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<ul><li>The investor <keyword id="418743" type="PERSON" weightage="60" keywordseo="Michael-Burry">Michael Burry</keyword> is cautioning against getting too infatuated with specific <keyword id="6354298" type="DEFINITION" weightage="60" keywordseo="Stocks">stocks</keyword>.</li><li>On Thursday he pointed to <keyword id="266280" type="COMPANY" weightage="60" keywordseo="iOmega">Iomega</keyword>, a disk-drive maker that saw a spectacular rise and fall.</li><li>Burry probably sees parallels between Iomega's '90s cult following and the hype around <keyword id="363661" type="COMPANY" weightage="60" keywordseo="GameStop">GameStop</keyword>. </li></ul>Michael Burry, whose billion-dollar bet against the US housing bubble was immortalized in Michael Lewis' book "<keyword id="143512" type="COMPANY" weightage="60" keywordseo="The-Big-Short">The Big Short</keyword>," issued a fresh warning Thursday to people feverishly speculating on stocks."How many current $stonck market fans lived #Iomega?" the <keyword id="9272335" type="UNKNOWN" weightage="60" keywordseo="scion-asset-management">Scion Asset Management</keyword> boss asked in a now-deleted tweet. "Some of us older folk have a few 'been there, done that' badges that are fairly relevant about now."Read more: <a href="https://www.businessinsider.com/warren-buffett-berkshire-hathaway-7-key-insights-adam-mead-2021-1" target="_blank" rel="noopener noreferrer">Value investor Adam Mead shares 7 key insights into Warren Buffett's Berkshire Hathaway after writing its complete financial history</a>The investor linked to a <a href="https://mindsetvalue.substack.com/p/iomegans-identity-and-investing">cautionary tale on Substack</a> about Iomega, a disk-drive maker that once inspired the kind of mania now affecting stocks such as GameStop, AMC, and BlackBerry.Burry's firm disclosed a stake in GameStop and called for changes at the video game retailer in 2019, arguably laying the groundwork for the stock to explode as much as 2,500% this month.Iomega's stock skyrocketed 2,135% in a single year, lifting its market capitalization to almost $7 billion, the investor Aaron Edelheit wrote in his Substack newsletter.The business attracted cult followers who labeled themselves "Iomegans," trashed any critics of their beloved company, and embraced the stock as their investing identity.Read more: <a href="https://www.businessinsider.com/stock-picks-to-buy-expected-outperform-earnings-2022-morgan-stanley-2021-1">MORGAN STANLEY: Buy these 17 stocks with strong earnings that are expected to outperform into 2022 even if the broader market sinks</a>Iomega shares plummeted in 1996, however, and the company was eventually sold for $218 million to EMC in 2008."Iomega was an early preview of how ridiculous investors would become in the Internet bubble," Edelheit wrote.The episode demonstrates how stock lovers can "lose sight of the fundamentals and simply become a cheerleader," dismissing naysayers and never challenging their own viewpoint, he continued."How rigid you are in your investing identity matters," Edelheit added. "This holds as much danger for investors now as it did for Iomegans."Read more: <a href="https://www.businessinsider.com/stock-market-short-squeeze-reddit-day-trading-advice-ally-invest-2021-1">A chief investment strategist breaks down how the GameStop saga could upend long-standing practices on Wall Street - and shares her 4-part advice for navigating the frenzied trading environment</a>Burry probably flagged the story because of the parallels between the intense passion and blind faith in certain stocks on online forums such as <keyword id="10658052" type="UNKNOWN" weightage="60" keywordseo="wall-street-bets">Wall Street Bets</keyword> and the irrational exuberance around technology stocks before the dot-com bubble burst.

'Big Short' investor Michael Burry warns Reddit traders about the dangers of blind faith

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'Big Short' investor Michael Burry warns Reddit traders about the dangers of blind faith

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