David Tepper, the famous manager of hedge fund Appaloosa is on CNBC this morning.
Tepper is well known for his big bullish bet on financials during the bottom of the crisis, betting on government intervention.
We’ll let you know as he makes notable comments.
- Talking about performance — and the difficulty of maintaining track record — Tepper claims a 40% annualized return for himself over the years.
- Tepper doesn’t use leverage in his funds.
- How he knew to bet on financials during the crisis (his most famous bet): The government told you what it was going to do. The Treasury put out a white paper saying exactly that it was going to bail out the big banks, but nobody believed the government, and he did, thinking the government wasn’t “above the law” (able to renege on what it said it would do).
- What does he see now? The Fed just announced “we want economic growth, and we don’t care if there’s inflation… have they ever said that before?”
- What’s going to do well? EVERYTHING: stocks, bonds, gold etc. Stocks can’t go down that much, because the Fed is issuing a put. “You’ve gotta love a put.” (See more on the “Fed put” here.)
- Tepper says he’s been adding to equity investments lately.
- “We’re not Japan.” If your mortgage is at 5%, and you can refinance lower to 4%, then you’re going to spend more money.
- Not that big into financials these days.
- Question to Tepper: Are people still interested in stocks? Tepper turns it around: How are CNBC ratings? Kernen: They’re going down with market volume.
- Tepper’s worst-ever trade? Russia.
- Does Tepper get worked up about week-to-week macro numbers, like the (strong) durable goods number that just came out? Not really. Though he does not the trend.
- On gold, he doesn’t own it, but says he can see why others might, and doesn’t think it will go down much.
- On the carried interest tax, he’s indifferent it sems.
- And that’s it. A very good interview, refreshingly free of jargon and wishy-washy meaninglessness.