With Burry as Adviser, a New Short-Focused Fund Takes Aim at Private Credit Risks
- Laks Ganapathi launched the short-focused hedge fund Minerva Investment Management, hiring famed investor Michael Burry as senior adviser to scan healthcare, retail, and smaller banks for short targets.
- Burry, famous for predicting the 2008 housing crash, argues AI companies mask massive financial liabilities by keeping over $1.2 trillion in non-cancellable data center leases hidden off balance sheets.
- Big Tech companies accumulated over $3 trillion in off-balance-sheet obligations, with Microsoft shifting data center leases to operating expenses to lower depreciation rates without changing actual spending.
- U.S. private credit default rates reached an all-time high of 6.3% in August, with bankruptcies at First Brands and Tricolor revealing how private credit opacity masks financial strain on borrowers.
- Ganapathi warned that current conditions differ significantly from past crises, stating, "This time around, it is not going to be like 2008. It's going to be a lot worse," if AI revenue disappoints.
16 Articles
16 Articles
Sydney Morning Herald
AI’s hidden $4.3 trillion bill could wreck world economy, warns Big Short investor
Michael Burry, the hedge-fund manager famous for his bet against the US subprime mortgage bubble that sparked the GFC, has targeted the gargantuan data centre bill he says AL companies are hiding.
Michael Burry has increased his investment intensity by switching his short positions to put options in anticipation of a decline in AI-related stocks. This is based on the judgment that the collapse of the AI bubble is imminent, and he forecasts that a turning point in the market will occur between June and September of next year.
With Burry as adviser, a new short-focused fund takes aim at private credit risks - Regional Media News
By Johann M Cherian and Jayasree Prabhu Sept 28 (Reuters) - Wall Street is busy scouring AI stocks for signs of a bubble, but a new hedge fund tied to famed short seller Michael Burry is coming to the market eyeing more consequential warnings of [...]
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