# Big Short 2.0: Michael Burry *FLIPS* | Closes Fund!

Source: https://www.youtube.com/watch?v=TTVfkt6osCo
Recap page: https://rapidrecap.app/video/TTVfkt6osCo
Generated: 2025-11-13T14:35:10.079+00:00

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## Quick Overview

Michael Burry is closing his Scion Asset Management fund by year-end 2025 to return capital to investors, stating his estimation of securities' value is out of sync with the markets, a move that echoes his 2008 exit from his fund before the housing crisis, though the video presenter argues Burry's short bets against Palantir and Nvidia were incorrectly timed, leading to him being wrong on the short-term outcome despite his long-term thesis on accounting fraud potentially being correct.

**Key Points:**
- Michael Burry announced he will liquidate Scion Asset Management and return capital to investors by the end of 2025 with a small tax holdback.
- Burry cited that his estimation of securities' value is 'not now, and has not been for some time, in sync with the markets,' suggesting disillusionment.
- The presenter critiques Burry's timing on recent short positions, noting his $912 million short bet against Palantir (PLTR) was placed too late, leading to losses when the stock rose briefly.
- The presenter contrasts Burry's track record, showing he was wrong on several major calls (like the 2021/2022 market top and the 2021 meme stock squeezes) while being correct on others, such as the 2008 subprime bubble and the 2020 housing bubble.
- The video suggests that Group 3 investors, who believe in accounting fraud (like the depreciation curve of chip sales), will ultimately benefit if Burry's long-term bearish thesis on tech/AI proves correct, even if his short timing was flawed.
- Burry's current frustration stems from clients demanding money back while the market focuses on daily gains, which he views as unsustainable euphoria driven by marketing, contrasting with his long-term structural concerns.

![Screenshot at 00:04: The letter from Scion Asset Management, LLC dated October 27, 2025, announcing the liquidation of funds and return of capital to investors by year's end.](https://ss.rapidrecap.app/screens/TTVfkt6osCo/00-00-04.png)

**Context:** The video analyzes the public announcement by Michael Burry, famous for predicting the 2008 financial crisis, that he is liquidating his investment fund, Scion Asset Management, by the end of 2025. The analysis focuses on the implications of this closure, contextualizing it against his history of accurate and inaccurate market predictions, particularly his recent public short positions against companies like Palantir and Nvidia.

## Detailed Analysis

The video centers on Michael Burry's decision to liquidate Scion Asset Management by the end of 2025, returning capital to investors due to his view that market valuations are out of sync with reality. The presenter critiques Burry's recent short timing, specifically citing his $912 million short on Palantir, which was initiated late, causing him to lose money when the stock briefly rose before falling. The presenter reviews Burry's historical predictions from a detailed spreadsheet, highlighting instances where Burry was both wrong (e.g., calling the peak in 2021, Bitcoin speculation) and right (e.g., 2008 crisis, 2020 housing bubble). The presenter categorizes investor reactions into three groups: those who think the stocks will 'moon' (Group 1), those who think they will 'moon now, crash later' (Group 2), and those who believe there is fundamental 'fraud' involving accounting issues and inflated expenses (Group 3). The presenter argues that while Burry was wrong on his short timing for stocks like Palantir and Nvidia, his underlying thesis about accounting fraud, high expenses, and unsustainable growth rates might still be proven correct over the long term, suggesting the current market euphoria (like heavy advertising spending by AI firms) is masking underlying structural issues.

### Burry's Fund Liquidation

- Announcing liquidation by year-end 2025
- Returning capital to investors
- Citing market valuations being out of sync

### Critique of Short Timing

- $912M short on PLTR was poorly timed, losing money on initial rise
- Short on NVDA also performed poorly in the short term
- Shorting stocks for 2-3 years is difficult in a market obsessed with daily performance

### Historical Prediction Accuracy

- 2009 bubble call was wrong (S&P rallied)
- 2020 COVID put options were correct (S&P fell 34%)
- 2021 Tesla/Housing bubble call was wrong (TSLA surged 743%)

### Investor Group Perspectives

- Group 1 believes stocks will 'moon' (AI/chip narrative)
- Group 2 believes 'Moon now, crash later'
- Group 3 believes in 'Fraud' (accounting fraud, high expenses, depreciation curve issues)

### Current Market Environment

- OpenAI CFO reports softening engagement
- AI companies running aggressive ads on X/Facebook
- Market is obsessed with daily gains, ignoring long-term structural issues

![Screenshot at 00:04: The letter from Scion Asset Management, LLC dated October 27, 2025, announcing the liquidation of funds and return of capital to investors by year's end.](https://ss.rapidrecap.app/screens/TTVfkt6osCo/00-00-04.png)
![Screenshot at 00:20: Stock chart showing the recent decline in an asset, illustrating the short positions discussed.](https://ss.rapidrecap.app/screens/TTVfkt6osCo/00-00-20.png)
![Screenshot at 00:56: A zoomed-in view of the analyst's spreadsheet summarizing Michael Burry's past predictions and their actual outcomes, highlighting hits and misses.](https://ss.rapidrecap.app/screens/TTVfkt6osCo/00-00-56.png)
![Screenshot at 03:28: CNBC graphic detailing Michael Burry's $912M short bet against Palantir using put options as of September 30th.](https://ss.rapidrecap.app/screens/TTVfkt6osCo/00-03-28.png)
![Screenshot at 04:10: A handwritten list categorizing investor reactions into Group 1 \(MOON\), Group 2 \(Moon now, crash later\), and Group 3 \(FRAUD/accounting fraud\).](https://ss.rapidrecap.app/screens/TTVfkt6osCo/00-04-10.png)
![Screenshot at 08:16: Screenshot of the 'Sources' article highlighting that OpenAI's CFO told investors engagement has softened, despite strong topline figures.](https://ss.rapidrecap.app/screens/TTVfkt6osCo/00-08-16.png)
![Screenshot at 10:21: The spreadsheet showing Burry's predictions, including the 2009 index fund bubble call \(Wrong\) and the 2020 COVID put options call \(Correct\).](https://ss.rapidrecap.app/screens/TTVfkt6osCo/00-10-21.png)
![Screenshot at 13:37: A tweet from Cassandra Unchained showing Michael Burry's 'Me then, me now. Oh well. It worked out. It will work out' meme, suggesting acceptance of short-term misses.](https://ss.rapidrecap.app/screens/TTVfkt6osCo/00-13-37.png)