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Michael Burry has made a career out of spotting trouble before everyone else. So when he posted a short list of life rules for a 26-year-old on October 17, the line about real estate was always going to get attention.

The timing makes his advice hit harder. The average 30-year mortgage rate is 7.32% as of October 22, up from 6.19% a year earlier. For a young buyer, the question is no longer how much house to skip. It is whether any house is within reach at all.

Burry’s rule: buy half the house you can afford

Burry’s list reads more like a set of guardrails than a get-rich plan. He advised buying half the house you can afford and renting anything that flies or floats. He also noted that art’s value lives in the eye of the beholder and urged his readers to have kids, be a good parent and stay thankful and charitable.

Also read: Michael Burry doubles down on his stock market bet

That caution runs through his market calls too. In a September post, Burry argued that Big Tech’s AI commitments have grown so large that “a relatively small write-off has a bigger impact than we can now imagine,” and he sees those write-offs arriving in 2028 or 2029.

He has put money behind that view. Burry has disclosed short bets this year against Nvidia, Tesla, Micron and a leading semiconductor fund, and he has dismissed AI leaders’ calls to slow down as self-serving, arguing that large language models are not true AI and will not become AGI.

Burry’s housing rule and his market calls share the same instinct: things go wrong. In 2025, that room to absorb a mistake has largely disappeared. Senate Banking Committee staff estimated that a typical buyer now pays more a month than they did in late February, TheStreet reported.

Sellers have also noticed, offering concessions in 44.7% of U.S. sales in August, the highest August share since at least 2020. A smaller loan absorbs that kind of shock far better than a stretched one.

Michael Burry has made a career out of spotting trouble before everyone else.Thomas Barwick / Getty Images

Even half a house is a stretch now

The gap between paychecks and prices is wide. Redfin found a buyer needed to earn about $109,796 a year to afford a typical U.S. home in June, while the typical household brought in $87,599, leaving a shortfall of roughly $22,000.

In the priciest cities, the math gets absurd. Only about a third of listings nationwide were affordable to a median earner, and in San Francisco, a buyer needed more than $450,000 a year in income to afford the median home, as reported by Quartz. Even a home costing half of that would still take a six-figure salary.

Those figures were calculated before borrowing costs jumped again this fall. Fannie Mae now expects the 30-year rate to average 7.4% in the fourth quarter and 7.5% through 2027, a sharp step up from its September forecast. The Mortgage Bankers Association sees slightly lower rates, but still above 7%, according to TheStreet.

Buyers are reacting the way you would expect. “Market conditions weakened in September due to fast-rising mortgage rates,” NAR chief economist Lawrence Yun said. NAR’s pending home sales index fell 7.3% in September to its lowest reading since the series began in 2001, and contract signings dropped in every region, NAR reported.

Young buyers keep pushing the dream back

The people Burry was advising are buying later and later. The median first-time homebuyer is now 40 years old, a record high, based on National Association of Realtors data.

The generational gap is stark. Redfin found that 55.4% of millennials owned homes in 2025, compared with just 27.1% of Gen Z. And only 38.3% of 28-year-olds were homeowners as of last year. Burry’s 26-year-old is also part of the group with the steepest climb ahead.

Many are finding creative workarounds. About 22% of young adults moved back in with family before buying their first home, and NAR’s Jessica Lautz described it as a strategy to help them afford their own homes later, while noting it is not ideal or possible for everyone, as reported by TheStreet.

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The owners they hope to buy from are not moving, either. “Higher rates will definitely slow the housing market, and force those with much lower rates to stay put,” Kevin Thompson, CEO of 9i Capital Group, said, warning of a market at “a standstill for some time to come.” Alex Beene of the University of Tennessee at Martin added that “there seems to be little that will change this any time soon,” according to Newsweek.

What Burry’s rules really ask of young savers

“On October 22, Freddie Mac’s chief economist, Sam Khater, said the latest dip in mortgage rates was ‘offering some relief to prospective homebuyers.’ One soft week does not undo a year of increases, though.”

