Bill Fleckenstein is a well-known bear on the market, and he has long been on the record claiming that stocks are overpriced and the market is due for a drop. But that doesn't mean he'd recommend being short. Actually, he says that shorting stocks has become all but impossible.

"Bad news doesn't really matter, and you can't really be short, because the Fed is putting in all this money," Fleckenstein said on Tuesday's "Futures Now." "It's been very difficult to see stocks decline—even bad news is pretty much shrugged off."

The contrarian says recent trading in stocks that reported below-consensus earnings is extremely telling. "We've had quite a lot of weak numbers emanating from big tech stocks, and it hasn't really done that much damage," Fleckenstein said.

For instance, while Google's Thursday earnings disappointed the market, and caused the stock to open 4 percent lower, buyers throughout the rest of the day and over the days following brought the stock back nearly exactly to where it was.

In a different sector, Coca-Cola's weak numbers led that stock to open 3 percent lower—before those shares, too, bounced back.

So what's a short-seller to do?

"I closed my short fund down a few years ago, because I thought this money printing would make it difficult to be short," Fleckenstein said.

"Having said that, coming into this quarter and last quarter, I tried a few shorts. Last quarter that kind of worked—if you caught companies that missed numbers, the stocks declined. This quarter I tried a few, it didn't work and I got out of the way. I don't know what's going to make stocks go down."

Fleckenstein says the inability to short stocks is a terrible sign for the market. "I think stocks are mispriced in the aggregate, because I think the bond market is radically mispriced, and it's mispriced because of the Fed's policies," he said.

"We're increasing the risk in the market, people are getting sucked in, and they're going to get hurt—even if the markets are going to go higher in the short run."

The one problem? He doesn't know when this cataclysmic event will transpire. "Just because something is mispriced," Fleckenstein said, "that doesn't mean it's going to change anytime soon."

—By CNBC's Alex Rosenberg. Follow him on Twitter: @CNBCAlex.

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