“Top real estate investor Sam Zell is predicting stocks will soon tumble.
“Right now you are buying at an all-time high,” Zell said at a hedge fund conference in Las Vegas, according to Fortune magazine. “And there are times when stocks hit a high, and then go higher, but that’s when you have a good economy.”
Stocks are up 15 percent so far this year and the Dow Jones Industrial Average has passed 15,000 for the first time. But while stock prices are booming, underlying fundamentals remain weak, said Zell, chairman of Equity Group Investments, noting his own companies are still struggling to increase revenues.
Editor’s Note: Billionaires Dump Stocks. Prepare for the Unthinkable.
“The current euphoria in the stock market will be adjusted,” Zell stated, Fortune reported. “And I hope that’s all that happens.”
Besides the weak U.S. economy, other causes for concern are the turmoil in the Middle East and the Bank of Japan’s push to re-energize its economy by increasing inflation.
“That’s not QE [quantitative easing],” he said of Japan’s policy. “I don’t know what you call it.”
Zell believes the housing market might also be in a bubble, as large investors are buying houses in large quantities, pushing up prices. They might end up losing money, warned Zell, who noted that managing houses is more difficult that owning apartment buildings…”
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