Much of what is driving prices today, Burry has argued, rests on assumptions that do not hold. He sees 2028 or 2029 as the window when those AI write-offs land, which matters for buyers counting on portfolio gains for a down payment.

That is why the quieter items on his list may matter most. Never gamble, lean on the power of compounding and keep learning were all on it, Burry said. For a 26-year-old staring at today’s prices, buying less house and letting savings grow may be the most realistic version of his advice.

Related: Goldman Sachs has a new warning for the housing market for 2027

While it’s a hard-to-explain phenomenon, Trader Joe’s canvas bags have become a global sensation, and now, Costco wants to get in on the action with its version of viral bags.

“The phenomenon didn’t appear overnight. Known for its affordable prices and carefully curated selection of seasonal snacks and private-label products, Trader Joe’s has cultivated a fiercely loyal fanbase. Its canvas tote bags, in particular, have become a global obsession, with consumers from around the world eager to get their hands on one,” The Guardian reported.

eBay shows hundreds of listings for the bags, with prices ranging from $8.99 to $50,000 for sets of multiple bags, although it’s unclear whether any have sold at the highest prices.

And now Costco has started selling two new heavy-duty canvas tote bags in the United States.

“And the designs on the club retailer’s bags bear a striking resemblance to ones sold by the specialty grocer. Made by KeepCool, the cream-colored totes sport the Costco Wholesale logo and have either black or red accents. The two-pack, which retails for $10.99 online, includes a small bag and an extra-large one,” Grocery Dive reported.

Costco shows the new items on its website.

Trader Joe’s has created a global sensation

As someone who spends about a third of his time on cruise ships, I often bring gifts for crew members I know. That could be anything from candy to personal care items they can’t get on board, or even clothes.

In recent months, however, I noticed my travel companions, PostCard Travel Planning owners Dennis and Amy Post, who keep in touch with dozens of crew members, bringing Trader Joe’s totes as gifts.

“We found out talking to several cruise ship staff, especially in the Philippines, it’s a thing. Every woman in the Philippines wants to have one and if they have the specialty ones that come out seasonal like for Easter with multiple colors they are a big deal. Also the new mini smaller bag too,” the Posts shared with TheStreet via text message.

They also did some research at the retailer.

“Spoke to a manager at Trader Joe’s Viera Florida, they have to actually limit the amount per person because people are selling them online at inflated prices so they sometimes have a 3, 5 and 10 limit on purchases,” they added. “It went viral several years ago and certain countries especially the Philippines. It’s a big deal.”

Trader Joe’s sells multiple totes:

Mini Canvas Totes / Mini Pastel Totes: $2.99 each

Standard/Large Canvas Totes: $3.99 each (Prices can fluctuate slightly based on region and material, but they typically stay under $5).

Mini Cooler/Insulated Bags: $3.99 each

Trader Joe’s canvas bags have become collectible.Shutterstock

Costco faces a challenge

Costco has not commented on its new tote bags, but RTM Nexus CEO Dominick Miserandino thinks the chain faces an uphill battle when it comes to equaling the viral success of Trader Joe’s.

“Costco can make the bag. The harder part is making people care about getting the bag,” he told TheStreet.

The formula for success, he noted, has been laid out by the cult-favorite grocery chain.

“Trader Joe’s figured out that a cheap tote can become something people actually hunt for if the colors change, the supply feels limited and people think they might miss it,” he wrote.

That does not mean that the warehouse club can’t capture the same phenomenon.

“Costco already has a fanatical customer base, and two bags for $10.99 is very Costco. If they keep changing them and give people a reason to want the next one, this could absolutely work,” he added.

The chain’s customers seem to support the idea.

“I like Costco for its great prices and good-quality products, so having the Costco tote bags feels like having little collector’s items to me. They’re practical, fun, and something I’m genuinely happy to add to my tote bag collection. I would like them even more if the canvas were a bit thicker, but the current material still feels durable,” Susan wrote on Costco’s website.

Related: Kroger cuts discounts, promises pricing changes

Warren Buffett spent nearly 50 years drinking Pepsi. His son even nicknamed him “Pepsi Warren.” Then a neighbor handed him samples of a new cherry-flavored Coca-Cola, and the legendary investor switched sides.

