Advertisement

The bearish billionaires

Three billionaire investors, who see an end to the bull market in US stocks.

As the S&P marches on and on, experienced investors are increasingly concerned that it is running out of oxygen. One is Sam Zell, a real-estate billionaire nicknamed the Grave Dancer' for his knack of profiting from distressed assets. He's worried about the gulf between the stock market's performance and the underlying economic fundamentals.

Advertisement - Article continues below

In the latest earnings season, says Zell, firms that disappointed the market mainly did so because their sales fell short of forecasts. That's a reflection of weak demand, which is hardly a hallmark of a thriving recovery with equities at record levels.

Part of the reason stocks are overinflated is that people have nowhere else to put their money amid rock-bottom interest rates. This makes the market look precarious, as the economic and geopolitical backdrop is uncertain."It's very likely that something has to give here," he concludes.

Meanwhile, George Soros has taken out put options insurance against a decline on an ETF tracking the S&P 500. The position is worth $2.2bn, or 17% of his total assets under management, says Tyler Durden on Zerohedge.com.

And Carl Icahn, the "poster-child of leveraged financial engineering", says he's nervous about US stocks. Then again, concludes Durden, investors should consider the possibility that the bearish billionaires are a contrarian indicator.

Advertisement
Advertisement

Recommended

The British equity market is shrinking
Stockmarkets

The British equity market is shrinking

British startups are abandoning public stockmarkets and turning to deep-pocketed Silicon Valley venture capitalists for their investment needs.
8 Nov 2019
There are lots of reasons to be bearish – but you should stick with the bulls
Stockmarkets

There are lots of reasons to be bearish – but you should stick with the bulls

There are plenty of reasons to be gloomy about the stockmarkets. But the trend remains up, says Dominic Frisby. And you don’t want to bet against the …
17 Jul 2019
Christopher Wood: hold a growth and value “barbell“ portfolio
Investment strategy

Christopher Wood: hold a growth and value “barbell“ portfolio

Christopher Wood, global head of equity strategy at investment banking firm Jefferies, suggests a “barbell“ strategy of holding growth and value stock…
10 Jul 2020
What gold, bonds and tech stocks have in common
Stockmarkets

What gold, bonds and tech stocks have in common

"Risk off" or "safe haven" assets such as gold and government bonds have been doing well lately. But so have riskier tech stocks. That seems to defy c…
10 Jul 2020

Most Popular

An economics lesson from my barber
Inflation

An economics lesson from my barber

On reopening his shop after lockdown, Dominic Frisby’s barber doubled his prices. It’s all part of the post-Covid inflation process – and we’re going …
8 Jul 2020
Three ideas for Lloyds Bank's new boss
UK stockmarkets

Three ideas for Lloyds Bank's new boss

The Black Horse needs whipping into shape. A change at the top provides a great opportunity, says Matthew Lynn.
12 Jul 2020
Why the moving average is my favourite charting tool
Sponsored

Why the moving average is my favourite charting tool

Traders and technical analysts use "moving averages" to iron out daily fluctuations and give a much clearer picture of a market's direction. Dominic …
13 Jul 2020