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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buzzsaw99's picture

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

prains's picture

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

Chris Jusset's picture

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

 

Actually, the ENTIRE ECONOMY is in a bubble.

Debeachesand Jerseyshores's picture

Actually America is in a "Bubble".

James_Cole's picture

 "Fed Policy Is A Headwind To The Economy"

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

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.

El Hosel's picture

"in case they lose control." 

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.

prains's picture

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

xamax's picture

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

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

kaiserhoff's picture

Even someone named Einhorn is Jewish.

Not that there's a trend or anything.

bubblemania's picture

There are no bubbles, there is only Yellank.

Seal's picture

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

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.  :)

ForTheWorld's picture

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

THE LACES WERE IN!

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?

http://eamb-ydrohoos.blogspot.gr/2012/01/global-debt-crisis.html

blindman's picture

john trudell from 1980,
First Voices Indigenous Radio
minute 10.
.http://archive.wbai.org/#ankor3
Thursday November 21 9:00am
.
.
John Trudell: We are power

http://www.youtube.com/watch?v=WNr4Lw4XBHU

ImReady's picture

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

silverserfer's picture

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

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.

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