Michael Burry, Jeremy Grantham, and other top investors are predicting an epic market crash. Here are their gravest warnings so far.

Michael Burry against a promotional backdrop for the movie "The Big Short."
Michael Burry.

  • Michael Burry, Jeremy Grantham, and other experts are predicting an epic market crash.
  • Jeffrey Gundlach, Leon Cooperman, and Stanley Druckenmiller expect a downturn too.
  • Here are the gravest warnings so far from eight top investors and commentators.
  • See more stories on Insider’s business page.

Michael Burry and Jeremy Grantham are bracing for a devastating crash across financial markets. They’re far from the only experts to warn that rampant speculation fueled by government stimulus programs can’t shore up asset prices forever.

The billionaire investors Leon Cooperman, Stanley Druckenmiller, and Jeffrey Gundlach have also sounded the alarm. The same is true for the “Shark Tank” star Kevin O’Leary, the market prophet Gary Shilling, and the “Rich Dad Poor Dad” author Robert Kiyosaki.

Here are the most striking warnings from these 8 market experts:

Michael Burry

Michael Burry against a gray promotional backdrop for the movie "The Big Short."
Michael Burry.

Burry in June described the markets as the “greatest speculative bubble of all time in all things” and said retail investors were buying into the hype around meme stocks and cryptocurrencies before the “mother of all crashes.”

Earlier this year, the investor of “The Big Short” fame, who runs Scion Asset Management, pointed to Tesla, GameStop, bitcoin, dogecoin, Robinhood, and the red-hot US housing market as signs of speculative excess.

Read more: Goldman Sachs says buy these 20 stocks that have the most upside potential right now — including 5 set to surge by at least 50%

Jeremy Grantham

Jeremy Grantham against a blurry background.
Jeremy Grantham.

Grantham in January said the market was a “fully fledged epic bubble” and described it as the “real McCoy.”

“When you have reached this level of obvious super-enthusiasm, the bubble has always, without exception, broken in the next few months, not a few years,” the legendary investor and GMO cofounder said.

“We will have to live, potentially, possibly, with the biggest loss of perceived value from assets that we have ever seen,” Grantham added.

Leon Cooperman

Leon Cooperman holding his glasses up to his right temple.
Leon Cooperman.

Cooperman expressed deep concerns about financial markets in May.

“Everything I look at would suggest caution, intermediate to long term, would be the rule of the day,” the billionaire investor and Omega Advisors boss said. “When this market has a reason to go down, it’s going to go down so fast your head’s going to spin.”

But Cooperman described himself as a “fully invested bear” because factors that typically cause bear markets — rising inflation, recession fears, a hostile Federal Reserve — weren’t present.

Read more: How to mine doge: An 18-year-old TikTok influencer shares his process for earning crypto without directly buying via a $700 rig — and explains how it works for other altcoins including litecoin

Stanley Druckenmiller

Stanley Druckenmiller speaking and gesturing against a black-and-orange background.
Stanley Druckenmiller.

Druckenmiller said in May that the bull market reminded him of the dot-com boom, but he cautioned that asset prices could continue rising for a while.

“I have no doubt that we are in a raging mania in all assets,” the billionaire investor and Duquesne Family Office chief said. “I also have no doubt that I don’t have a clue when that’s going to end.

“I knew we were in a raging mania in ’99, but it kept going on, and if you had shorted the tech stocks in mid-’99, you were out of business by the end of the year,” Druckenmiller added.

The investor indicated he would pull his cash out of equities in a matter of months.

“I will be surprised if we’re not out of the stock market by the end of the year, just because the bubbles can’t last that long,” he said.

Jeffrey Gundlach

Jeff Gundlach speaking against a black background.
Jeffrey Gundlach.

Equities are undeniably expensive, Gundlach said in March.

The billionaire investor and DoubleLine Capital boss said that claiming the stock market was “anything other than very overvalued versus history” was “just to be ignorant of all the metrics of valuation.” He predicted that stocks would fall by upwards of 15% when the downturn comes.

Gundlach, known as the “bond king,” predicted that the retail investors who had piled into meme stocks and other speculative assets wouldn’t stick around once prices started dropping.

“We’ll have a tremendous unwind of a lot of the money that thinks that the stock market is a one-way thing,” he said.

Read more: Famed investor Michael Burry is predicting the ‘mother of all crashes’. Here’s what 9 other key ‘Big Short’ players are doing now.

Kevin O’Leary

Kevin O'Leary speaking and pointing on "Shark Tank."
Kevin O’Leary.

