Whitney Tilson says he doesn’t think the U.S. is headed for financial Armageddon, which means numerous bargains — including several in the financial sector — are available right now.

“Yes and no,” Tilson says when asked by Forbes’ Steve Forbes if there are more bargains in the market than there were in 2008. “In terms of just pure, crazy cheap 20 cent dollars out there, it’s nothing like late 2008, early 2009. On the other hand, the world then was on the edge of Armageddon. … Things were cheaper then, but you were taking much greater risk. Today, if you were to argue on a risk-adjusted basis, we’re finding some stocks that are pretty close to as cheap as then. And we don’t think we’re anything near Armageddon, though there certainly is a scenario that one can concoct.”

Tilson says he’s particularly interested in the financial sector, where large-cap U.S. financials are “pretty cheap”. Companies like Citigroup and Goldman Sachs are massively less leveraged than they were in 2008, but are trading at valuations not much higher than they were back then, he says.

Tilson also talks about why he thinks many investors continue to buy long-term Treasury bonds despite historically low yields, and why he thinks investors are better off looking elsewhere. “I think short of a severe Japan-style deflation — which there’s maybe a 5% or 10% chance of that over the next ten years — you’re overwhelmingly likely to do better in carefully chosen blue-chip equities with a nice dividend yield, where you’re not paying too high a multiple for it,” he says.

This year has been a tough one for Tilson’s firm, though he has a strong long-term track record. His advice for how to deal with such rough periods: “The key, actually, when you’re in a hole, is you have to mentally pretend that you’re flat on the year and that your portfolio’s 100% cash. What would you do? Because what really gets you into trouble is when you’re in a hole and it’s so painful and your investors are mad at you and so forth, that you swing for the fences and you start taking on leverage and buying riskier securities in an attempt to quickly get back out of that hole.”