Episode
'Moral Hazard on Steroids': The Investor Who Called the Big Short Says Carney's Condo Bailout Is Worse Than 2008 Subprime Fiasco
- Podcast
- The Bureau Podcast
- Published
- Jun 22, 2026
- Duration seconds
- 4260
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Summary
VANCOUVER — Marc Cohodes built his name and his fortune betting against frauds, from small public companies to the American subprime-mortgage machine that collapsed in 2008. This week, he returned to The Bureau with a blunt verdict on Prime Minister Mark Carney’s plan to spend up to $3.2 billion absorbing Vancouver’s unsold condominiums: he has seen this movie before, and this version is worse. “This Carney buying back Vancouver condos is just really rich,” Cohodes said, “especially on the backdrop of him cutting a deal with China.” What makes it worse than 2008, Cohodes says, is not the size of the losses but the refusal to let them happen at all. In the United States, Cohodes notes, the government let housing fall — “everything went down 40 to 50 percent” — and only then stepped in to keep the banks and brokerages from failing, once the leveraged players had taken their hits. Painful, but the market cleared and prices found a level. Canada, he argues, is doing the opposite: propping up prices before anyone is allowed to lose. “Here, the Canadian government won’t even let the prices clear,” he said. The result, in his words, is “a moral hazard on steroids, which encourages these developers then to go and do this again, and do it again on probably a greater scale.” Moral hazard is the concept Carney, a former central banker, knows intimately, and Cohodes defines it the way a short-seller does: “people doing bad things and taking exceptional risk to benefit themselves. And the risk eventually gets subsidized by the federal government, aka the taxpayer.” Reward the people who built and bought at unsustainable prices, he argues, and you have taught the next cohort that the downside is socialized. His prescription is the mirror image of the bailout, and it is the same argu…