Billionaire entrepreneur Mark Cuban told CNBC on Thursday he was worried about valuations across a range of asset classes and has adjusted his investment portfolio accordingly.
“I hedged the heck out of my portfolio,” Cuban said on “Squawk Box.” He said near-zero interest rates from the Federal Reserve have helped lead to “speculation” across various areas, “whether it’s cryptocurrency, whether it’s trading cards, whether it’s non-fungible tokens.”
“When you have such low interest rates, you’re going to get appreciable assets inflating,” said Cuban, who owns the NBA’s Dallas Mavericks and “Shark Tank” investor. “It creates a lot of concern because when interest rates, if and when they go up, and who knows whether it’s years or decades when we’ll see 4%, 5% interest rate again, then people will have different decision criteria.”
Cuban, who made billions of dollars during the dot-com boom, said he was hesitant to describe the current situation in financial markets as “a bubble because it’s reality given the interest rates.”
“But there will be a deflation of some sort in those appreciable assets and it’s going to be scary when that happens,” said Cuban, who sold Broadcast.com to Yahoo in April 1999 for $5.7 billion.
Cuban also commented on the frenzied, short-squeeze trading — led by the Reddit WallStreetBets crowd — that’s sent stocks such as GameStop to dizzying heights in recent weeks.
Despite his fundamental concerns about the stock market, Cuban said he likes what the retail investors are doing enmasse online and sees it as a great equalizer on Wall Street, which has historically been dominated by big institutional investors and hedge funds.
Disclosure: CNBC owns the exclusive off-network cable rights to “Shark Tank,” on which Mark Cuban is a co-host.
