In Michael Lewis’ seminal book and the movie about the global financial crisis –Eisman was portrayed as deeply sceptical of the bet against the housing market that would eventually make him famous.until Eisman and his team went and did the groundwork – visiting cities central to the US housing boom, and meeting borrowers and mortgage brokers – that he launched his version of the big housing short.
The first is artificial intelligence; Eisman is a believer, but says it’s way too early to pick the second and third-order beneficiaries that he sees will win from the new AI apps that are eventually developed. “For the first time since I can remember, this whole group now has a real secular story,” Eisman says. “Not that they’re not cyclical. They are cyclical, but they have secular tailwinds that they’ve never really had before. And those tailwinds are going to last quite a long time.”
This AI boom leads to Eisman’s third tailwind. Because of the increased demand for power from data centres, electricity grids will need to be expanded and upgraded.Demand for grid upgrades will also be boosted by Eisman’s fourth tailwind: renewable energy. The push towards greener power will have long-lasting implications for infrastructure spending, boosted by policy initiatives such as the Inflation Reduction Act.