Hedge Fund Manager Rips Education Stocks

Steve Eisman, the hedge fund manager made famous by his starring role in Michael Lewis' The Big Short, is criticizing for-profit education companies. Eisman was probably the biggest winner from the subprime mortgage crisis. Eisman had bet billions on the fall of subprime mortgages - what he saw as a unsustainable industry taking advantage of its customers.

Now Eisman is lashing out against the stocks of for-profit schools saying, "Until recently, I thought that there would never again be an opportunity to be involved with an industry as socially destructive and morally bankrupt as the subprime mortgage industry. I was wrong. The for-profit education industry has proven equal to the task."

Stocks of education companies like Corinthian Colleges Inc and Education Management Corp were off on the announcement.

John Paulson Finally Bullish on Housing?

John Paulson, whose multi-billion dollar hedge fund Paulson & Co. famously profited from the meltdown in the subprime market is now bullish on the housing market. Yes, this is the same Paulson & Co. hedge fund which keeps coming up in the Goldman Sachs investigation as the hedge fund which was not revealed to other parties to be the firm shorting these CDOs.

Paulson believes housing prices will rise 3-5% in 2010 and 8-12% in 2011. Of course, given the recent price stabilization across the national markets, this is not that grandiose of a prediction. It certainly doesn't rival his brazen decision in the middle of the decade to heavily short the mortgage market while 99% of other investors were still clueless. In any case, investors might do well to listen to Paulson. He has been bullish on gold in 2010. So far gold is up about 10% so far in 2010.