The Anfield outfit struggled in 2011-12 despite massive investment in new players and finished in eighth position, 37 points behind eventual title winner Manchester City.
The Reds have since appointed new manager Brendan Rodgers to replace Kenny Dalglish but, despite the change in coaching, the Miami Heat forward, who signed a deal with Fenway Sports Group in April 2011 to become a minority shareholder, fears that the club will still fail to close the gap in the coming campaign.
"It's a difficult time for the club right now," James told the Daily Mail. "Liverpool are a team in a period of transition at the moment, so I don't know what they can achieve."
The 2008 Olympic gold medal winner, who is currently training with his United States teammates as they prepare for a warmup game against Team GB in Manchester, has expressed his delight that the Games are being held in London and has spoken of his new-found love for football.
"I'm happy London is the host city for these Olympics and the USA team is going to try to go over there and do what they set out to do," he said. "I love football. I love to watch it, read up on it. I fell in love with it after watching it."
And he respects the athletes who play the Beautiful Game.
"I have a new respect for what they do, the shape they're in. It's just like basketball where you have to be a team first of all. If you see some of the plays they make out there, they're kind of basketball plays," he said. "They cut and move, just with their feet. They're passing with their feet while we pass with our hands, to try and set someone up for a goal. We try and do the same thing in basketball, where if someone is open we try and set them up for an easy basket. I definitely love the sport."
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