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Leon Cooperman: Stock Returns Will Be ‘Unimpressive for a Long Time’

Billionaire investor Leon Cooperman predicted that stock-market returns could possibly be disappointing for a “long time” with this yr’s seemingly infinite rally draining future positive factors.

“The overall market, we’ve been pulling a lot of demand forward. I would expect that future returns will be relatively unimpressive for a long time,” he told CNBC.

“We came into 2020 with a full employed economy, yet we were running a trillion-dollar deficit. And now we’re piling a lot of debt on top of that. And so I would have to say I have a conservative view,” he added.

“What’s driving the whole thing is interest rates,” Cooperman mentioned. “What people have to understand is that the Fed is pursuing this zero-interest rate policy not because things are good in the economy. They’re pursuing a zero-interest rate policy because things are bad in the economy.”

Cooperman, who based funding agency Omega Advisors within the early 1990s, just lately turned it into a household workplace on the finish of 2018. He famous that the financial system has had some kind of authorities help for the reason that monetary disaster.

Meanwhile, Cooperman told CNBC he’s not positive whether or not he’ll vote for President Donald Trump or Democrat Joe Biden in November.

“Everybody thinks that Biden is a socialist. I don’t think so, but … he’s got to speak out loudly and clearly what he stands for,” the Omega Family Office chairman mentioned on “Squawk Box.”

Cooperman mentioned Trump has “limited character” however “good economic ideas.”

“I have not decided,” Cooperman mentioned on “Squawk Box.” But the Omega Family Office chairman added that, “this election, in my opinion, is pivotal in the long-term outlook,” he mentioned.

“We have to make sure that we stay as a capitalist nation. Everybody thinks that Biden is a socialist. I don’t think so, but he’s got to speak out. He’s got to speak out loudly and clearly what he stands for,” Cooperman mentioned.

However, others are far more optimistic concerning the market’s future.

Billionaire hedge fund supervisor William Ackman touted the success of his funds final week, citing engaging valuations for his holdings and saying he has as much as $7 billion to spend money on a non-public firm, whereas saying that opening inventory possession to all Americans is a key to political stability.

For a second straight yr, Ackman’s Pershing Square Capital Management is producing double-digit returns with a 44.1% achieve at his Pershing Square Holdings portfolio. Four of 9 portfolio corporations, together with Lowe’s and Chipotle Mexican Grill have gained regardless of the Covid-19 outbreak, Reuters reported.

“Our current holdings remain attractively valued, offering substantial additional profit potential over the long term,” Ackman wrote to buyers, including that even these within the pink, together with Hilton Worldwide, “will recover in the long term.”

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