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David Tepper: Bill Gross "Who Cares?", Regrets FNMA, Economy "Good", Stocks Not Expensive

Tyler Durden's picture




 

He's back. A month after Appaloosa's David Tepper explained the end of the bond bull market was here (and 10Y rates are now 5bps lower), the trend-following master-of-the-universe explained to Bloomberg TV's Stephanie Ruhle and Erik Schatzker how the departure of Bill Gross from PIMCO was "nothing... who cares?"; why "the US economy is pretty good", how junk bonds are at "fair value" and stocks are cheap as "multiples are not high." Finally he explains how he "wished he didn't have any investment" in Fannie Mae and Freddie Mac and clarifies in his billionaire-all-knowing-ness how he is sure the United States can contain Ebola.

 

Headlines:

  • *APPALOOSA'S TEPPER COMMENTS ON ECB ACTIONS IMPACTING BONDS
  • *TEPPER SAYS DRAGHI HASN'T DONE ANYTHING YET
  • *TEPPER SAYS DRAGHI HAS TO STOP THE NONSENSE
  • *TEPPER SAYS BILL GROSS EXIT MEANS NOTHING FOR MARKETS
  • *TEPPER SAYS BILL GROSS EXIT LONG-TERM NOT RELEVANT
  • *TEPPER SAYS U.S. EQUITIES INTERESTING ON MULTIPLES BASIS
  • *TEPPER SAYS U.S. ECONOMY PRETTY GOOD, STOCKS NOT HIGH MULTIPLES
  • *TEPPER SAYS HIGH YIELD IS AT MID-POINT OF FAIR VALUE
  • *TEPPER SAYS HE WISHES HE DIDN'T HAVE FANNIE, FREDDIE INVESTMENT
  • *TEPPER SAYS APPEAL FOR FANNIE, FREDDIE POSSIBLE

Full clip:

 

Excerpted Transcript:

On Bill Gross:

RUHLE: What does this Bill Gross exit mean for the market?

 

TEPPER: Nothing. Who cares?

On Draghi:

TEPPER: They haven't done any QE yet. So let them start some QE. But the beginning of the end was basically saying that when you create inflation and some inflation in the eurozone, then the bond market is going to start going down. If you don't create inflation in the eurozone of some sort or you don't stop the deflation, then that might not happen. But I do think that if they go in action, if they get in action, if they really get in action you will start creating inflation at some point in time. Until you do that, things will go where they go. And you can look at the curves over there.

 

TEPPER: Yeah, I think that's probably right to a certain extent. I don't think you want to fight it, but you've got to understand what it's going to mean. So the extent that if he's really in action then you don't want to fight him, but he has to really get in action. You have to start QE. This negative interest rates doesn't necessarily have the effect of creating money. It doesn't necessarily have the effect of creating inflation. So if you want to do that, do that. But right now he's done nothing. So let him start.

On Stock Valuations:

TEPPER: Look, the US economy's pretty good. That's all. But with the stock markets, I think that you really aren't at – at high multiples right now.

 

TEPPER: Well I don't think it's high because if you – if you believe interest rates are 4 or 4.5 percent, 16.5 seems like about the right multiple. But I don't think we're at the 4.5 percent 10-years. We're at 2.5 percent 10-years or unfortunately 2.43 or something like that right now. And next year at 14

On Bonds:

One big employment print and you will go down to – these yields here will come down in the US, okay?

 

However, you’re so close to go the other way.

 

That's what makes this a very tricky market. So if you have – listen, if you have big employment numbers that take you into the 5s, it's going to start worrying the Fed about labor push (ph) inflation at some point. And if you do get inflation in Europe to start – stop going down, inflation to stop going down or deflation looks like it'll start taking over, at the same time you'll have the market's yields turn up here. So it's tricky. And until that happens, you could have pressure on yields down.

 

So the question is is there enough – are you getting paid enough for the risks in any kind of place in the yields? Because there's a lot of chances to lose money.

On US Equities:

TEPPER: Well I kind of told you. Listen, it's – it's interesting on a multiple basis and – but you have to have certain things happening. You’ve got to have Europe stop – stop the nonsense, so to speak, Draghi stop the nonsense. So that's kind of it.

On Warren Buffett:

TEPPER: Warren Buffett? He's an interesting guy. I'll say that.

On Ebola:

TEPPER: I think the United States, if any country can contain the risk, the United States can contain the risk.

