Michael Burry an Austrian?

Vanity Fair recently published an excerpt from Michael Lewis’ new book, “The Big Short”, detailing how hedge fund manager Michael Burry managed to clean up $100 million betting against subprime mortgages.

The article is a must-read for any investor, but what caught my eye was a book I spotted on the photo spread of Michael Burry’s office. Clearly visible in one of the stacks is “America’s Great Depression” by Murray N. Rothbard, the brilliant Austrian economist.

China’s Property Bubble is Worse than it Looks

The Chinese housing bubble is getting worse, reports the Financial Times. Sources in Shanghai and Beijing are claiming price increases on typical housing units of 50% to 100% per year. Official statistics put the rate of price increases in Beijing and Shanghai at 19.3% and 11.6% respectively.

Of course, whether the housing bubble continues depends upon the actions of the Chinese central bank. Will they allow the renmimbi to appreciate against the US dollar? It’s anyone’s guess.

The Financial Times:

The Chinese authorities are doing better than their Japanese counterparts in the 1980s. The central bank is tightening regulation of loan-to-value ratios and trying to end easy credit. But they are hesitating to take up the best policy – interest rate hikes and appreciation of the Chinese renminbi. The property bubble is a clear sign of overheating. China’s reported inflation rate does not show rampant inflation, but that was also the case in Japan in the 1980s. If the renminbi is appreciated, any overheating of China’s export sectors will be slowed, while standards of living will improve with higher purchasing power.