Hedge fund manager Doug Kass, president of Seabreeze Partners, has been negative on stocks all year, and he's not abandoning that view now.
"Combine the likelihood that we're at the upper range for price-earnings (P/E) multiples, we have political issues that are profoundly important and we have some deterioration in the technicals," and you have three reasons why stocks should fall, he tells CNBC.
As for P/E multiples, earnings forecasts haven't risen, Kass explains. "What's happened is that valuations have gone up from 14 times at the beginning of the year to over 16 times now."
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And he doesn't believe that can continue.
When it comes to politics, there's plenty on the agenda for September and October, Kass argues. "It includes the debt ceiling, government spending, immigration, tax, GSE [Fannie Mae and Freddie Mac] reforms and, of course, what the Fed is going to do."
In terms of technicals, "the bull market is long in the tooth," Kass maintains. "We're almost 54 months from the generational low in March of 2009. And if we look over the last 60 years, the average bull market has been only about 43 months."
Not everyone is pessimistic about stocks. Goldman Sachs predicts the Standard & Poor's 500 Index will rise 7.7 percent in the next year to 1,825 amid accelerating U.S. economic growth, Bloomberg reports.
"The real issue to focus on is that rising interest rates are a reflection of a better economy," David Kostin, Goldman's chief U.S. equity strategist, tells Bloomberg TV.
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