*  *  *

SCHATZKER: Summing Up: the high-yield market in the mid-point of fair value. The bond bubble if Draghi undertakes QE is going to blow up. Equities okay with next year's earnings.

 

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Wed, 10/01/2014 - 17:02 | 5277115 Bell's 2 hearted
Bell's 2 hearted's picture

a billionaire, eh?

 

i wonder if these guys EVER talk to anyone outside of the top 10% (other than to say "you missed a spot")

 

no wonder they are so clueless

Wed, 10/01/2014 - 17:18 | 5277171 junction
junction's picture

Tepper is putting on a dumb act to throw off his wife's divorce lawyer.  The stock market's gyrations are the result of Tepper and his ilk unloading their stock portfolios piecemeal and converting the funds into hard assets, such as in real estate here and abroad in fully owned shell corporations and physical precious metals like palladium, rhodium and gold. 

Wed, 10/01/2014 - 17:20 | 5277180 Newsboy
Newsboy's picture

Translation: "Keep buying a little longer, while I get out."

Wed, 10/01/2014 - 20:23 | 5277777 khakuda
khakuda's picture

Exactly.  He just needed to wait until the day after the September 30th close so the filing could show him invested. Wait until the 12/30 filing when we find out he is gone...probably starting today.

Wed, 10/01/2014 - 21:10 | 5277915 Lets Buy The Dip
Lets Buy The Dip's picture

Big trader took the put call spread today a whopping $2 Million dollar trade! HOLY HELL!

He thinks this ebola shitty crisis is over. Take a look. 

You can see here ==> http://bit.ly/1B4K0wk

 

Thu, 10/02/2014 - 12:21 | 5280470 redman38
redman38's picture

your right

 

Wed, 10/01/2014 - 18:02 | 5277310 Eireann go Brach
Eireann go Brach's picture

Fugly motherfucker!

Wed, 10/01/2014 - 22:58 | 5278351 SAT 800
SAT 800's picture

Appaloosa's David Tepper? Which end of the horse does he play?

Wed, 10/01/2014 - 17:04 | 5277117 y3maxx
y3maxx's picture
  1. ...That's not Tepper being interviewed....It's Obama wearing a Tepper Halloween Mask.
Wed, 10/01/2014 - 17:03 | 5277119 Jumbotron
Jumbotron's picture

On a long enough timeline Tepper.......you can't escape.  But why wait.....

Wed, 10/01/2014 - 17:03 | 5277122 xtop23
xtop23's picture

Ok thanks Tep....... ya freakin' quackappotamus.

Sell crazy somewhere else, we're all stocked up here.

Wed, 10/01/2014 - 17:12 | 5277152 Stoploss
Stoploss's picture
  • * TEPPER SAYS EBOLA HEALTHY
Wed, 10/01/2014 - 17:05 | 5277124 q99x2
q99x2's picture

Wash your Tepper before you catch the ebola.

Wed, 10/01/2014 - 17:05 | 5277125 chunga
chunga's picture

Bill Gross is a Presbytarian.

Wed, 10/01/2014 - 17:06 | 5277126 Cangaroo.TNT
Cangaroo.TNT's picture

Now I know why I'm not a billionaire.  I don't stutter, stammer, and say "listen" a lot like some patronizing douche.

Wed, 10/01/2014 - 17:07 | 5277138 xtop23
xtop23's picture

The word you're looking for is, "pontificate" or "pontificating."

...... and yes, he's a douche :)

Wed, 10/01/2014 - 17:16 | 5277164 Headbanger
Headbanger's picture

And here I thought it was my lack of sobriety..

 

Wed, 10/01/2014 - 17:55 | 5277281 Agent P
Agent P's picture

That, and a billion dollars.

Wed, 10/01/2014 - 17:05 | 5277130 Squid Viscous
Squid Viscous's picture

what a piece of shit ... hope I run into him in the bagel shop

Wed, 10/01/2014 - 17:19 | 5277176 eclectic syncretist
eclectic syncretist's picture

Wow!  The billionaire dude is going to take time out of his busy schedule to help me.  I better do everything he recommends.

Wed, 10/01/2014 - 17:06 | 5277132 Bell's 2 hearted
Bell's 2 hearted's picture

– listen, if you have big employment numbers that take you into the 5s, it's going to start worrying the Fed about labor push (ph) inflation at some point.

 

wow.

 

there is better chance of the Dallas Cowboy cheerleaders showing up on my doorstep tonight ... naked ... than this occurring

 

clueless

Wed, 10/01/2014 - 17:31 | 5277204 Pool Shark
Pool Shark's picture

 

 

Wage Push Inflation?????!!!!!!!

