Steve Eisman of “The Big Short” fame said if the spreading banking crisis stops the Federal Reserve from raising interest rates next week, investors should be fazed by that. “Fifty basis points is off the table. So either they’re going to do 25 basis points or they’re going to do nothing,” Eisman said on CNBC’s ” Fast Money ” Wednesday evening. “If the Fed doesn’t raise rates, … maybe it’ll be positive for a couple hours or a couple of weeks,” he said. “But the Fed won’t be raising rates because it’s scared. Well, if the Fed is scared, you should be scared.” Market pricing currently points to a coin flip for a 25 basis point rate hike when the Fed meets March 21-22 , according to CME Group data Wednesday evening. The odds of more tightening have decreased in the face of the collapses of Silicon Valley Bank and Signature Bank, and as the banking mess spread to Europe. Eisman, senior portfolio manager at Neuberger Berman, said the central bank is caught in a difficult position because if it does raise rates next week, it risks adding more pressure to the already tight financial conditions. “On the other hand, if the Fed raises rates, even in the face of this… that’s like, wait a minute, you’ve sort of caught between a rock and a hard place,” the investor said. “Financial conditions are really tightened, but you still have inflation. It’s not clear either move is good.” Earlier in his career, when he was running a hedge fund at FrontPoint Partners, Eisman famously shorted subprime mortgage loans before the 2008 financial crisis. This was chronicled in Michael Lewis’ book “The Big Short: Inside the Doomsday Machine” and the subsequent Oscar-winning movie adaptation. Eisman later launched his own fund, Emrys Partners, which he closed in 2014. Swiss regulators announced Wednesday that the country’s central bank would give Credit Suisse liquidity if necessary. Investors were concerned after the Saudi National Bank, Credit Suisse’s largest investor, said it could…
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