular state forever.
If it can’t, then it means at some point things have to go in the other direction. Use your imagination what that means for the largest most complex (man made) system in the history of this planet.
Re: Michael Burry says neither SpaceX nor Anthropic is worth $1T
#137Earlier quoted context omitted.
The strategy should be to put money into AI broadly and not necessarily tie to a certain company -- something pension companies already know. So evidence that internet was a bubble is wrong, it in fact shows that pensions did the right thing by putting money in the internet.
Do I need to dig out newspaper articles from around 2003 - 2008?
How do you suppose those would prove your point?
Re: Michael Burry says neither SpaceX nor Anthropic is worth $1T
#138The stock market doesn't operate on long-term principles anymore. So, in some sense, it is immaterial that the rosy scenarios where AI is responsible for >$30 trillion in the next decade are unlikely. If you bet against the hype and it goes on for a few more months/years you lose as much or more than if you went along for the ride. Burry is well aware of this, he has written about how passive investing is contributin…
The extent to which you’re exposed to long term principles is directly related to the time you’re in the market. Ie trader vs investor “In the short run, the market is a voting machine, but in the long run, it is a weighing machine” - benjamin graham
Graham died back when stocks were traded by guys shouting orders from a pit. High frequency trading was decades away, as was Wall Street's push for:
- creative accounting (Enron, Worldcom)
- zero-interest rate policy
- SPAC IPOs
- exotic securitization (credit default swaps)
...that made valuation more opaque over time. The age of value investing is long gone.
Re: Michael Burry says neither SpaceX nor Anthropic is worth $1T
#139Earlier quoted context omitted.
Passive investing funnels money into the market without accounting for business fundamentals. It simply allocates funding by looking at sector and market cap. It's the definition of dumb money. As long as companies can make it into the index, passive investors will funnel money into buying stock of these companies, no matter how badly these companies are run.
Doesn't that passive process reverse at some point? The trillions that mechanically and automatically flowed into index funds in pensions and 401k accounts must mechanically and automatically flow right back out after retirement, right? Especially when younger generations are too poor to save for retirement and most companies don't offer pensions to younger workers any more, where will the inflows come from to offset…
As long as the money supply keeps increasing, excess money has few places to go (bank deposits, stocks, real estate, and physical goods). Most of it will go into the stock market, since it's quite liquid with and has good investment returns.
Also, a significant part of the stock market is driven by foreign investment. The US has few capital controls and is an easy market for foreigners to invest in. Around 1/3rd of US stocks are owned by foreigners.
Even if the older generation sells during retirement, foreign investment will be more than enough to replace it.
Re: Michael Burry says neither SpaceX nor Anthropic is worth $1T
#140Earlier quoted context omitted.
Unless the investment was into worthless paper from those companies, tied to pension funds and similar.
The strategy should be to put money into AI broadly and not necessarily tie to a certain company -- something pension companies already know. So evidence that internet was a bubble is wrong, it in fact shows that pensions did the right thing by putting money in the internet.
Since you couldn't "put money in the internet", you had to choose some actual companies. Your results varied by which company you chose, and when you invested. (This is always the case, obviously) Sun Microsystems? Let's say you bought the dip at the end of May 2000, at $150. It's ending price when it was bought by Oracle in 2010 was $9.50. [1] Suppose you bought Cisco at the same time for $37.30. You would have waited 18 years, until Aug 2018 for it to reach the same height. Now it's at $127, which over 26 years is an annualized return of 5%. It would have only taken 14 years to break even with Microsoft.
Now, if you had put your money in those stocks 12 months later, you would do okay (except for Sun). So, no, those pensions did not do the right thing by buying at the peak of a bubble. At least, not for people like me who don't like 15 years of negative returns.
[1] https://companiesmarketcap.com/sun-microsystems/stock-price-...
[2] https://companiesmarketcap.com/cisco/stock-price-history/