 

HAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHA!!!!

[takes breath...]

HAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHA!!!!

[takes breath while rolling on floor...]

HAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHA!!!!

[passes out from hypoxia...]

 

Wed, 10/01/2014 - 17:37 | 5277215 Babaloo
Babaloo's picture

Seeing as how the UE rate is at 6.1%, I better get your address cuz I think you're gonna need some help with those cheerleaders!

Wed, 10/01/2014 - 17:07 | 5277134 assistedliving
assistedliving's picture

thus spoke Zarathustra...

Wed, 10/01/2014 - 17:06 | 5277136 heywood2
heywood2's picture

Ebola is a non-issue in the US.

 

Wed, 10/01/2014 - 17:11 | 5277148 Bell's 2 hearted
Bell's 2 hearted's picture

needs a catchier moniker ...

 

 

Wed, 10/01/2014 - 17:20 | 5277182 eclectic syncretist
eclectic syncretist's picture

Subprime is contained, and so is ebola.

Wed, 10/01/2014 - 17:29 | 5277199 negative rates
negative rates's picture

Add climate change and you have a hat trick.

Wed, 10/01/2014 - 17:15 | 5277160 yogibear
yogibear's picture

Ebola is not an issue until it is. Just wait and see. Already more people are infected. The incubation period is long enough to fool most.

Where there is one there are many more. Wait until the deaths occur from it. It's when it hits home and rattles people.

Wed, 10/01/2014 - 17:23 | 5277188 Everybodys All ...
Everybodys All American's picture

So many people/doctors trying to downplay it now. I just ask one simple question. Why the hazmat suits then?

Wed, 10/01/2014 - 17:31 | 5277206 negative rates
negative rates's picture

This is just a test, no need to worry unless your are the taxpayer and didn't get your suit.

Wed, 10/01/2014 - 17:13 | 5277150 buzzsaw99
buzzsaw99's picture

just another maggot

Wed, 10/01/2014 - 17:13 | 5277151 markar
markar's picture

the guy even looks like a dickhead

Wed, 10/01/2014 - 17:18 | 5277173 Jack Sheet
Jack Sheet's picture

If this guy is a multEYE billionaire, what is one of his farts worth?

Wed, 10/01/2014 - 17:20 | 5277184 Everybodys All ...
Everybodys All American's picture

You think he's bullish wait until you hear the oracle of Omaha tomorrow. You can count on his bs like the sun coming up.

Wed, 10/01/2014 - 17:26 | 5277193 Jackagain
Jackagain's picture

Bill Gross Exposes $42 Trillion Bond Market’s Key Flaw in Exit

http://finance.yahoo.com/news/gross-exposes-42-trillion-bond-151215054.html

Wed, 10/01/2014 - 17:25 | 5277194 JustObserving
JustObserving's picture
U.S. airlines scramble after HUNDREDS of passengers U.S. Ebola patient had contact with on the THREE legs of his journey from Liberia to Dallas
  • Thomas Eric Duncan flew from Liberia to Brussels, then took a connecting flight before hopping on a plane to Dallas
  • U.S. officials claim there is no risk to Duncan's fellow passengers, however they are REFUSING to release the details of the flights he took 
  • Airlines say they are consulting with the U.S. officials on how to deal with Ebola outbreak
  • http://www.dailymail.co.uk/news/article-2776786/U-S-airlines-contact-gov...
Wed, 10/01/2014 - 17:28 | 5277197 Eahudimac
Eahudimac's picture

As soon as I read this article and what Tupper was saying, I thought to myself "zionist douche". Sure enough:

  1. Tepper was raised in a Jewish family in the East End of Pittsburgh, Pennsylvania in the Stanton Heights neighborhood (Carnegie Mellon Tepper School of Business: "Meet the Man Behind the Gift" November 17, 2004)
  2. In 2006, Tepper donated $1 million to United Jewish Communities of MetroWest New Jersey toward their Israel Emergency Campaign (New Jersey Jewish News: "Seven-figure donation fuels emergency campaign: September 7, 2006)

Only a zionist douche would spew such bullshit at this time. He needs to keep the illusion going for his own sake. Sure, nowhere does he say he is a zionist, but none of them say it publically. His bullshit speaks for itself.

David Tepper - just another zionist douche.

Wed, 10/01/2014 - 17:35 | 5277217 robnume
robnume's picture

David Tepper: Get the Fuck Off of My Planet, Fidouchebag!

