By BEN SHIMKUS, CONSUMER REPORTER FOR DAILYMAIL.COM
As Wall Street revels in steady — though slow — gains, Steve Cohen, the billionaire behind Point72 Asset Management and the owner of the New York Mets, isn’t so optimistic.
With a net worth of $14.8 billion, Cohen’s insights carry weight. The billionaire has expanded his net worth through several boom and bust cycles in the U.S. economy.
In rare public commentary on the state of the economy, Cohen expressed concerns about short-term market stability.
‘I think the best gains have been had,’ Cohen said during a summit in Miami. ‘It wouldn’t surprise me to see a significant correction.’
He said three main policy frameworks from the Trump administration are giving him pause.
Cohen said tariffs will increase prices. He said immigration policies will depress a jobs market that already has a shortage of workers.
He also worried that consistent federal job cuts from Elon Musk’s DOGE threaten to stem the flow of cash in certain markets.
‘Tariffs cannot be positive, I mean it’s a tax,’ he told viewers at the meeting. ‘On top of that we have slowing immigration, which means the labor force will not grow as rapidly as… over the last five years.’
At Point72, Cohen’s team now predicts a sharp decline in U.S. economic growth, forecasting a drop from 2.5 percent to just 1.5 percent by the latter half of the year.
The economy grew at 2.8 percent in 2024 and 2.9 percent in 2023.
Other major investors are also pointing to potentially worrying signs as they warn about potential stock crashes.
Bank of America said that some of the nation’s biggest companies are suffering from ‘stock fragility’ as their market values rise well above their revenues.
Jamie Dimon, the JPMorgan Chase CEO, recently said stock prices are ‘kind of inflated, by any measure.’
Even Warren Buffett, the most iconic investor of our time, has pointed to the ‘Buffett Indicator’ as a potential sign of weakness.
The indicator compares the market cap of all the publicly traded stocks in the US to the country’s gross domestic product. A perfect economy runs close to a one-for-one ratio, according to Buffett.
The market cap is currently twice the gross domestic product.