David Tepper, the CEO and founder of the hedge fund Appaloosa Management, is not one for mincing words.
And in a wide-ranging interview with CNBC’s Scott Wapner on Monday, he had some choice words for one of the presidential candidates.
“You have one person with questionable judgment, and the other person that may be demented, narcissistic, and a scumbag,” Tepper said. “I’m not saying which one is which. You can make your own decision on that.”
Tepper, who is well known on Wall Street for his blunt manner, has historically leaned toward the Democratic Party, though he has supported candidates on both sides of the aisle. This year, he said, he has not financially supported either candidate for president – Democrat Hillary Clinton or Republican Donald Trump.
And now, the market
Of course, the market is waiting for the outcome of this election. For now, Tepper is “pretty cautious on the market, not outright bearish.” He’s invested his fund mostly in the bond market and has gone into cash.
“We’re pretty light in the stock market,” he said. “I just don’t see the market having the ability to move up that much.”
Here’s how he looks at the potential outcome of the election: If the Democrats take the Senate as well as the White House, we’ll see a more highly regulated environment – “highly anti-bank” and “anti-pharmaceuticals,” Tepper said.
If the stock market goes down based on this situation, Tepper said he thinks the Federal Reserve may become more dovish and push off raising rates. This, he believes, it would do at its own peril.
“A steeper yield curve is better for all of these economies,” he said, referring to Germany, the UK, and the US. Higher yields would help banks – especially ailing banks in the EU – and state pension funds, for example.
Wapner asked Tepper if this view means that he’s shorting bonds.
“I’m not long them,” Tepper responded.