by Adam Taggart
In my earlier piece this year A Hard Rain’s a-Gonna Fall, I recounted how David Tepper accurately predicted the massive ramp in asset prices that the Fed (and its brethren central banks) would cause with their QE efforts:
As the Federal Reserve kicked off its second round of quantitative easing in the aftermath of the Great Financial Crisis, hedge fund manager David Tepper predicted that nearly all assets would rise tremendously in response.
“The Fed just announced: We want economic growth, and we don’t care if there’s inflation… have they ever said that before?”
He then famously uttered the line “You gotta love a put”, referring to the Fed’s declared willingness to print $trillions to backstop the economy and financial makets.
Nine years later we see that Tepper was right, likely even more so than he realized at the time.
As if we needed another sign that the Everything Bubble has popped, Tepper just said this (per CNBC):
“1. Powell basically told you the Fed put is dead.
2. Everyone is tight. Chinese money growth plummeting. ECB cutting the last of QE. And Fed still in tightening mode.
3. The net biggest issuance of Treasuries and worldwide fixed income is coming next year. Something is going to get crowded out. Bonds stocks etc.
4. Oh and there is this trade war question. I think we should be having a fight with China on different issues. But it is not conducive to confidence. Freezing some worldwide activity.
5. Cash is not so bad. ”
Strap in folks. It’s a looong way down from here.