Friday, 1 July 2016
Last updated 14 hours ago
Oct 16 2013 | 11:55am ET
The Federal Reserve's quantitative easing program is here to stay—and at its current, $85-billion-per-month level, according to David Tepper.
The Appaloosa Management chief said that, given the political gridlock in Washington that has a U.S. government shutdown on its third week and with the possibility of a default, there is "no way" the Fed will begin to cut its bond-buying. The long-await taper—widely expected to have begun last month—won't come for "a long time now," he said.
"They really have no choice," Tepper told CNBC.
"When are you going to have the momentum in the economy to start it, and it is certainly not now," Tepper said. "It's probably not going to be for the next three or four months because you have this overhang again."
That would mean the taper would fall to Fed chairman-designate Janet Yellen, who is expected to succeed Ben Bernanke in January. The Fed meets three more times before his term expires.
Tepper, whose fund is up more than 20% this year, also expressed confidence that there would be no default tomorrow, despite the warnings from the U.S. Treasury.
"We really won't default on the 17th," he said.