COOPERMAN: Four signs that we're entering a bear market
Wall Street WeekLeon Cooperman, legendary CEO of Omega Investment, divulged four points he uses to predict the onset of a bear economy during his appearance on Wall Street Week Sunday with hosts Anthony Scaramucci and Gary Kaminsky.
Cooperman, who has a rather bullish outlook for 2015, gave his four points that signal the start of a bear market (which he doesn't see now):
1. "The Stock Market smells a recession and starts to decline in anticipation."
2."People get really exuberant - euphoria."
3. And then there are unpredictable factors, like geopolitical events.
4. The last point is specific to our current market."The Fed takes the punch away from the punch bowl," said Cooperman. Basically saying that we may see the market turn down when the federal reserve starts raising interest rates making other assets as attractive as stocks.
Cooperman expanded on his final point, saying "If a year from now, the rates have not gone higher, then you've got a problem. Because of the inability of the folks in Washington to get their act together, the entire burden of dealing with the 2008 economic debacle fell on the shoulders of the Fed."
While the low rates have been a plus for asset prices, Cooperman said the bubble is not in the stock market.
"If there is a bubble, it's in the bond market."
Watch the full episode of Wall Street Week here.