Famed bear Michael Burry says he’s bullish on Fannie and Freddie

Michael Burry, the money manager made famous in The Big Short, says he holds sizable positions in both Fannie Mae and Freddie Mac common stock and believes a re-listing of the US housing-finance giants is “nearly upon us.”

In a 6,000-word blog post Monday, Burry outlined why he’s now bullish on the government-sponsored enterprises, the political and regulatory hurdles that still stand in the way of a public offering, and the steps he says Washington must take before the pair can stage a comeback on Wall Street.

Burry earned renown for predicting the collapse of the US housing market before the 2008 financial crisis. In the post, he shared excerpts from an old note in which he dubbed the company “Frauddie Mac,” and said that he had bought the company’s five-year credit-default swaps in the years leading up to its meltdown, which led to government conservatorship. While some investors have famously held Fannie and Freddie positions for over a decade, Burry said he became bullish on the shares only after President Donald Trump’s election last year.

“I personally own both Fannie Mae and Freddie Mac common stock in good size,” Burry wrote in the post, in which he examined the current political dynamics and how shares may be valued in a sale and beyond. The offering price “is a key determinant of the intrinsic value of these companies, and I will certainly revisit this thesis as those numbers come into focus.”