In a dramatic move revealed by recent SEC filings, Burry's Scion Asset Management has slashed its portfolio to just seven positions. 

Six of them are aggressive short bets: bearish put options against some of the biggest names in tech and Chinese equities, including Nvidia, Alibaba, and Baidu.

Only one company appears to have managed to retain Burry's faith: Estee Lauder, where Burry has doubled down, boosting his holdings to 200,000 shares valued at $13.2 million.

While cosmetics may be an unusual choice ahead of a potential financial meltdown,  it's not without logic.

In times of economic distress, consumers often indulge in small luxuries even as they forego big-ticket items - a phenomenon known as the 'lipstick index.' 

When wallets tighten, lipsticks replace dresses and handbags for that touch of retail therapy.

Burry's bearish position coincides with uncertainty on Wall Street over Donald Trump's trade war and the Big Beautiful Bill - a spending package expected to saddle the US with at least another $4 trillion in debt over the next 10 years.

The national debt already stands at $36 trillion and the cost of servicing the payments currently dwarf defense spending as a proportion of America's GDP.

This is rattling investors, not least Burry and JPMorgan boss Jamie Dimon who said last week that government 'mismanagement' has the potential to 'kill us.'

Dimon told the Reagan National Economic Forum on Friday that a 'crack' was going to appear in the bond market.

A 'crack' in the bond market occurs when investors lose confidence in the government's ability to service its debt. Bonds are sold, yields go higher and the cost of borrowing increases for all Americans, including the government itself. 

'I'm telling you it's going to happen, and you're going to panic. I'm not going to panic. We'll be fine. We'll probably make more money,' he said.