Palihapitiya says cash in financial savings will probably be ‘rocket gasoline’ for property like housing and shares

Chamath Palihapitiya speaks at the Delivering Alpha 2017 conference in New York on September 12, 2017.

David A. Grogan | CNBC

Consumers have been sitting at home for months and months, and with no typical things to spend money on, bank account wealth is growing. And that’s a positive sign for stocks, according to Chamath Palihapitiya, CEO of Social Capital.

He said the combination of consumer savings and money in the money markets jumping to all-time highs will act as “rocket fuel” for assets.

“Whether it’s real estate markets, or whether it’s capital buying like cars or vacations or stocks in this case, if we’re still under wraps these things will only go to the moon for a while,” he said on CNBCs Thursday “Mid-term report”.

“You just have to be long. Anyone who tries to understand why you shouldn’t be long will, I think, regret it for at least the next 18 to 24 months.”

His comments came as key averages rose to new highs on Thursday after advancing as well despite the turmoil in Washington on Wednesday. Investors hope that a democratically controlled Congress will lead to more incentive payments for consumers.

Palihapitiya said investors with stocks at record highs shouldn’t just drop the names that worked. His comments related specifically to his position in Tesla.

Despite the stock’s 750% surge over the past year, Palihapitiya believes stocks could double or even triple.

“I don’t understand why people are so focused on selling things that work,” he said. “When things work, you get paid to stay with people who know what they’re doing. That’s a guy [Elon Musk] Who was consistently one of the most important entrepreneurs in the world. So why bet against him? “, He said.

Palihapitiya also weighed on Bitcoin’s record run when the cryptocurrency topped $ 40,000 for the first time on Thursday.

“There will probably be $ 100,000, then $ 150,000, then $ 200,000,” Palihapitiya told CNBC. “What time? I don’t know. [Maybe] five or ten years, but it’s going there. “

On Thursday, the online financial start-up SoFi announced that it would go public through the merger with a blank check company led by Palihapitiya.

– CNBC’s Fred Imbert contributed to the coverage.

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