Investor Alert

New York Markets Close in:

Key Words Archives | Email alerts

Jan. 25, 2021, 11:00 a.m. EST

When the bull market breaks, it’s ‘likely to break hard,’ warns longtime bear who suggests investors are putting too much faith in the vaccine

Watchlist Relevance

Want to see how this story relates to your watchlist?

Just add items to create a watchlist now:

  • X
    Federated Hermes Prudent Bear Fund;A (BEARX)
  • X
    Gold Continuous Contract (GC00)
  • X
    Bitcoin USD (BTCUSD)

or Cancel Already have a watchlist? Log In

Shawn Langlois

That’s David Tice, the former manager of the Prudent Bear Fund /zigman2/quotes/209249238/realtime BEARX -0.89% , explaining to CNBC in a recent interview why he believes the market will eventually take a 30% hit that will last two years.

“We now have a Biden administration that has a Senate and a House. They’re likely to enact very much more anti-capitalist policies,” he said on Friday. “They have already raised the minimum wage. That’s going to hurt earnings on the cost side.”

Tice, known for making bearish bets through his career, has had his share of misfires. In fact, the AdvisorShares Ranger Equity Bear ETF HDGE , where he now serves as an advisor, has lost about a third of its value over the past three months.

The fund, however, is designed to benefit when the market gets beaten up, and Tice believes that day is coming. The problems, he said, are piling up, whether it be lofty valuations or perhaps putting too much faith in getting control of the pandemic.

“The vaccine is not really a panacea,” Tice told CNBC. “We’ve seen a lot of optimism about that, but there are new strains of the virus, and there is certainly risk going forward.” So what’s an investor to do in this climate? Tice is bullish on gold /zigman2/quotes/210034565/delayed GC00 +0.62% and bitcoin /zigman2/quotes/31322028/realtime BTCUSD -0.02% .

“Gold is dramatically under-owned by individuals and portfolio managers,” he said. “I don’t think that bitcoin can be ignored. We have seen the price of bitcoin go from $10,000 to $40,000 which I think is foreshadowing potentially what might happen in gold.”

Here are his comments:

Stocks were breaking a bit in Monday’s session, with the Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA +0.03% down more than 200 points. The S&P 500 /zigman2/quotes/210599714/realtime SPX +0.17% was also in the red while the tech-heavy Nasdaq Composite COMP managed to push higher.

US : U.S.: Nasdaq
$ 7.79
-0.07 -0.89%
Volume: 0.00
Dec. 8, 2022
US : U.S.: Nymex
$ 1,812.60
+11.10 +0.62%
Volume: 108,271
Dec. 9, 2022 11:22a
US : CoinDesk
-4.17 -0.02%
Volume: 0.00
Dec. 9, 2022 11:32a
US : Dow Jones Global
+11.47 +0.03%
Volume: 0.00
Dec. 9, 2022 11:32a
+6.65 +0.17%
Volume: 0.00
Dec. 9, 2022 11:32a

This Story has 0 Comments
Be the first to comment
More News In

Story Conversation

Commenting FAQs »

Partner Center

Link to MarketWatch's Slice.