US BOURSE MUST LOOK AT NAT’L DEBT, BILLIONAIRE SAYS

As the US stock market has made a dramatic recovery from March lows, it has felt at times as if the market and the economy are no longer on speaking terms, Clare Duffy wrote for CNN Business on Monday, Tuesday, July 21, 2020 in Manila.

While the stock market has been volatile in recent months, it has trended strongly upward and the Nasdaq has hit record highs. Meanwhile, the US continues to experience surging coronavirus cases, bankruptcies and store closures, elevated unemployment figures and other signals of an economy in trouble.

Hedge fund billionaire Leon Cooperman said he thinks the market is overvalued, and that it is overlooking "a number of things." Chiefly, he said, the market "is not recognizing the risks that we face: the China relationship deteriorating, the tremendous increase in debt in the system, certainly from the election, the virus issues," Cooperman told CNN's Christine Romans in an interview that aired on "Early Start" Monday.

The nation's rapidly growing national debt is among Cooperman's biggest concerns. Instead of whittling down the federal deficit when the economy was strong, Trump directed the federal government pile on even more debt to pay for massive tax cuts and spending surged, which meant the country entered the coronavirus crisis in rough financial shape. Now, the national debt is exploding as Washington scrambles to rescue the US economy from the shock of the pandemic. "I am focused on something the market is not focusing on at the present time and that is: Who pays for the party when the party is over?" Cooperman said. The deficit is growing at a rate "well in excess of the growth rate of the economy," he added. "To me, that means more of our nation's income will have to be devoted to debt service, which will retard economic growth in the long term."