The bearish billionaires

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.

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.

MoneyWeek

Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Get 6 issues free

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Sign up

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.