Lee, who is usually identified for his bullish forecasts and assist of cryptocurrencies, says that shares will proceed their march greater. Regardless of greater than a yr of constant recession predictions from Wall Road (in all probability amounting to essentially the most broadly predicted recession in historical past), he notes that the financial system has remained resilient, with the unemployment price hovering close to pre-pandemic lows and GDP development persevering with within the first quarter.

“I feel as a substitute of a recession unfolding, the financial system is definitely slipping into an growth,” Wall Road’s largest bull instructed CNBC Monday.

Right here’s what Lee is seeing that everyone else could be lacking.

“Circumstances for income to really outperform”

Funding banks have repeatedly warned that the Federal Reserve’s speedy rate of interest hikes will ultimately gradual the financial system sufficient to spark a recession, with some high strategists predicting that company earnings will fall all through the rest of the yr and crush inventory costs. However Lee pointed to falling commodity costs, therapeutic provide chains, and the robust labor market as proof that the financial system—and company America—could also be in higher well being than many think about. 

“I feel these are situations for income to really outperform, and at a time when buyers’ positioning has been so offsides,” he mentioned, noting that buyers have been “very cautious” to speculate this yr amid constant recession predictions. 

Lee has seen a few of Wall Road’s recession fears flip to FOMO (fears of lacking out) in latest weeks, which may improve flows into the inventory market. And whereas many analysts have cautioned that this yr’s inventory market rally has primarily been led by a number of tech giants, the Fundstrat cofounder doesn’t see that as a unfavorable.

“I don’t suppose shares are overextended. I feel the FANGs did the heavy lifting [in this year’s rally],” he mentioned, referring to the well-known Fb-Apple-Netflix-Google tech basket, “and if we’re slipping into an growth, a number of different names are going to take part.”

Lee isn’t completely alone in his bullish view. Jay Hatfield, Infrastructure Capital Administration’s CEO, instructed Fortune that he believes inflation will fall to only 3.1% in June, enabling the Fed to finish the speed mountain climbing marketing campaign that has weighed on shares later this yr.

“We imagine that the Fed can be pressured to capitulate on their ‘entrenched’ idea of inflation, simply as they capitulated on their ‘transitory’ idea, because the year-over-year information affirm that inflation is plunging,” he mentioned.

Hatfield now sees the S&P ending the yr in a variety between 4500 and 5000, as inflation fades and “an A.I. growth continues to gasoline the inventory market and will increase financial exercise.”

For Tom Lee, the one factor that might quash the market’s rally this yr is an aggressive Fed, which, as some economists instructed Fortune earlier at present, isn’t glad that it has absolutely licked inflation but. However Lee doesn’t see that taking place.

“I feel this stage of inflation goes to begin to look extra acceptable to the market and to the Fed,” he mentioned. “After which the query is, ‘Is the Fed okay with the place shares are’? And I feel they’re.”