Auto loans stretch seven years. Groceries go on layaway. And Wall Street’s next bubble is built on the illusion that broke people can still buy.
You may not know Steve Eisman’s name, but you should. He was the investor who bet against Wall Street in 2008 and won big — to the tune of $800 million, with a current net worth in the neighborhood of $1.5 billion. If you saw “The Big Short,” Steve Carell played him as Mark Baum.
Americans are past living paycheck to paycheck. They’re living loan to loan.
These days, Eisman hosts “The Real Eisman Playbook” on YouTube. And like in 2007, he’s warning again — this time about the fragile state of the American consumer.
He isn’t alone. In a recent episode, Eisman spoke with Lakshmi Ganapathi of Unicus Research, who shares her grim view of the U.S. economy. Their conversation, combined with the data, paints a picture more alarming than most headlines dare admit.
Consumers are broke
“If you deduct the AI expenditures,” Eisman said, “… the U.S. economy is not even growing, really, 50 basis points, outside of AI.” In plain English: Without the artificial-intelligence boom, growth would be nearly flat at around 0.5% growth — likely even lower — not the 3.8% the Bureau of Economic Analysis reported for the second quarter of 2025.
Ganapathi didn’t mince words either. “Consumers are broke,” she said. “The monthly budget math no longer works.”
That’s what happens when Washington spends decades pretending math doesn’t matter. During COVID, federal “stimulus” checks poured roughly $800 billion into households. The cash wave briefly made millions look creditworthy — even as the underlying economy collapsed.
“Subprime consumers became prime,” Ganapathi explained. With reporting on student-loan and credit-card delinquencies suspended, millions suddenly looked like perfect borrowers. Credit scores soared to 700 and 800.
“They got a check that made them look richer than they actually were,” Eisman noted.
Banks then bundled those inflated loans into asset-backed securities — the same shell game that fueled the 2008 meltdown. The illusion of “prime credit” returned, this time wrapped in COVID relief and moral hazard.