Davos WEF
Davos WEF

I see 'irrational complacency' in Davos, and asset 'bubbles everywhere' — billionaire Jeff Greene

Key Points
  • The titans of global finance in Davos are too optimistic about the stock market and the economy, the American developer says.
  • "You get some inflation. You get higher interest rates," Greene says. "That's where the game is over."
Billionaire investor says there's 'irrational complacency' in the global economy
Billionaire investor says there's 'irrational complacency' in the global economy

The titans of global finance at the World Economic Forum are too optimistic about the stock market and the economy, American billionaire real estate investor Jeff Greene told CNBC on Friday.

"There are 2,000 people [here], and I don't think I've met one person who's been negative," Greene said on "Worldwide Exchange" in an interview from the annual economic gathering in Davos, Switzerland.

"Alan Greenspan talked about 'irrational exuberance.' What I'm seeing is 'irrational complacency' here," argued Greene, a philanthropist and founder of the Greene Institute, which focuses on wealth inequality and education.

Greene echoed the caution expressed Thursday by Jim Coulter, the billionaire co-founder of private investment powerhouse TPG. Coulter told CNBC from Davos, "My biggest concern is how little concern there is." Coulter said he's worried the Trump bump in the market and the economy is only setting up a bigger fall down the road.

By contrast, Jamie Dimon, the J.P. Morgan Chase CEO, and Goldman Sachs chief Lloyd Blankfein told CNBC in interviews on Wednesday they like what Trump has done for the economy so far.

"I'd say I like a lot more stuff than I don't like, and some of the stuff I don't like I really don't like," Blankfein said.

Dimon was more emphatic about the economy's potential. "I think it's possible you're going to hit 4 percent some time this year."

Greene said the optimism from Dimon and Blankfein and others makes his point. "Everyone just feels that we've got a perfect global economy. We're all growing together at 3 percent-plus. Everything is going hunky-dory."

However, Greene, who became a billionaire betting against the housing market during the financial crisis, said he's concerned about the economy getting overheated. "That's where the game is over. You get some inflation. You get higher interest rates. What happens to real estate values, the art market. What happens to the stock market, the bond market."

In a "Squawk Box" interview from Davos on Friday, J.P. Morgan Asset Management CEO Mary Erdoes made the bullish case for stocks, arguing "just because people are optimistic doesn't mean they're unrealistic."

Erdoes and Greene spoke to CNBC hours before President Donald Trump addresses Davos.

"I'm a Democrat. I don't agree with a lot of things he's doing," said Greene, who lives next to Trump's Mar-a-Lago Club in Palm Beach, Florida where the president often spends time away from the White House.

Greene said he met with Trump last week, and they talked about Davos. "I told him the one thing about Davos is we welcome our world leaders here with the ultimate amount of politeness and cordial approach." Trump has been received warmly at the conference and he should be, Greene added.

"He's [also] coming really with a much different machine than he started with," Greene said.

"When you look at an administration, it's kind of like an orchestra," he added. "You know, the first time you practice you have a lot of really bad sounding violins and cellos not playing together."

But now, "they're all really singing the same tune," Greene said. "Together, the team is working together as a team."