(Noted News) — The founder of one of the biggest online media conglomerates is sounding the alarm on the current state of the stock market and American economy, urging people to “stay home” and save cash.
Barry Diller, former CEO of Fox Broadcasting Company and founder of InterActive Corp, said that the stock market is being driven by “great speculation” and that people are better off saving cash instead of trying to jump into the stock market.
“Well personally and professionally, [save] every nickel you can, keep it wherever it’s banked. Now is the time.”
Diller noted that despite his sentiments, he did just invest over $1 billion into casino giant MGM Resorts, but that this was a unique situation that the COVID-19 crisis gave them.
“The crisis allowed us to do what we thought was extremely money-good, meaning we would never lose our capital in it. But because of this moment…we got the ability to invest in something like that. But generally, I think for any speculation—and I think the market right now is a great speculation—I would stay home.”
Diller also mentioned the increasingly divisive election as a factor that makes any sort of logic-based investing too risky.
“We’ve got the anvil of this election over our heads. Each day from now until November is going to get more and more concerning, and more and more divisive, and more and more difficult,” Diller added.
The billionaire does not see any long-term differences business-wise between a Democrat administration and a Republican administration, he just sees an initial bout of unpredictable volatility making strategic investment impossible until “late November”.
“I think in the early days of a Biden administration, I think there’s going to be definitely a down-draft just on expectations of taxes rising and things like that, but I don’t think long term—as far as business is concerned—I don’t think long term there’s going to be any particular difference.”
Pouring $1 billion into MGM Resorts was not Diller’s only big move during the COVID-19 crisis. Expedia, his second-largest business next to IAC, lost 95% of its value during the crisis, prompting Diller to raise “$6-$8 billion” to survive the long-term effects of the new normal.
Diller originally thought that the travel industry would begin its revival around June 2021, but now believes it will take a little longer. According to Diller, in the travel industry, “everything substantially will return.”