Whale Watching: Cooperman, Loeb Reveal Investments
An informative and entertaining look at the must-see CNBC moments that will sharpen your business edge today, tomorrow and beyond. What follows is a look at some of the most compelling conversations and noteworthy moments broadcast on CNBC on Thursday, May 9.
How about a little whale-watching?
No, not the large aquatic mammals! (Although, that does sound like fun.) We're referring to the investing strategy of monitoring the investments of the most influential or the wealthiest investors, also known as "whales."
Billionaire Leon Cooperman, who runs hedge fund firm Omega Advisors, certainly fits the bill. CNBC's Scott Wapner caught up with Cooperman at the SkyBridge Alternatives conference in Las Vegas, better known as the SALT conference, which attracts some of the best and brightest to discuss issues affecting the stock market and economy alike.
Cooperman said he's modestly optimistic about the stock market.
"I think the stock market is probably a little bit ahead of itself, but I think by and large the bull market has more time to run," said Cooperman, adding that investors don't seem to care about the sluggish economy because the Federal Reserve's bond-buying program has been successful in stimulating equities.
Looking forward, Cooperman said just two things could take the markets lower: Investors become fearful about recession and start to sell; or the Fed ends its asset-buying program, spurring a correction of 15 percent 20 percent. But as long as the current monetary policy holds, he thinks investors should continue buying.
Today, Cooperman disclosed that his fund has taken positions in technology solutions provider Monitise, and engineering and construction firm Technip. He said there's no shortage of cheap stocks, such as American Insurance Group, Citigroup and MetLife, all of which his fund has held for a long time.
Later, billionaire hedge-funder Daniel Loeb told CNBC's Wapner off-camera that his Third Point fund sees Japan as one of the best investment opportunities currently. Loeb's fund is short the Japanese yen and long the Nikkei, a stock market index for the Tokyo Stock Exchange. Third Point also has a position in Japan Tobacco, Loeb told Wapner.
Earlier this year, Loeb feuded with friend and rival hedge-fund titan Bill Ackman over nutritional supplement maker Herbalife.
Ackman criticized Herbalife, publicly calling the company a "pyramid scheme," sending its shares sharply lower. Loeb called the claims "preposterous" and thought the subsequent drop in the stock was a "big overreaction," prompting Third Point to buy a massive stake in Herbalife.
But, Loeb told Wapner, his fund sold out of Herbalife a few months ago, having "moved on to other things."
Earlier, billionaire private equity tycoon Steve Schwarzman appeared on "Squawk Box," downplaying concerns about the Fed's bond-buying program. After all, he said, the Fed's $3 trillion-plus balance sheet is a drop in the bucket compared with the entire U.S. banking system.
"When the [financial] crisis started, the U.S. Fed was only about $800 billion. Citibank was about four and a half times the size of our entire central bank. That seems a bit odd to me," said Schwarzman, CEO of the Blackstone Group, a private equity and financial advisory firm.
"The idea that the central bank is now at [about] $3 trillion and Citibank is down to around $2.4 trillion still doesn't seem like the central bank is massively scaled to the size of the U.S. banking system in total," he added.