Get ready for a repeat of last year's slump in stocks, as investors wake up to the mounting risks in markets today, David Rosenberg has warned.

The Rosenberg Research president pointed to deflation in China, the prospect of higher borrowing costs for the US government after Fitch downgraded the country's credit rating, and a looming credit crunch after Moody's cut the credit ratings of several US regional banks. He also singled out the resumption of student-loan payments in September as a likely drag on young Americans' future spending.

"The stock market simply does not understand, or more charitably does not appreciate," those headwinds, Rosenberg said in a video uploaded to his firm's YouTube channel on Tuesday.

"It would be one thing if the S&P 500 was priced for these imperfections, but instead it is priced for perfection," the former chief North American economist at Merrill Lynch added.

Rosenberg explained that the equity-risk premium, or the projected difference in returns from stocks versus safe assets like government bonds, has tumbled to two-decade lows. Moreover, S&P 500 companies' valuations are in the top 9% of expensiveness in the index's history, he said.

The veteran economist noted his firm's Strategizer tool, which models future returns for different assets and markets, is now showing its lowest score for the S&P 500 since January 2022. He pointed out that the benchmark index slumped nearly 30% during the next nine months last year, as price-to-earnings multiples receded toward historical averages.

"We should expect a déjà vu, especially with interest rates so much higher than they were back then," Rosenberg said.

Investors should avoid the "uber-expensive" US stock market, and instead buy "undervalued and deeply shorted" US Treasuries, Rosenberg argued. He also touted stocks in Canada and Asia — excluding China given the geopolitical risks of parking money there now — as well as gold, a traditional haven asset.

Rosenberg has been pounding the alarm on stocks and economic risks for a while. In a recent research note, he compared the current hype around stocks to the mania that preceded the Great Crash of 1929, the dot-com bubble's implosion in the early 2000s, and the housing market's collapse in 2008.

Moreover, he warned that American consumers are burning through their savings and racking up credit-card debt as they weather historic inflation and sharply higher interest rates. They're now "at the end of the rope," paving the way for a painful recession, he said.