Tepper Says Fed Backs His Stock Bullishness

Sep 27 2010 | 12:43pm ET

Appaloosa Management’s David Tepper offered a full-throated endorsement of the stock market on Friday, explaining that his extreme bullishness is fueled by the Federal Reserve.

The hedge fund billionaire, whose flagship rose 132% last year, told CNBC that last week’s Fed Open Market Committee statement amounts to a “put” on the stock market; the central bank will do whatever is necessary to prop up stocks, Tepper said.

“Either the economy is going to get better by itself in the next three months—what are assets are going to do well? Stocks are going to do well, bonds won’t do so well, gold won’t do as well,” Tepper said. “Or the economy is not going to pick up in the next three months and the Fed is going to come in with” quantitative easing, which Tepper said would boost everything but bonds.

The Appaloosa chief likened the situation to last year, when Appaloosa made a killing on bank stocks.

“It was easy,” he said. “The government told you what they were going to do.”

Tepper offered further congratulations to himself in an interview with New York magazine.

“It was like that scene in ‘Trading Places’ with the orange-juice futures,” he said early this summer. “The whole market and the whole world were in pure panic. Everyone was too scared to do anything.”

Everyone except him, of course.


In Depth

'Smart Beta' Funds In Regulators' Sights, Hedgies May Be Next

Mar 26 2015 | 11:11am ET

Funds that mimic strategies used by active managers for a fraction of the cost could...

Lifestyle

Study: Both Marriage and Divorce Lead to Negative Hedge Fund Performance

Mar 25 2015 | 6:51pm ET

Trouble at home leads to trouble in the market for fund managers, according to researchers...

Guest Contributor

Concerned About Your HFT Exposure? Hedge It!

Mar 26 2015 | 1:06pm ET

High-frequency trading has been a persistent storyline for several years. The trading...

 

Sponsored Content

    Mar 9 2015 | 6:35am ET

    Kelly RodriquesKelly RodriquesAs more investors look to diversify, many are beginning to use retirement funds to invest in alternative assets such as private equity and real estate. Kelly Rodriques, CEO & President of PENSCO Trust Company, explains how companies can connect with those looking to use their retirement accounts in a different way. Read more…

Editor's Note