The soda switch made for a good story. The stock purchase that followed made history.

Buffett began buying Coca-Cola shares in 1988, and Berkshire Hathaway eventually built a 400 million-share position for about $1.3 billion. Today, that stake is worth roughly $37 billion at a share price of $93, while the annual dividend income has climbed to about $848 million.

Read more: Warren Buffett explained how he’d turn $10,000 into $30 billion if he were starting over

For an investor famous for buying businesses he understands, Coca-Cola was a particularly fitting bet. Buffett knew the product long before he owned a piece of the company. What followed was one of Berkshire Hathaway’s most enduring investments.

Berkshire Hathaway chairman emeritus Buffett, 96, took control of the company in 1965 and served as chairman for 56 years. He handed the post to his son, Howard Buffett, in September. Greg Abel became CEO in January, and Buffett remains on Berkshire’s board of directors.

New Coke leaves a mark

Coca-Cola’s troubles started in 1985, when the company replaced its original formula with New Coke. Consumer outrage followed, with thousands of angry calls a day and public protests, until the original recipe returned that year as Coca-Cola Classic.

Then came the October 1987 stock market crash, along with a pricing fight with PepsiCo that weighed on the shares. By 1988, Coca-Cola stock had been hit hard.

Warren Buffett famously drinks cans of Coca-Cola daily.Omaha World-Herald / Getty Images

Buffett buys while Wall Street rolls its eyes

Buffett started buying anyway. Wall Street largely wrote the move off as too expensive and badly timed. Analysts pointed to a price-to-earnings multiple in the mid-teens, which was not the deep-value territory Buffett was known for, and noted that earnings had softened in 1987.

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Buffett saw a different company. He viewed the business, led by CEO Roberto Goizueta and president Don Keough, as a global brand with high returns on capital and enormous room to grow overseas.

Berkshire even got permission from the Securities and Exchange Commission to delay disclosing the purchases for a year so the market would not bid the shares up right away.

Buffett made his intentions clear to shareholders. “When we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever,” Buffett wrote in Berkshire’s shareholder letter in 1988.

The secret came out in March 1989. The New York Times reported on March 16, 1989, that Coca-Cola said Buffett held a 6.3% stake.

Buffett explained the appeal in Berkshire’s shareholder letter later that year. He wrote that he started buying Cokes at six for 25 cents from the family grocery store in 1936 and selling them around the neighborhood for 5 cents each, and that he watched the product blanket the world for the next 52 years. “What was already the world’s most ubiquitous product gained new momentum, with sales overseas virtually exploding,” Buffett wrote in 1989.

Berkshire finished building its stake in August 1994. The $1.3 billion price tag comes to roughly $2.9 billion in today’s dollars, or about $3.25 per share on a split-adjusted basis.

Cashing Coke’s checks

Berkshire never sold a share, and the dividend checks have only gotten bigger. Berkshire collected $75 million from Coca-Cola in 1994. That grew to $704 million in 2022 and $816 million in 2025.

Coca-Cola raised its dividend about 4% in February, lifting the quarterly payout to $0.53 per share and marking its 64th straight annual increase. On Berkshire’s 400 million shares, that comes to about $848 million a year. It is more than 11 times the 1994 check, and each year’s payment equals roughly 65% of what Berkshire paid for the entire stake.

Buffett looked back on the investment in Berkshire’s shareholder letter in 2022, writing that the dividends grew every year “just as certain as birthdays.”

“All Charlie [Munger] and I were required to do was cash Coke’s quarterly dividend checks,” Buffett wrote in the same letter. Berkshire Hathaway vice chair Charlie Munger died in 2023.

For everyday investors, the takeaway is not that every familiar brand will compound this dramatically. It is that durable competitive advantages, steady dividend growth and extreme patience can turn an unloved stock into a cash machine decades later. The crowd in 1988 saw an overpriced soda company with a branding disaster in its past, and the longtime Pepsi drinker has been collecting on that doubt ever since.

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