Famous short-seller Jim Chanos sees a worrying trend in the market.
“I was in the street [since] 1980 [and] No bear market has traded more than nine to 14 times its previous peak earnings,” the Chanos & Co. founder told CNBC’s “Fast Money” on Monday.
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His latest warning came in the middle of the earnings season, two days before the Federal Reserve’s interest rate decision and four days before the crucial January jobs report. According to Chanos, the market cannot overcome rising interest rates and falling corporate profitability.
“Things aren’t cheap,” said Chanos, admitting that the stock is still cheaper than it was 18 months ago.
So far this year S&P 500 up nearly 5% and in the media technology When Airlines Leading profits. On Tuesday, the index fell 1.3% to close at 4,017.77.
Chanos said the market expects corporate profits to rise 12% this year, inflation to rise by 2% and the Federal Reserve to cut interest rates in the next six to seven months. says.
“If you’re a bull, it’s almost Nirvana,” he said.
Chanos, who said he doesn’t try to time the market, doubts a bullish scenario will play out.
“If you think revenue is peaking at $200 right now, it’s down quite a bit,” Chanos said. “That’s 1,800 to 2,800. [on the S&P 500]We are nowhere near that. ”
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