Billionaire Chamath Palihapitiya sees US stocks rebounding rapidly as trillions of dollars rush back in from the sidelines
- Billionaire investor
Chamath Palihapitiyasaid US stockscould rebound rapidly after the recent sell-off.
- He said there's "a ton" of money waiting on the sidelines in products such as money market accounts.
Billionaire investor Chamath Palihapitiya has said stock
Palihapitiya said in his All In podcast at the weekend that he thinks markets have likely "puked it all out" after falling sharply in recent days. Stocks have dropped as investors come to grips with the likelihood that the
"There is a ton, trillions of dollars, waiting to find a home," Palihapitiya said. He pointed to people holding money market accounts and municipal bonds.
"You may see a quick pullback in Q1 [and then] we're back to the races again, because of all this other money that's gonna say, 'I gotta get back in'."
He added: "If you look at all these corrections, in the world of computer-traded algorithms and ETFs and passive money… all the snapbacks are so fast, you correct 20% and then, whoop, you whip it back and you go."
However, the billionaire tech investor said he wasn't sure whether the sell-off was a buying opportunity and that this was just "one view based on the past."
Investors have dumped speculative technology companies as they prepare for the Fed to raise interest rates this year. Companies that are more closely linked to interest rates and the health of the economy, such as financials and retailers, have started to look more attractive.
Palihapitiya, a former Facebook executive who has launched many high profile special-purpose acquisition companies, said it seemed like the Fed has probably waited "a little too long" to start raising interest rates to tackle red-hot inflation.
"We're just, sort of, digesting that reality," he said on his podcast, co-hosted with investors Jason Calacanis, David Sacks and David Friedberg. "I think that… we puked it all out for the most part, in my opinion," he added.
"You have to remember, the big difference between now and even 10… 20, 30, 40, 50 years ago is how many computers are involved in the trade, how much passive money is involved that own assets, and how much of this stuff is sitting on the sidelines still in money market accounts and [municipal bonds]."
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