Wed, 10/01/2014 - 17:45 | 5277257 Dr. Engali
Dr. Engali's picture

Everytime I hear the word "contained" I know something bad is about to happen.

BTW. Bill Gross leaving, as whacked out as he is, is a big deal.

Wed, 10/01/2014 - 17:46 | 5277260 huggy_in_london
huggy_in_london's picture

Listen, listen... let ME tell you, because I am a billionaire and unless you are a billionaire you must be stupid.... 

Quite an objectionable fellow......

Listen.....

This guy thinks he's an expert at everything.... arrogant fool.  Listen, listen... "bill gross - who cares, buffett - interesting...listen my ego needs stroking ... me, me, me, me"

His discussion about europe and the ecb tells you he knows NOTHING about how the ecb works and what they can actually (legally) do.  

Listen....

As for the other guy... sycophantic knob.

Wed, 10/01/2014 - 18:50 | 5277491 LooseLee
LooseLee's picture

Prerequisite to being a PINKO COMMIE FASCIST POS, no doubt....

Wed, 10/01/2014 - 17:46 | 5277265 Spungo
Wed, 10/01/2014 - 17:56 | 5277287 Downtoolong
Downtoolong's picture

Tepper is a salesman,

and that is all he is.

Too bad he didn’t find a way to use his oversized cranium to develop something other than an oversized ego to store in it.

Wed, 10/01/2014 - 17:58 | 5277293 mendolover
mendolover's picture

Learn how to tie a necktie paper billionaire dick.

Wed, 10/01/2014 - 18:00 | 5277303 besnook
besnook's picture

so they have pounded the impending stock market crash for months only to crush small caps and now they start to roll out the cheerleaders for an end of the year rally?

Wed, 10/01/2014 - 18:04 | 5277317 Ewtman
Ewtman's picture

10 YR yields have been rising for several months and will continue to do so. They will enter, or  perhaps already have, a short period of correction. But the next move up will catch everyone by surprise and will prove to be problematic for all sorts of leveraged instruments. No one expects 4% yields anytime soon... but they are coming-- plus alot more.

 

http://www.globaldeflationnews.com/10-yr-treasury-index-yieldelliott-wav...

 

Wed, 10/01/2014 - 18:12 | 5277338 orangegeek
orangegeek's picture

that's good Tepper - six years of POMO has nothing to do with today's bloated markets - but since you are long and caught, pumping your crap to retailers in hopes of making them your bagholders is the thing you do, right Tepper??

 

here's today's shellacking on the SPX with more to come

 

http://bullandbearmash.com/chart/sp500-daily-takes-pounding-expected-pom...

 

are you finding it warm in here Tepper?

Wed, 10/01/2014 - 18:32 | 5277415 Spungo
Spungo's picture

He's right that the markets are fairly valued. Stocks being retarded expensive is exactly what one would expect to happen when the central bank quadruples the money supply and continues to expand their balance sheet. Fair market value will drop significantly if the money supply starts contracting (ie loans go into default).

I'll explain with an example of how the money supply grows or shrinks, and anyone can do this, sort of. Suppose I sell cars. You want to buy my car, but you don't have money. I won't physically lend you a bag of cash, but I'll give you the car in exchange for you signing a paper saying you owe me money. By doing this, we effectively expand the money supply. Before this transaction, we had 1 car between the two of us. After this transaction, your balance sheet says you have a car, and my balance sheet says I have a bond worth X amount of dollars. That bond is every bit as real as cash. I can sell the bond to someone else if I want (aka 'securitization' of shit loans), or I can keep it, and it goes on my balance sheet as an asset for the time being. What happens if you can't pay the loan back? Now the process goes in reverse. I get the car back, and the bond is worth next to nothing. The money supply effectively contracts. If this happens all over the country at the same time (aka 'credit contagion'), one would expect a tsunami of deflation to hit everything. Fair market value of stocks is suddenly 20% lower because the money supply just shrank by that amount. Real estate goes down, metals and oil go down, etc. This is why we're even seeing metals and oil drop in price at this time. The money supply is contracting as loans go bad.

That's what makes the 'fair value' argument hilarious. The market is ALWAYS at fair market price. It's that price for a reason. It's the drop in fair market value that we need to worry about. Something might be worth $10 today, but what will it be worth tomorrow? A house on the beach is worth $1 million while it's there, but it's worth 0 after a storm destroys it. Would you say it was overvalued at $1 million? Not really. It was fairly valued at $1 million and it was fairly valued at $0.

