Blackstone’s Byron Wien: Time To Be Cautious On Stocks

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The Blackstone Group L.P. (NYSE:BX) Advisory Partners Vice Chairman Byron Wien spoke with FOX Business Network’s (FBN) Liz Claman about his concerns surrounding the stock market. Wien said, that “it’s unrealistic to think the market could continue to go up at the rate it’s gone up so far this year.” Wien went on to discuss, that our economy is slowing down and so are “economies around the world” and therefore, “it’s time to be cautious.”

Blackstone's Byron Wien: Time To Be Cautious On Stocks

Excerpts from the interview with Byron Wien are below.

On the outlook of the stock market:

“The market has already given you a full-year’s performance and we’re only at the beginning of June. It’s unrealistic to think the market could continue to go up at the rate it’s gone up so far this year. There’s bound to be a correction. You have earnings problems, you have the economy slowing, you have all the economies around the world slowing, demand for U.S. products are slowing, so my view is it’s time to be cautious.”

On what fissures Byron Wien is starting to see:

“Earnings were up 3% in the first quarter, S&P 500 operating earnings. They’re going to be up 5% in the second quarter.  Analysts are projecting them to be up 11% in the third quarter and 15% in the fourth. And I’m suspicious you won’t see double digit gains in the third and fourth quarter. I think it’ll be below that and therefore earnings disappointment is the first of the fissures that you’re referring to.”

On whether Japan’s asset purchases are happening in the United States also:

“A significant portion of those asset purchases go into financial assets and that’s happening here too. And that’s probably the second of the fissures. There’s no question that the Fed is going to slow down at some point. Now if they did $60 billion a month, instead of $85 billion that would still be a lot, but I think the market might interpret that as something negative.”

On whether the price of oil going down:

“The key thing is I think the price of oil is coming down. I just think it is coming down because production is up, imports are down, there’s a lot of oil out there and as long as we can extract it from rocks. I think the price is going lower.”

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