Need to Know: Steer clear of these stocks where the economy is in trouble, says Steve Eisman of ‘Big Short’ fame

by | Oct 11, 2023 | Stock Market

Storied hedge-fund manager Paul Tudor Jones is the latest to warn of a looming recession as he urges investors to be wary of stocks. Jones, who predicted the 1987 stock-market crash, has been vocal this year, such as in May when he said he saw a higher 2023 finish for stocks because the Fed was done hiking.

Investors and forecasters have been twisting themselves into knots this year trying to predict an economic pullback. Wall Street now seems to be shifting toward first quarter, as Jones has newly forecast. It’s a mug’s game — predicting a recession, that is — Steve Eisman, portfolio manager at Neuberger Berman, told CNBC Tuesday on a “Fast Money” segment. Eisman is another Wall Street legend, earning his stripes making lucrative bets against the U.S. housing market just before the 2008 collapse and global financial crisis. He got an extra shot at fame after being depicted by Steve Carell in the 2015 hit, “The Big Short,” based on the same-name Michael Lewis book about those bets. In our call of the day, Eisman lays out where investors should be focusing their concerns right now, offering sectors and parts of the economy to avoid. First up, “the consumer is fine, it’s fine,” he tells the broadcaster. “The consumer has savings, the consumers is employed, the consumer has income. So it’s not a data point, in terms of there being a recession, where I think you could be negative, it’s just that rates are a lot higher.” So it’s more expensive to buy a house, or car and any part of the economy that requires the consumer needing finance to buy something will be problema …

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