Appaloosa Management founder David Tepper was on Bloomberg TV Wednesday morning, and host Stephanie Ruhle got him talking about the hedge fund blood bath of the day — Fannie Mae and Freddie Mac.
Shares in the two insurers plummeted up to 40% after a Court decided against a group of hedge fund managers suing for the rights to Fannie and Freddie profits.
Since the financial crisis, the U.S. Treasury has taken virtually all of that cash, and now investors like Bill Ackman, Bruce Berkowitz, and Richard Perry want a piece.
There are 20 more cases pending about this issue, but losing this first case doesn’t bode well for the rest.
Tepper told Bloomberg that he wished he didn’t own any of the stock, but they weren’t a large position for his fund.
Either way, he pointed out that investors can appeal the decision if they like — so there’s that.