• Billionaire investor Leon Cooperman said on a Monday interview with CNBC that he expects stock market returns to slow going forward.
  • “The overall market, we’ve been pulling a lot of demand forward. I would expect that future returns will be relatively unimpressive for a long time,” Cooperman said.
  • He added that the stock market rally, which has been driven by the Federal Reserve’s pledge to hold interest rates near zero for a long time, may lose momentum as the coronavirus pandemic recession continues on, hurting the US economy and businesses.
  • Read more on Business Insider.

Billionaire investor Leon Cooperman warned in a Monday interview with CNBC that stock market returns are likely to be “unimpressive” for some time following this year’s swift rebound rally.

The stock market has recovered from its coronavirus pandemic low in March in record time, reentering a bull market fueled by the Federal Reserve’s pledge to keep interest rates low for a long time, according to Cooperman.

But he’s hesitant about future returns. “I am uncomfortable at the present time,” said Cooperman. “Who pays for the party when the party is over?”

“The overall market, we’ve been pulling a lot of demand forward. I would expect that future returns will be relatively unimpressive for a long time,” Cooperman said.

Read more: 35-year market vet David Rosenberg warns the stock market's rally features distortions that were glaring during the tech bubble - and lays out his plausible scenario for a crash

Cooperman's conservative view hinges on the huge amounts of debt he sees the US adding up. "We came into 2020 with a full employed economy, yet we were running a trillion-dollar deficit. And now we're piling a lot of debt on top of that," said Cooperman.

He added that the stock market rally, which has been driven by the Fed, may lose momentum as the coronavirus pandemic recession continues on, hurting the US economy and businesses. He also pointed out that Japan and Europe have had zero or negative interest rates for some time, but their price-earnings ratios are lower than in the US.

"What people have to understand is that the Fed is pursuing this zero-interest rate policy not because things are good in the economy," said Cooperman. "They're pursuing a zero-interest rate policy because things are bad in the economy."