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Einhorn: "Fed Policy Is A Headwind To The Economy"

Tyler Durden's picture


David Einhorn begins his discussion on the market warning that "certain aspects of the market are very much in bubble,"  with investors "dismissing valuation metrics." "The market is confused," between useful products and real profit streams, he suggests for a number of headline-grabbing higly speculative names. More broadly, Einhorn believes real damage has been done by Fed policy, and is "not convinced if or when they will ever taper." Crucially, he adds, we may see another rollover/recession and "the Fed will pour more fuel on the fire." The cognitive bias he exposes is that most people believe the Fed policy is supporting the economy (in some way), whereas (as we noted here) there are real costs and as Einhorn notes "Fed policy is a headwind to the economy," as he quantifies the hundreds of billions in lost interest income relative to wealth gains. Owning gold makes sense, he adds, "in case they lose control."


"I’m not convinced when — or if they’ll ever taper,” he said. “I don’t know. We may go into the next crisis, the next depression/recession rollover, and the next move might be to pour more fuel on the fire. It wouldn’t surprise me in the slightest.”

Einhorn's broad market thoughts begin at 5:30,


And his gold comments begin at 10:30,

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Thu, 11/21/2013 - 17:58 | 4179032 buzzsaw99
buzzsaw99's picture

sorry, can't look at that cheesy little fuck. want. to. punch. in. nose.

Thu, 11/21/2013 - 18:01 | 4179048 prains
prains's picture

How hard is to explain the McPonzi to a bunch of cup dribblers anyway?

Thu, 11/21/2013 - 18:05 | 4179053 Chris Jusset
Chris Jusset's picture

"Certain aspects of the market are very much in bubble."


Actually, the ENTIRE ECONOMY is in a bubble.

Thu, 11/21/2013 - 18:09 | 4179065 Debeachesand Je...
Debeachesand Jerseyshores's picture

Actually America is in a "Bubble".

Thu, 11/21/2013 - 18:25 | 4179100 James_Cole
James_Cole's picture

 "Fed Policy Is A Headwind To The Economy"

Depends what sort of 'economy' you're talking about.

Thu, 11/21/2013 - 18:41 | 4179152 FL_Conservative
FL_Conservative's picture

"....in case they lose control."    


The Fed lost control after QE1 and the snowball just keeps getting bigger as it rolls down the hill.

Thu, 11/21/2013 - 18:59 | 4179197 El Hosel
El Hosel's picture

"in case they lose control." 

Thu, 11/21/2013 - 18:08 | 4179064 sixsigma cygnus...
sixsigma cygnusatratus's picture

I want to sell my FB stock.  I need to get at least $200/share cause that's how much I borrowed against it to buy TSLA stock.

Thu, 11/21/2013 - 18:29 | 4179116 prains
prains's picture

....you won't need a lighter, just have the meat ready when it goes

Thu, 11/21/2013 - 18:10 | 4179067 xamax
xamax's picture

we believe s&p500 can hit 2000 before end of year.

Thu, 11/21/2013 - 18:19 | 4179086 max2205
max2205's picture

5 years ago...If you had 100k in savings or cd the fed stoled over $ $25k in interest at 5%....it went to Jamie and the boyszzz

Thu, 11/21/2013 - 18:24 | 4179096 kaiserhoff
kaiserhoff's picture

Even someone named Einhorn is Jewish.

Not that there's a trend or anything.

Thu, 11/21/2013 - 18:37 | 4179142 bubblemania
bubblemania's picture

There are no bubbles, there is only Yellank.

Thu, 11/21/2013 - 18:40 | 4179150 Seal
Seal's picture

QE was never designed to “help” the economy – it was/is to help the banks at the taxpayer’s expense. 

Thu, 11/21/2013 - 18:47 | 4179172 SpykerSpeed
SpykerSpeed's picture

"I don't know about Bitcoin."

Good.  Don't research it.  It's just a ponzi scheme.  Tulips.  Internet drug tokens backed by nothing.  :)

Thu, 11/21/2013 - 18:56 | 4179194 RaceToTheBottom
RaceToTheBottom's picture

Use Tide instead

Thu, 11/21/2013 - 19:18 | 4179248 zipit
zipit's picture

You will buy some BTC

Thu, 11/21/2013 - 19:11 | 4179229 ForTheWorld
ForTheWorld's picture

Finkle and Einhorn... Einhorn and Finkle...


Thu, 11/21/2013 - 19:13 | 4179235 lailapa
lailapa's picture

Global Debt Crisis - The greatest private fraud of human history.

Who are the great fraudsters who are becoming the murderers of the human kind?

How does the economy "illness" threaten Democracy and the freedom of people?


Thu, 11/21/2013 - 19:50 | 4179329 blindman
blindman's picture

john trudell from 1980,
First Voices Indigenous Radio
minute 10.
Thursday November 21 9:00am
John Trudell: We are power


Thu, 11/21/2013 - 21:19 | 4179612 ImReady
ImReady's picture

That's some powerful shit right there. The American middle class are the indians of today. 

Thu, 11/21/2013 - 20:07 | 4179377 silverserfer
silverserfer's picture

headwind? shit. more like a tailwind with your face behind the bernanks ass after a night of pf changs and vodka. 

Fri, 11/22/2013 - 00:38 | 4180185 Shizzmoney
Shizzmoney's picture

This guy picked Taco Bell over Chipotle #lol

He's right about the Fed......but you don't have to be a billionaire to know that they are just arrogant academics who don't know what they are fucking doing.

Fri, 11/22/2013 - 09:50 | 4180794 timbo_em
timbo_em's picture

Classic CNBC: Einhorn talks about gold and that he bought it in 2008 and CNBC shows an intra day chart of gold

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