(Bloomberg) — Michael Burry’s bullish stance on GameStop Corp. in 2019 helped lay the foundations for one of the biggest retail investor frenzies in recent memory. Now the famed fund manager is warning that GameStop’s manic rally has gotten out of hand.“If I put $GME on your radar, and you did well, I’m genuinely happy for you,” Burry, best known for his prescient bet against mortgage securities before the 2008 financial crisis, said in a tweet on Tuesday. “However, what is going on now – there should be legal and regulatory repercussions. This is unnatural, insane, and dangerous.”Read more: How WallStreetBets Pushed GameStop Shares to the MoonBurry is “neither long nor short” GameStop, he said in a brief emailed response to questions from Bloomberg on Tuesday. His investment firm owned a 2.4% stake as of Sept. 30 after paring its holdings in the third quarter, according to regulatory filings compiled by Bloomberg.Burry, who became a household name after his mortgage trade was featured in “The Big Short,” helped draw attention to GameStop as early as mid-2019, when his Scion Asset Management unveiled a 3.3% stake in the beleaguered video-game retailer and urged the company to buy back shares. His position has been cited by some of the traders who’ve flooded online forums in recent weeks with posts imploring their fellow punters to buy.GameStop’s 642% surge since Jan. 12, plus another 41% gain in after-hours trading on Tuesday, has captivated Wall Street, drawn a tweet from Elon Musk and stymied short sellers including Gabe Plotkin’s Melvin Capital and Andrew Left’s Citron Research. It has also spurred calls for a Securities and Exchange Commission investigation, though experts say it’s difficult to prove chat-room posts are part of an illicit scheme to manipulate the market.(Updates with Burry comment in third paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
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