Satori's Dan Niles: S&P 500 will fall in 2022, likes Google, Facebook and cash

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• Widely followed hedge fund manager Dan Niles predicted Wednesday that the S&P 500 will decline in 2022, as the Federal Reserve is forced to raise interest rates and stock valuations come further off of all-time highs.
• "My favorite investment idea right now is cash," the founder and portfolio manager at Satori Fund told CNBC.
• In terms of individual stock picks, Niles pointed to Google's parent company Alphabet (NASDAQ:GOOG)(NASDAQ:GOOGL) and Facebook's parent Meta Platforms (NASDAQ:FB), which he says provide growth at a reasonable price.
• "Those are great names. The names you want to be scared about are the ones that have no earnings and are valued off of revenues," he said. "Those are the stocks that are going to have huge troubles as rates continue to ratchet up."
• Niles argued that signs of weakness have been popping up in the equity markets for the past several weeks, with indexes like the Russel 2000 falling dramatically over that span.
• "Underneath the surface, there's a lot of damage being done and people are just continuing to crowd into some of the biggest names," he said.
• Detailing his prediction for 2022, Niles projected that the Fed will be forced to raise rates to counteract inflationary pressures. This, in turn, will push stocks off of lofty valuation levels, which reached a peak above figures seen during the dot-com bubble of the late 1990s and early 2000s.
• Meanwhile, for the end of the year, Niles contended that most fund managers are "either window dressing or tax-loss selling," which means that value stocks will have trouble finding support during December.
• Niles has long supported FB and GOOGL. See what tech giant he previously labeled "the most overpriced tech stock."