Posted on 03/23/2020 8:44:29 PM PDT by lasereye
Hedge-fund manager David Tepper says there is nothing wrong with “nibbling” at stocks that have experienced a brutal selloff in the past month, amid growing fears centered on the economic impact of the coronavirus pandemic. However, the star fund manager and billionaire says that U.S. lawmakers and the Trump administration need to act quickly to stabilize the economy and mitigate the damage from the deadly pathogen.
“There’s nothing wrong with nibbling here,” the founder of Appaloosa Management said during a phone interview with CNBC on Monday, referring to stocks that have fallen at an unprecedented rate, as business activity across the globe shutters in order to contain the illness, COVID-19, the infectious disease that was first identified in Wuhan, China in December. Nearly 370,000 people have contracted the illness and some 16,000 lives have been lost, according to data compiled by Johns Hopkins University.
“It might be time to buy a little, and that means a little,” he emphasized. He cautioned that the market could still fall by another 10% or 15%, and investors should be willing to endure further pain.
With that in mind, he told the business network that investors need to be prudent in identifying stocks in the wake of the carnage at least partly sparked by the outbreak.
Asked if it was time to buy stocks, Tepper asked, rhetorically, “Which stocks?”
”You have to be very selective, right here,” he admonished.
“I can’t wait to invest again,” he said, striking an upbeat tone.
Tepper may be best known for the concentrated bets he made on the financial system during the 2007-09 financial crisis, when he cited the backstop provided by the Federal Reserve as a reason to own beaten-down bank shares.
(Excerpt) Read more at marketwatch.com ...
I agree.
I think a HUGE run-up from here, will virtually explode the markets.
Just my own opinion.
It is time. The malaria drug appears ready to be proven, maybe as quickly as this week.
My 401K has lost a bunch, but since I haven’t changed my investment selections, I’m buying all of my depleted stocks at rock bottom prices with my $1,000/month investment. So, it’s not as bad as it feels. (I hope)
What about moving money into gold-backed IRAs? This flooding the economy with more printed money will bring hyper inflation, I think.
” I haven’t changed my investment selections, I’m buying all of my depleted stocks at rock bottom prices”
I like your strategy.
I ditched my 401K at 27K, but it is for a past job I have not worked at for two years and my income was low enough last year it doesn’t matter.
If the Dow gets to around 15K I will start really looking.
If it gets to ~13K I will pounce with whatever I can.
“I think a HUGE run-up from here, will virtually explode the markets. Just my own opinion. It is time. The malaria drug appears ready to be proven, maybe as quickly as this week.”
totally ... and starting tomorrow at that ... today, President Trump REPEATEDLY signaled he’s going to end this thing quickly, in a matter of weeks, which i think will actually start as soon as the NY clinical trial that starting tomorrow (tuesday) begins to generate positive results ... personally, i’ve made some REALLY BIG bets going back into the market in the last few days, betting that President Trump knows a hell of a lot more than he’s saying in public and that he’s sending signals to anyone smart enough to listen to him ...
“What about moving money into gold-backed IRAs? This flooding the economy with more printed money will bring hyper inflation, I think.”
it’s much more likely that the stock market is going to explode upwards in the next couple of weeks and the economy will follow thereafter ... inflation is at zero and has been for a long time, so a cash injection done correctly will help accelerate the recovery without adding meaningful inflation ...
i’m not an investment wizard, but i’d strongly advise you not to make a bet that inflation will rage out of control ...
Tepper suggests buying only a little. But they'll probably work out over a longer time frame no matter what happens in the next few months.
On the subject of trying to pick the bottom.
1) You only know it after you missed it. The bottom can ONLY
be seen in the rear view mirror.
2) There are skyscrapers all over the world, dozens or maybe hundreds of them, full of scary smart people with massive computer system with multi-million dollar software programs scanning a thousand databases 24 hours a day. Oh, and most of them get it wrong. But not you, you can call it. I don’t mean to offend, but what you propose is foolish. You are throwing darts in a dark room and you have no idea where the dartboard is. And you expect to hit a bullseye. Did I mention that the dart board is moving? This thing could rebound in a month, it could take 2 years. Nobody knows, since the world economy has never come screeching to a halt like this before, nobody know for sure how to restart it. You have one and only one chance.
3) Take what you were going to invest.
4) Divide it by 12
5) Buy your selected index once a week for 12 weeks.
6) Turn off your computer for 2 years.
7) Turn it on and take a look.
Other than that you are just guessing, which is OK
I guess. If you guess right, don’t pretend it was because you were smart. It was because you were lucky. I really hope the best for you.
I’m a long time adviser, and your advice is pretty good.
Over the years, I’ve seen such crap posted here at FR about investing...
Article and most comments suggest a sucker’s rally on the horizon.
He cautioned that the market could still fall by another 10% or 15%,
Good I’ll wait till then and buy lower.
Is this the same David Tepper who bought and destroyed The Carolina Panthers?
I expect strong aftershocks to the hit the markets when the awful numbers are reported in future months. Jobs, Housing, etc. Jobs are probably already priced in somewhat but housing isn’t. The Dow at 15k seems like a real strong possibility at this point.
I think we might get to see a bear rally and then continued downward movement as the bad numbers come in from every direction for the next few weeks or months. Unemployment, earnings reports, production numbers, oil prices, I am hard pressed to come up with one that I think will be positive for a while. I believe that there are massive amounts of liquidity being injected not to prop up the markets, but to allow it to have a controlled crash. Without the amount of liquidity being injected right now, the economy wouldn’t crash, it would freeze. They say when the U.S. sneezes the world catches cold. What happens when the U.S. gets a cold and then the flu? I am currently trading options and long OTM puts on everything is the name of the game. If tomorrow is an up day, and that’s a big if, it’s just another shorting opportunity. Just one man’s opinion.
I think the world
Mitigate the damage from the deadly pathogen??? The pathogen didn’t cause any unusual damage yet, many 10’s of thousands of people die in the U.S from the flu every year. Everything that has happened in the U.S. so far we did to ourselves. We are missing some perspective here. 160,000 people a day die on planet earth. The first official death from Corona-virus was recorded on Jan 22. 60 days ago. 275 a day. About 2/10’s of 1% of deaths worldwide, and we are in the middle of destroying one of the best economies this planet has ever seen. 10’s of millions will die as a result of the economic carnage we are doing. Come up with a plan that doesn’t guarantee economic suicide. Isolate everybody over 60. Put the rest back to work on staggered schedules or whenever they get masks. Anything is better that killing the patient to cure the disease. Jesus, will somebody get a clue here!
I don’t know.
I think we are in for a powerful jump.
The driver, will be documentation, starting the end of this week, of actual success with the repurposed treatment option.
HUGE jump, and it will drive, rehiring.
Maybe. :)
There might be some logic of gold-backed IRAs, if this were a six to nine month long deal. I would be fearful at the end (which might be in 60 days), and suddenly the gold prices max out and go into full retreat. Timing is everything with gold.
‘Timing is everything with gold.’
a reminder of a terrible period in my investing days...mostly out of the market now, living in the most vulnerable cohort for the virus; lock me away, let the young have at it in life...
"Moving" money implies selling something here to go buy something else over there.
Not a good idea unless you subscribe to "sell low" theory.
If you have extra cash, now, that's something totally different!
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