Europe is ‘retirement community for the world', says Big Short investor

Telegraph

28-04-2025

A hedge fund boss who predicted the 2008 housing crash has criticised investors for pulling money out of the US and putting it into Europe.
Kyle Bass, who was depicted in The Big Short, rote on X: 'Europe is an anti-growth, anti-capitalist, pro-tax, super-regulatory, loose collection of broken economies.'
He criticised those who were 'investing haphazardly in Europe', with billions poured into French, German and British stocks among others since Donald Trump took office on Jan 5.
Mr Bass, who made billions betting on a housing crash during the 2008 financial crisis, said Europe was 'a travel destination and a retirement community for the world. It could be great but no'.
'The Euro Stoxx 50 has annualised 1.86pc annualised returns for the past 20 years while the US S&P 500 has annualised +10pc returns over the same period. It's been +540pc better to live and invest in the United States over the past 20 years.'
To the people investing haphazardly into Europe: Have you been there lately? Europe is an anti-growth, anti-capitalist, pro-tax, super-regulatory, loose collection of broken economies. It's a travel destination and a retirement community for the world. It could be great but no. pic.twitter.com/IzB8BhCHUa
— 🇺🇸 Kyle Bass 🇹🇼 (@Jkylebass) April 28, 2025
Investors have put record sums into European stocks in the first three months of this year, seeking to shield themselves against volatility in US markets driven by the Trump administration's policies. Some $10.6bn has gone into European exchange traded funds since the start of the year.
The investments have helped boost the valuations of Europe's leading stock indices including Germany's Dax 40, France's Cac 40 and Britain's FTSE 100.
Mr Bass runs hedge fund Hayman Capital Management, which he set up in Dallas, Texas, in 2005. He rose to prominence after successfully predicting the US subprime mortgage crisis that led to the 2008 crash.
He came to be known as one of the investors who successfully 'shorted' the US housing market during the crisis, by taking out massive bets against risky loans given out to homeowners.
His multimillion-dollar bets later contributed to the collapse of investment bank Bear Stearns and he was subsequently featured in Michael Lewis's 2010 book The Big Short, later an Oscar-winning film.
While Mr Bass is sceptical of Europe, he has been betting on growth in Republican states such as Florida, Texas and Tennessee by buying up land. He hopes to capitalise on internal migrations inside the US from relatively high-tax states run by Democrats to pro-business Red states.
Mr Bass, 55, has in the past donated to both Republican and Democratic Party candidates, including California Governor Gavin Newsom and presidential hopefuls Mitt Romney and Ted Cruz.
More recently, however, Mr Bass has shown support for Donald Trump and his controversial trade policies.
Mr Bass told Bloomberg TV this month that the US needed to 'reset our trade relationships with the rest of the world', even if the country has 'to go through a brief recession in order to rebuild our foundation'.
In a separate interview with CNBC, he added: 'In a tit-for-tat trade war, we win, every time. And I mean win, as in, the pain is much greater on their side than it is on our side.'
Mr Bass has consistently criticised China, including by blaming the Chinese Communist Party for allowing the spread of Covid worldwide.
Mr Trump at one point considered making Mr Bass treasury secretary, according to Bloomberg. The hedge fund manager later publicly backed Scott Bessent, whom Mr Bass has known for years and who now holds the post.
In a post on X in November, Mr Bass said: 'Scott understands markets, economics, people and geopolitics better than anyone I've ever interacted with.'