O’Leary said in April that stocks would eventually crumble, but he framed the downturn as an educational opportunity for rookie investors.

“Buying the dip is more rock-and-roll, but what invariably happens is you go through a massive correction and you learn a very important lesson,” the “Shark Tank” star and O’Leary Funds chief said.

“The generation that is trading right now has never gone through a sustained correction. It’s coming — I don’t know when, I don’t know what’ll trigger it, but they will learn their lesson,” he continued.

“If you have a lot of leverage on, it’s a hell of a lesson because you end up in a negative net-worth position,” O’Leary added. “But you do learn from it.”

Robert Kiyosaki

Robert Kiyosaki against a green background.
Robert Kiyosaki.

Kiyosaki tweeted in June that he was expecting the greatest market crash ever.

“Biggest bubble in world history getting bigger,” the personal-finance guru and author of “Rich Dad Poor Dad” said. “Biggest crash in world history coming.”

Kiyosaki has accused the Federal Reserve of overstimulating markets and devaluing the dollar. He’s advised investors to prepare for the downturn by stocking up on precious metals and cryptocurrencies.

“ARE YOU READY?” he tweeted in April. “Boom, Bust, Mania, Crash, Depression. Mania in markets today. Prepare for biggest crash, depression in world history. What will Fed do? Print more money? Save more gold, silver, bitcoin.”

Gary Shilling

Gary Shilling against a yellow-and-orange background.
Gary Shilling.

Shilling predicted in April that financial markets would nosedive, but he declined to hazard a guess at when the crash would arrive.

“I’m not making any firm prediction as to when this thing is going to collapse,” the veteran forecaster and president of A. Gary Shilling & Co. said.

“Speculations outrun any logic and that’s probably going to be true of this one,” Shilling continued. “But at some point, boy, there’s going to be a lot of blood on the floor.”

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Stanley Druckenmiller and Dan Loeb’s Third Point back $70 million funding round for crypto asset manager Bitwise

Druckenmiller, Stan Druckenmiller
  • Stanley Druckenmiller and Dan Loeb’s Third Point participated in a $70 million Series B fundraising round for Bitwise Asset Management.
  • Bitwise manages the world’s largest crypto index fund along with a host of other crypto fund products.
  • The round was led by prominent tech investor Elad Gil and Electric Capital and values the company at over $500 million.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Stanley Druckenmiller and Dan Loeb’s Third Point participated in a $70 million Series B fundraising round for Bitwise Asset Management, the company announced on Tuesday.

The round was led by prominent tech investor Elad Gil and crypto venture fund Electric Capital and values the company at over $500 million. Prominent investors including Druckenmiller, Third Point, Bridgewater CEO David McCormick, KKR founder Henry Kravis, and others joined the round.

Bitwise manages the world’s largest crypto index fund, the Bitwise 10 Crypto Index Fund, along with a host of other crypto fund products. As of the first quarter of 2021, Bitwise managed over $1.2 billion.

The San Francisco-based company plans to use the funding to strengthen its balance sheet and accelerate the national buildout of its organization, team and product suite. Bitwise CEO Hunter Horsley said the new capital will cement the company’s “position as the premier crypto partner for professional investors.”

“We’re thrilled to be backing Bitwise,” said Loeb, Third Point’s CEO and CIO. “Bitwise has assembled a best-in-class team, has built professional-grade products, and is doing all the right things to build an enduring institution in the crypto economy.”

The news of Loeb’s participation comes a week after The Information reported that his hedge fund is co-leading a new financing round in BlockFi, a wealth management and trading firm for cryptocurrency holders.

Third Point, which manages about $17 billion, disclosed in a regulatory filing in late March that five of its funds hold crypto assets under custody with Coinbase. The amount and duration of investment is currently unclear.

Meanwhile, Stanley Druckenmiller has disclosed that he owns “some” bitcoin, and has also said that owning bitcoin could be a good hedge against inflationary pressure.

Existing Bitwise backers including Highland Capital, Khosla Ventures, Blockchain Capital, Castle Island Ventures, Alison Davis, Adam Nash, and Naval Ravikant participated in Series B round as well.

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Legendary investor Stanley Druckenmiller said dogecoin is a ‘manifestation of the craziest monetary policy in history’ in a recent interview. Here are 8 of his best quotes.

GettyImages 452232722
Stanley Druckenmiller, Founder, Duquesne Capital Management in New York, 2014.

