I listened to Leon Cooperman’s talk at an event hosted by the New York Alternative Investment Roundtable. There were a few members of the media present at the event and they decided that the most interesting part of Cooperman’s talk was his comments regarding the private equity industry. “I think it’s a scam personally” Cooperman said.
“The biggest factor in the success of the private equity in the last decade is the enormous decline in interest rates. That made the exit multiple much higher than the entry multiple. Anybody betting on lower interest rates from here is betting on depression. The odds are very high the interest rates will be going up over the next 5 to 10 years” Cooperman added.
Obviously I didn’t attend this event to report on Cooperman’s private equity comments. I am interested in Cooperman’s market view as well as his best investment ideas. He has been consistently betting on a bull market over the last 10 years and I don’t think he predicted a recession or a bear market at any point over the last 10 years. So, Cooperman is a very reliable recession indicator in my opinion.