Steve Eisman has spent most of the years since the financial crisis being asked, in his words, to predict the end of the world. In his latest weekly wrap - recorded Thursday night as the 10-year brushed 4.8%, he says he's still not there on AI, but if he were - he lays out exactly how it would happen.
Eisman is not predicting that OpenAI fails - but it is the weak link in a chain that runs from two money-losing labs, through hyperscaler capex, to roughly half of projected US GDP growth - and arguing that it's "not too early to think about" what happens if the link breaks.
"I predicted the end of the world once, and believe me, it was no fun. I am in no rush to predict the end of the world again, unless I am really convinced that it's going to happen. But I'm not going to make such a prediction just because it will get a lot of press. There is no question in my mind that the entire US economy hinges on the success of AI. The amount being spent is just so large that were it to stop, the economy would go into a recession almost immediately."
The chain: two companies, $700 billion of capex, half of GDP growth
Eisman waves off the two "bubble" arguments echoing through the halls - and that both hyperscalers' vanished free cash flow, and Nvidia's circular financing - are survivable if AI pays off. The real vulnerability, he argues, sits one layer down:
"So where is the Achilles heel? I think that it resides with Anthropic and OpenAI, because they are so central to the entire AI food chain. According to reports from various Wall Street firms, something like 70% of hyper
