When they predicted the housing crash, Michael Burry and John Paulson won. Betting on gold now.

This week, "The Big Short" star Michael Burry bet $8 million on gold. The famous investor bought a gold bullion trust. John Paulson, who predicted the mid-2000s housing meltdown, bets big on gold. In music, Michael Burry isn't only a metalhead.  

The "The Big Short" investor bought 441,000 Sprott Physical Gold Trust units last quarter. Physical gold bullion makes up most of the trust's assets. This week, Burry's Scion Asset Management filed its first-quarter holdings. The gold bet was Scion's fifth-largest position with 7.4% of its $103 million US stock portfolio at $7.6 million at the end of March.  

Sprott's bullion calculator estimated the wager at $8.1 million on Friday if it stands. Burry, a value investor who found GameStop before it was a meme stock, bought gold, which is surprising.  

He's gambled against Tesla, Cathie Wood's Ark Innovation ETF, and a semiconductor ETF with Nvidia as its top holding. Burry became famous forpredicting and profiting from the mid-2000s housing bubble burst. The book and film "The Big Short." recounted the story.  

A similar wager made John Paulson famous in "The Greatest Trade Ever." The Paulson & Co. CEO seem positive on gold and other precious metals like Burry. AngloGold Ashanti, Agnico Eagle Mines, Equinox Gold, Iamgold, International Tower Hill Mines, Novagold, Perpetua Resources, Seabridge Gold, and Trilogy Metals were among Paulson's 18 positions at the end of March, an SEC filing indicated this week.  

In 2021, the seasoned investor said relentless inflation would compel the Federal Reserve to raise interest rates, driving investors to sell cash and other assets for gold. He predicted a yellow metal price spike due to rising demand and limited supply.  

The call from Paulson was prophetic. In an effort to lower inflation, the Fed has lifted its base rate from practically zero to north of 5%, and gold has risen from $1,800 per troy ounce when Paulson promoted it in 2021 to record prices above $2,400 in recent weeks.  

Burry properly foresaw inflation and rising rates and agrees with Paulson that gold will profit. Portfolio updates are simply a snapshot of an investor's holdings on a single day and may change by the time they're made public. Shorted shares, private investments, overseas holdings, bonds, and real estate are excluded. Burry's massive and unusual gold buy is significant, especially since one of the few housing crash winners is also betting big on bullion.