Steve Eisman is predicting some tough times ahead for Canadian banks.
Steve Eisman the money manager who bet against the U.S. housing market before the 2008 financial crisis, is predicting tough times ahead for Canadian lenders.
In an interview with the Financial Times as reported by BNN Bloomberg, Eisman said “Canadian lenders are not ‘mentally prepared.’
‘“I’m calling for a simple normalization of credit that hasn’t happened in 20 years,” said Eisman, whose bets against the U.S. housing market before the 2008 financial crisis were chronicled in Michael Lewis’s 2010 book, which was later made into a film of the same name.”
Notably, with home sales falling 9.1% in February, and with the economy slowing, Eisman is expecting damage to ‘Canadian bank stocks and the real estate sector,’ though he doesn’t expect it to get as bad as it did in the U.S.: “This is not ‘The Big Short: Canada’ — I’m not calling for a housing collapse.”
Eisman’s warning is the latest in a growing number of concerns being expressed about the Canadian economy, concerns that were not addressed in the federal budget.
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