Blackstone's COO Thinks A Market Correction Is Coming

• Blackstone Group LP BX's President and COO Tony James said that a market correction is "coming."
• Speaking to CNBC, James highlighted many ongoing concerns, including the threat of terrorism, to justify the equity market taking a "pause."
• Blackstone's Head of Private Equity, David Calhoun, noted that "difficult" moments provide opportunities for private companies in his portfolio.

Is a market correction coming? According to Tony James, President and COO Blackstone, the alternative asset managing powerhouse, the answer is yes.

"I think the markets are pretty fully valued here," James told CNBC. "While the economies are strong, I think there is some headwinds and values are ahead of themselves."

James sees "a bit of a correction coming" due to multiple factors, including ongoing terrorist threats and events, an inevitable near-term transition to higher interest rates, a weaker Chinese economy, economic woes in South America, and S&P 500 companies reporting "flat at best" earnings.

James argued that stock prices are "due to a pause" given his long list of bearish items. He also added that it is difficult to find "good news that is not already reflected in the stock market."

David Calhoun, Blackstone's Senior Managing Direct and Head of Private Equity Portfolio Operations, was also a guest on CNBC's segment. He offered a somewhat contrarian view and stated that while stocks could go through a correction, investments in private companies offers some advantages.

"In some ways, difficult moments, for me, are the best," Calhoun said. "That's the moment you can predict what your public counterparts going to do and you get to do it different, better, harder, and faster."