Wed, 10/01/2014 - 18:42 | 5277455 g'kar
g'kar's picture

A good read, thank you.

Wed, 10/01/2014 - 18:54 | 5277513 LooseLee
LooseLee's picture

No. Please explain the 'fairly valued' part w/o delving onto delusion....

Wed, 10/01/2014 - 18:39 | 5277435 LooseLee
LooseLee's picture
David Tepper---who cares? Fat, Ugly Pinko Commie POS.....'nough said!
Wed, 10/01/2014 - 18:40 | 5277441 financialrealist
financialrealist's picture

All of a sudden he’s an all-knowing seer…what an ass-wipe

 

Wed, 10/01/2014 - 19:19 | 5277466 Youri Carma
Youri Carma's picture

Monday’s Wall Street Journal reported a $10 billion outflow from Pimco that some estimate could increase to $100 billion.

http://www.forbes.com/sites/johntamny/2014/10/01/the-departure-of-bill-g...

So 10 billion is nothing according to talkin ass, David Tepper.

btw US Generic Govt 10 Year Yield at 2.39% now. http://www.bloomberg.com/quote/USGG10YR:IND

Wed, 10/01/2014 - 18:45 | 5277467 gmak
gmak's picture

Daddy Warbucks without the white eyes.

 

Wed, 10/01/2014 - 18:54 | 5277508 Yen Cross
Yen Cross's picture

  I'm trying to decide who's the bigger "Douche Nozzle"...

  Tepper or Fink?

Wed, 10/01/2014 - 19:24 | 5277615 sidiji
sidiji's picture

well he does have more money than you...and it's sorta true about the multiples and i-rate

Wed, 10/01/2014 - 19:42 | 5277663 sidiji
sidiji's picture

So if QE hits europe, eurostoxx 50 goes up?

Wed, 10/01/2014 - 19:43 | 5277664 sidiji
sidiji's picture

So if QE hits europe, eurostoxx 50 goes up?

Wed, 10/01/2014 - 20:04 | 5277717 WTF2
WTF2's picture

Tepper was in a foul mood.  He got absolutely killed in Fannie and Freddie, down 50% just today.  He got caught in most of his positons flat footed and the last thing he wanted to do is sit there pushing the Robin Hood Foundation.  Nice way to start the quarter David....

Wed, 10/01/2014 - 20:35 | 5277807 Nutflush60
Nutflush60's picture

Hey penis face, what was the earnings esitimate for the S&P 500 for 2014 last year at this team?

All of Draghi's money printing is not going to stop earnings fron crashing.

He knows this odf course, he is stalling tp clear out his longs as someone mentioned earlier.

 

 

Wed, 10/01/2014 - 20:39 | 5277808 Nutflush60
Nutflush60's picture

 

sorry prevoius comment posted twice

Wed, 10/01/2014 - 22:35 | 5278255 DipshitMiddleCl...
DipshitMiddleClassWhiteKid's picture

Hey Zerohedge retards

 

throw down your own money on distressed debt and make your own billions.

 

 

Thu, 10/02/2014 - 02:05 | 5278836 PeaBird
PeaBird's picture

So...does this mean that the probability of the following points happening has just increased?

1. Bill Gross' departure from PIMCO means game over for PIMCO (death by a thousand cuts?)

2. The US Economy is confirmed as FUBAR

3. HY credit aka Junk Bonds are peaking in price, if not already peaked in price

4. Stocks are at nosebleed levels, with multiples at nosebleed levels

5. That once he sells Fannie Mae & Freddie Mac, then they will rise...perhaps as a play on the US becoming a nation of renters (Fannie/Freddie buying up houses & units to rent out? Yield play?)

6. Ebola in the US is going exponential

Thu, 10/02/2014 - 08:38 | 5279318 Downtoolong
Downtoolong's picture

Is there any contemporary issue or topic that Tepper doesn’t feel qualified to discuss as a self-declared expert?

Tune in next week to hear David Tepper provide you with his brilliant thoughts about:

  • Global Warming

  • ISIS and the war on terror

  • The next Superbowl Champion

  • Leading-edge hypersonic aircraft design

  • Alzheimer's Disease & Treatment

  • Trends in cajun cooking

  • Taylor Swift

  • Coming fall fashions

  • ……

Of course, if you really want to know David Tepper’s deepest strategic thoughts about any of this, you’l’ have to pay for it. Just don’t expect him to guarantee it.

Do NOT follow this link or you will be banned from the site!