Would you be willing to bet a billion dollars that stock prices are going to collapse?  Needless to say, only an extremely small fraction of the population has that much money.  And once you have accumulated a billion dollars, one would think that you would be extremely determined to protect it.  But that is not what Michael Burry is doing.  During the financial crisis of 2008, his massive bets against the housing market made him incredibly rich, and now he is making another “big short”.  According to CNN, Burry has bet over 1.6 billion dollars that the stock market is going to crash…

Michael Burry, the “Big Short” investor who became famous for correctly predicting the epic collapse of the housing market in 2008, has bet more than $1.6 billion on a Wall Street crash.

Burry is making his bearish bets against the S&P 500 and Nasdaq 100, according to Security Exchange Commission filings released Monday. Burry’s fund, Scion Asset Management, bought $866 million in put options (that’s the right to sell an asset at a particular price) against a fund that tracks the S&P 500 and $739 million in put options against a fund that tracks the Nasdaq 100.

Burry is using more than 90% of his portfolio to bet on a market downturn, according to the filings.

Does he know something that the rest of us don’t?

If he is wrong, he will look like a fool.

But if he is right, he will be a legend.

Without a doubt, the stock market is ripe for a crash.

Read More