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Big Short investor bets against UK banks | Big Short investor bets against UK banks |
(35 minutes later) | |
An investor who predicted the 2008 financial crisis has revealed he is betting against the UK banking system. | An investor who predicted the 2008 financial crisis has revealed he is betting against the UK banking system. |
Steve Eisman, known for appearing in The Big Short, said he had bets against three UK banks, though he declined to name them. | Steve Eisman, known for appearing in The Big Short, said he had bets against three UK banks, though he declined to name them. |
The US investor shot to fame when he featured in the book by Michael Lewis, and was later played by Steve Carell in the Hollywood adaptation. | The US investor shot to fame when he featured in the book by Michael Lewis, and was later played by Steve Carell in the Hollywood adaptation. |
Mr Eisman said he expected UK markets to fall as a result of Brexit. | Mr Eisman said he expected UK markets to fall as a result of Brexit. |
Explaining his current investment position, he said that he bet against two UK banks "about a month and a half ago" due to the possibility of Britain leaving the EU and of Jeremy Corbyn becoming prime minister. | Explaining his current investment position, he said that he bet against two UK banks "about a month and a half ago" due to the possibility of Britain leaving the EU and of Jeremy Corbyn becoming prime minister. |
"I think in either eventuality the British market will go down," he said. | "I think in either eventuality the British market will go down," he said. |
He added that he decided to bet against a third bank because it "seems more likely that Theresa May's proposals will fail". | He added that he decided to bet against a third bank because it "seems more likely that Theresa May's proposals will fail". |
Known as shorting, the bets against the banks will pay out if the banks' shares fall. | Known as shorting, the bets against the banks will pay out if the banks' shares fall. |
Asked which banks he thought were vulnerable, he said "it doesn't matter which UK banks I'm short. I could have picked three others", adding that he saw it as an "industry" issue. | Asked which banks he thought were vulnerable, he said "it doesn't matter which UK banks I'm short. I could have picked three others", adding that he saw it as an "industry" issue. |
Mr Eisman said he would not reveal which banks he was betting against. | |
During the financial crisis, Mr Eisman worked for a hedge fund called FrontPoint Partners, and his bets against financial markets reportedly led the company's assets to double to $1.5bn. | During the financial crisis, Mr Eisman worked for a hedge fund called FrontPoint Partners, and his bets against financial markets reportedly led the company's assets to double to $1.5bn. |
He now works for Neuberger Berman, with investment strategies that include positions in the UK and the US. | |
On the US economy, he said he thought President Trump's trade war with China was "correct". | On the US economy, he said he thought President Trump's trade war with China was "correct". |
"You're not going to get China to change by asking." | "You're not going to get China to change by asking." |
Asked if, like some leading investors, he anticipated another global financial crisis, he said: "I actually don't think so. | Asked if, like some leading investors, he anticipated another global financial crisis, he said: "I actually don't think so. |
"The financial system in the United States is safe for the first time in the 30 years I've analysed it." | "The financial system in the United States is safe for the first time in the 30 years I've analysed it." |
In September, hedge fund chief Ray Dalio revealed that he expected a new crisis in the next two to three years. |