Michael Perry slams the White House for denying the risks of a recession

  • Michael Perry criticized the White House for downplaying the risks of a recession.
  • He said the Biden administration is condoning rising consumer debt and a bloated economy.
  • The investor in the fame of “The Big Short” warned of consumer spending and labor shortages.

Michael Perry, manager of “The Big Short” fame fund, has accused the Biden administration of moving the goalposts around what constitutes a recession – and denying the US economy is officially days away.

“The White House would like you to redefine a recession as a recession in which consumers do not borrow with credit cards to pay for inflation, and the workforce is insufficient for the size of the economy.” chirp Sunday.

“GDP is out Thursday, that doesn’t mean there’s anything wrong with that,” Perry added.

Perry attached a screenshot of a recent White House blog post to his tweet. The publication emphasized that the recession is not just two consecutive quarters of lower GDP; It is determined by a comprehensive analysis of real income, real spending, industrial production and employment data.

The White House continued to shrug off stagnant fears in office. He noted real income growth despite high inflation, thanks to a historically strong labor market and abundant household savings. Puri’s tweet indicates that he took this argument private.

His view seems to be that Americans are accumulating credit card debt to cover the rising cost of living, and unemployment is low because the economy has outpaced the national workforce. His tweet also indicates that he expects Thursday’s GDP data to confirm the economy is in recession, and he sees in the White House blog as an attempt to deflect the impending cash wave.

The investor and financial historian previously warned that consumers are saving less, borrowing more and on track to nearly depleting their savings by Christmas, as they deal with rising food, fuel and housing costs.

The resulting decline in consumer spending, along with retailers cutting prices to get rid of excess inventory, is expected to reduce inflation and dampen economic growth later this year.

Furthermore, Berry predicted a persistent shortage of unskilled and semi-skilled workers, which is expected to contribute to higher inflation in the long run.

His stated concerns about consumer spending and labor shortages underscore why he doesn’t buy into the Biden administration’s claim that income, spending, production and employment data are in poor health, so a recession is not on the table.

Barry shot to fame after placing a contrary bet against the mid-2000s housing bubble, which is chronicled in the book and movie “The Big Short.”

The Scion chief is also notorious for inadvertently contributing to the meme stock craze by investing in GameStop, taking short positions against Elon Musk and Cathie Wood’s main Ark fund last year, and tweeting grim warnings that rampant speculation and soaring asset prices are inevitably followed by crashes. agonizing market.

Read more: Expert Michael Berry explains what makes a “Big Short” investor special. It also revisits Burry’s iconic bet against the housing bubble, and his GameStop, Tesla and Ark bets.

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