  • Stanley Druckenmiller told The Hustle in a recent interview that dogecoin is the “craziest monetary policy in history.”
  • The billionaire investor also shared his thoughts on bitcoin, ether, and the biggest risk to the stock market right now.
  • He also predicted which FAAMG company will first hit a market capitalization of $5 trillion.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Among the many things billionaire investor Stanley Druckenmiller believes in, dogecoin isn’t one of them.

In a recent interview with The Hustle, the investor said he does not keep tabs with the developments surrounding the meme cryptocurrency, which started as a joke in 2013.

“I just try and pretend doge doesn’t exist,” he told The Hustle. “I think so little of it, it doesn’t even bother me when it goes up.”

Dogecoin has risen at a blistering pace so far this year, soaring more than 7,200%. The massive gains were due in large part to prominent figures like Elon Musk and Mark Cuban continuously backing the token.

Druckenmiller, the head of Duquesne Capital Management, also shared some of his thoughts on bitcoin, ether, and the recent tech sell-off.

Here are his 8 best quotes from the interview, lightly edited and condensed for clarity:

On dogecoin:

“[Dogecoin] is just like NFTs. It’s a manifestation of the craziest monetary policy in history. And I think since there’s no limit on supply, I don’t really see the utility of [dogecoin] right now. It’s just this wave of money in the Greater Fool Theory.”

On bitcoin:

“I took my costs and then some out of it and I still own some of it. My heart’s never been in it. I’m a 68-year old dinosaur, but once it started moving and these institutions started upping it, I could see the old elephant trying to get through the keyhole and they can’t fit through in time.”

On ether:

I’m a little more skeptical of whether it can hold its position. It reminds me a little of MySpace before Facebook. Or maybe a better analogy is Yahoo before Google came along. Google wasn’t that much faster than Yahoo, but it didn’t need to be. All it needed to be was a little bit faster and the rest is history.”

On the recent tech sell-off:

“Think of the tech stocks like a company selling railway ties and building the guts of the internet. When you’re building the railroad, your sales are going up +50, +60, or +70% a year. But once the railroad is built [you don’t need the railway ties anymore]. Your growth not only doesn’t go up 70%, it goes down because on a rate of change basis, you don’t need any more railroad ties.”

On the FAAMG company that would hit $5 trillion:

“If you put a gun to my head or we’re going to Vegas: Number 1 would be Amazon, number 2 would be Microsoft … I’ve never really believed Apple had the innovation to take you to the next level and it is mainly a hardware company … Google could have a big pop, ironically, if the government breaks them up because their core search business is literally the best business I’ve ever seen.”

On the market’s biggest risk:

Without a doubt: inflation strong enough that the Fed responds to it. No doubt about it. This bubble has gone long enough and it’s extended enough that the minute they start tightening, the equity market should go down a lot.”

On the effect of the recent Wall Street Bets craze:

“They’ll probably migrate away from some of the more radioactive names like GameStop. But I think it’ll actually end up being some core healthy information moving through the sharing network.”

On concentrating one’s bets:

When I’ve looked at all the investors (that) have very large reputations – Warren Buffett, Carl Icahn, George Soros – they all only have one thing in common. And it’s the exact opposite of what they teach in a business school. It is to make large concentrated bets where they have a lot of conviction.”

Read more: Glauber Contessoto became a ‘dogecoin millionaire’ this year. He explains why the recent drop does not shake his bullishness in the joke token – and shared his advice for new buyers.

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Billionaire investor Stanley Druckenmiller blasted the Fed, touted bitcoin over ethereum, and issued a dire warning about the dollar in a recent interview. Here are the 10 best quotes.

Stanley Druckenmiller
Stanley Druckenmiller.

  • Stanley Druckenmiller blasted the Federal Reserve for boosting asset prices and the national debt.
  • He warned the dollar could cease to be the global reserve currency within 15 years.
  • The investor is more bullish on bitcoin than Ethereum’s ether, and expects to sell his stocks.
  • See more stories on Insider’s business page.

Stanley Druckenmiller warned the Federal Reserve’s stimulus efforts are inflating a massive asset bubble, and endangering the dollar’s status as the world’s reserve currency, in a CNBC interview this week.

The billionaire investor and boss of Duquesne Family Office also expects to cash out his stocks in the next few months, suggested a cryptocurrency-based ledger system could usurp the dollar on the global stage, and predicted bitcoin will have more staying power than the Ethereum network’s ether token.

