The David Tepper Rally has not yet turned into Tepper Rout in the markets—the major indexes are holding just about where they went immediately following Tepper’s remarks on Squawk Box—but his “win-win” analysis is taking a drubbing from respected financial commentators.
Most of the criticism takes aim at Tepper’s belief that Fed policy aimed at reviving the economy will boost the values of financial assets. In Tepper’s brief, stocks will do well if the economy recovers on its own or they will do well if the economy falters and the Fed intervenes.
No doubt he’s encouraged in his view by the fact that he made a king's ransom—no, make that an emperor’s ransom—on betting the government’s intervention on behalf of banks would boost the value of their stocks and bonds. Hey, it worked last time: let’s double down on government aid.
Yesterday we brought you David Rosenberg’s critique , which can be summed up as “the first round of quantative easing didn’t work, so why would anyone think the next round would work?”