Billionaire investor Leon Cooperman told CNBC on Wednesday that he believes the stock market will struggle to generate significant returns in the coming years, after his robust recovery from pandemic lows in the last 10 months.
“I think the short-term outlook is probably OK. In the long run, I think we’re borrowing from the future,” Cooperman told Squawk Box.
“Whenever you bought on the market when it was currently sold in multiples of, for example, 22 times or more, you never earned serious money in a year, three years, five years. I think that’s what we’re looking at, “the Omega Family Office chairman added.
The Federal Reserve’s accommodative monetary policy, along with Congress’ aggressive fiscal stimulus in response to the pandemic, “pours more fuel into the fire,” on Wall Street, Cooperman said.
“There’s a significant piece on the market today that is in euphoria. You see 50% price movements. You see a SPAC per minute. These are things that ring the bell,” Cooperman said.
As he studied the market, Cooperman said his approach was to “look for value.” He added: “I have long-term concerns because I think the policies we are pursuing are unsustainable.”
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“Then we have the attraction of a new administration,” which is likely to pursue policies such as higher corporate taxes and more regulations, he said, adding that he believes those policies could affect the stock market. “It’s a less pro-business environment, less friendly,” he predicted.
A frequent critic of Progressive Democrats and past President Donald Trump, Cooperman said he voted for Biden in November, even though he was “against his own economic interests.” Instead, he said he voted for “my values, and my values did not belong to President Trump.”