Here are Druckenmiller’s 10 best quotes from the interview, lightly edited and condensed for clarity:

1. “A monkey could make money in this market.” – commenting on how a wide range of assets have surged over the past year as the Federal Reserve has pumped liquidity into financial markets.

2. “I have no doubt that we are in a raging mania in all assets. I also have no doubt that I don’t have a clue when that’s gonna end. I knew we were in a raging mania in ’99, but it kept going on, and if you had shorted the tech stocks in mid ’99, you were out of business by the end of the year.”

3. “I can’t find any period in history where monetary and fiscal policy were this out of step with the economic circumstances. We’re still acting like we’re in a black hole, when in fact the economy’s accelerating.”

4. “I will be surprised if we’re not out of the stock market by the end of the year, just because the bubbles can’t last that long. I really have an open mind and right now, treacherously, we’re still playing the game to some extent.”

5. “I’m worried for the first time that within 15 years we lose reserve currency status and all the unbelievable benefits that accrued from it.” – warning that aggressive monetary and fiscal policy will make the national debt balloon, damaging the dollar’s prospects.

6. “I really don’t understand why 1.6% inflation with a mandate of price stability is a national tragedy. If the Fed wanna do all this and risk our reserve currency status, risk an asset bubble blowing up, so be it. But I think we oughta at least have a conversation about it.”

7. “The elephant in the room is inflation. It may become so obvious that the Fed has to move, and the longer they wait to move, the bigger the bubble will be and the bigger the reaction.”

8. “Five or six years ago, I said that crypto was a solution in search of a problem. That’s why I didn’t play the first wave of crypto – we already have the dollar, so what do we need crypto for? Well, the problem has clearly been identified, it’s Jerome Powell and the rest of the world’s central bankers.”

9. “The most likely replacement for the dollar would be some kind of crypto-derived ledger system invented by some kids from MIT or Stanford or some other engineering school that doesn’t exist yet.”

10. “It’s going to be very hard to unseat bitcoin as a store of value, because it’s got a 14-year brand, and there’s a finite supply. Ethereum has the lead in terms of smart contracts, in terms of commerce. But Facebook was not the first social network, it was number 11, and Yahoo may have invented the search engine, but we all know what happened with Google versus Yahoo. It’s just not probable in my mind that Ethereum is gonna be the ultimate winner.”

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Billionaire investor Stanley Druckenmiller says he owns bitcoin as a ‘sort of a plaything’ – and millennials look at it the way he views gold

Druckenmiller, Stan Druckenmiller
  • Stanley Druckenmiller said he owns bitcoin as a “sort of a plaything” but he isn’t sure if he believes in it.
  • “It could be a new asset class. The answer is I don’t know,” he said in a Goldman Sachs webcast.
  • Druckenmiller said younger millennials look at bitcoin the way he used to look at gold.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

US billionaire Stanley Druckenmiller says he owns some bitcoin, and it may well be a new asset class.

“I do own some of it,” he said in a recent episode of Talks with Goldman Sachs. “It’s gone up a lot since I bought it. It’s just sort of a plaything. I don’t really believe in it. I don’t really not believe in it. It could be a new asset class. The answer is – I don’t know.”

Bitcoin rose 13% to a record high on Monday after Tesla disclosed that it spent $1.5 billion to buy the popular cryptocurrency. The token was last trading around $43,725.51, smashing its previous all-time high near $41,000 set in January.

Tesla’s purchase is expected to create a ripple effect across corporations around the globe and add momentum to its shares as more investors start to factor in its crypto exposure as part of its overall valuation, according to analysts at Wedbush.

Read More: RBC says to buy these 15 stocks as small companies keep dominating the market – and details why each is a top pick for 2021

Druckenmiller, chairman of the Duquesne Family Office, said he didn’t think bitcoin would be trading as high as it is if the central bank weren’t pumping record amounts of money into the economy to stop it collapsing. 

Although he was skeptical of it at first, he said bitcoin advocates have done an “unbelievable marketing job.”

“It’s been around 13 years,” he said. “And particularly, younger millennials look at it the way I’ve always looked at gold.”

Druckenmiller said he does doubt whether bitcoin can act as anything other than a store of value. He cited volatility, an immense amount of energy used in its generation, and other complex technical problems as shortcomings.

However, he has previously said that owning bitcoin is a good hedge against inflationary pressure.

Read More: Wall Street’s resident IPO expert shares the strategy behind her ETF that returned 107% last year – plus 3 risks to the current IPO boom and 5 offerings to watch this year

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