US Markets

Cooperman: Confidence is back now that the feds will no longer have 'their foot on the throat of the economy'

Cooperman on markets: Much more restrained in my optimism

Hedge fund manager Leon Cooperman told CNBC on Thursday he sees 2017 as a period when the U.S. moves toward "normalization" under Donald Trump.

"I think interest rates are going to go up. Inflation is going to go up. Corporate profits are going to go up. And price/earnings ratios are likely to decline," the chairman and CEO of Omega Advisors said on "Halftime Report."

Cooperman said a surge of confidence has entered into the system, since Trump's Nov. 8 victory. He said he is fairly neutral to mildly positive on the market, but said the markets could benefit if the president-elect delivers on his policy goals, like slashing taxes and regulations.

"My most optimistic scenario would be something like 17 multiple on $140 in S&P earnings, and that number I think is 23.80," he said. "And we're 22.50 or 60. So, 5 percent upside, 2 percent dividend, 7 percent something like that."

"This is a real indictment to the prior administration," he said. "This great optimism, the feeling was previous regulators had their foot on the throat of the economy and the economy was suffocating. And we'll have to basically wait and see."

In September, Cooperman and his hedge fund were accused by the Securities and Exchange Commission of using insider information in 2010 to generate illegal profits, and then allegedly trying to cover their tracks.

Cooperman also told CNBC on Thursday he is "truly surprised at the destructive power the SEC has." He said the charges have meant a reduction in Omega Advisors' assets under management by more than half, to $3.4 billion, but added he is optimistic that a judge will find no wrongdoing.