Big Short legend Steve Eisman says everyone is buying the wrong AI stocks

Steve Eisman has a simple way to explain why Space X is the most absurd stock in America: its revenues are roughly equal to those of the company that makes Froot Loops. The difference? Nobody is valuing Kellogg’s at 100x revenue. If you’ll recall, Eisman identified that a housing bubble was building in 2006 and 2007, fueled by an explosion in the issuance of “teaser-rate,” sub-prime mortgages, and that a crash was imminent. He famously seized the moment by shorting the home-loan market big time, a move that greatly profited both the trader and his firm FrontPoint Partners, a subsidiary of Morgan Stanley. Michael Lewis made Eisman a Wall Street legend by chronicling his exploits in his 2010 bestseller The Big Short. In the 2015 film version, Steve Carrell played the famously cranky, contrarian (re-named “Mark Baum”), while Marisa Tomei portrayed his wife and co-skeptic, former J.P. Morgan analyst Valerie Feigen (“Cynthia Baum”). Today, Eisman hosts the weekly podcast “The Real Eisman Playbook,” a program I highly recommend as much for its rollicking mockery of the group think that dominates the sell-side stock community as its sharp insights on economic trends and knack at nailing the basics that over time, drive outstanding returns to investors. In a half-hour phone call, Eisman skewered the latest case where he reckons that hype and hysteria are fogging minds—and it’s hardly surprising that his new target’s none other than the SpaceX phenomenon. “SpaceX has the revenues of Kellogg’s, which makes Froot Loops, which I love, but no one is going out of their way to buy Froot Loops,” he declares. (The Ferrero Group of Italy bought Kellogg’s cereal business; Ferrero’s 2025 revenues of $21 billion are indeed close to SpaceX’s $19 billion.) “SpaceX stock’s being valued at over 100 times revenue, whereas no company of any size has ever had that kind of valu