A precious commodity will soon become even more valuable, says Michael Burry.
Remember Michael Burry, the man who figured out that the global mortgage market was on the verge of collapse in 2008? An entire movie was made about the role he and a few others played in the event, and it’s called “The Big Short”. Based on Adam McKay’s adaptation of Michael Lewis’s book, the film features a number of big-name actors, such as Brad Pitt and Christian Bale, and is a gripping watch for all – regardless of their interest in economic developments.
Now, Burry is making headlines for once again foretelling another financial crisis. This time, the prediction has to do with water.
In an interview with NYMag, the real-life head of Scion Asset Management answered a few questions about what average citizens can expect in the coming years. One of the most interesting predictions he shared was about how water will become even more scarce in the coming years. Rather than invest in bottled water companies (which, if we’re being honest, devastate the planet), he instead suggests investing in hydrating foods, such as fruit.
“Fundamentally, I started looking at investments in water about 15 years ago. Fresh, clean water cannot be taken for granted,” said Burry. “And it is not — water is political, and litigious.”
“Transporting water is impractical for both political and physical reasons, so buying up water rights did not make a lot of sense to me, unless I was pursuing a greater fool theory of investment — which was not my intention,” he added. “What became clear to me is that food is the way to invest in water. That is, grow food in water-rich areas and transport it for sale in water-poor areas. This is the method for redistributing water that is least contentious, and ultimately it can be profitable, which will ensure that this redistribution is sustainable. A bottle of wine takes over 400 bottles of water to produce — the water embedded in food is what I found interesting.”
In the following video, Burry also talks about investing in water, gold, land, and similar markets:
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