Burry see's another financial crises brewing

 Eminent investor Michael Burry has said that the ascent of passive investment vehicles like index funds and exchange-traded funds (ETFs) has resulted in the creation of a bubble, similar to the US subprime mortgage crises in 2008.

In an interview to a business wire, Burry said that passive investment has resulted in over-valuation of large-cap stocks which tend to receive a bulk of the investment. Any correction in these stock prices poses the risk of a crash.

'Bubble' in market parlance is the rise in asset prices, far higher than can be explained by the fundamentals.

Burry said that the passive investments had led to inflated stock and bond prices -- similar to US real estate in the years leading to 2008.

Burry was depicted in the Oscar winning movie 'The Big Short', which was based on a book by the same title.IANS