Steve Eisman
Investor known for betting against the subprime mortgage market before the 2008 financial crisis, a story told in Michael Lewis's book The Big Short.
“The basic problem with the entire AI enterprise is that there are no moats. None. Absolutely none. One model is good one day and then people switch to the next. It's not like Google. Everybody was on Google forever.”
The Compound and Friends · October 2026
Eisman argues the AI labs face a price war from cheaper open-weight models, and that their calls for regulation are partly an attempt to shut out competitors. Here he contrasts how freely users switch between models with how locked-in Google search users were.
Transcript
…Mercedes-Benz for every road trip. So they're losing market share. There's pretty good evidence that a price war is starting and they're petrified. And so they created this, the world's going to end unless you regulate us because they think if they get regulated, they can manipulate the regulation.
Or they could stop the open weight models. That's too much.
They could manipulate the regulation to keep the Chinese open weight models out and so they could have a duopoly. And the basic problem with the entire AI enterprise is that there are no moats. None. Absolutely none. One model is good one day and then people switch to the next. It's not like Google. Everybody was on Google forever. No one ever, you even, you were on Google forever so much. The concept of not being on Google, you couldn't even think that. Today you use Claude. Claude one day, you don't like that. You go to Gemini. You don't like use that for a while. You go to Chat GPT. There are no moats. People are spending a trillion dollars. Are you surprised
by that? How easy it is for people to switch from one to another?
I'm not surprised or surprised. It is what it is.
Right. Okay. Because I always thought the one that would win was the one that remembers the most.
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