David Tepper, founder and president of Appaloosa Management.
Cameron Costa | CNBC
Hedge fund billionaire David Tepper said the Federal Reserve could cut more fees, but then if central banks go further, they risk more inflation and other risks to the economy and markets.
In other words, beware of what you want.
“Depending on what happens in the economy, if they’re too much more for interest rates… it’s going into dangerous territory,” Tepper told CNBC’s “Scokebox” on Thursday.
His comments come after the central bank showed that two more cuts are coming this year after the central bank cut interest rates by Wednesday’s quarterpoint, the first cut of the year.
Tepper feared that if the Fed lowered rates while inflation was not completely tamed, demand would pick up faster than supply and rekindled price pressure. Meanwhile, simple and simple monetary policy can potentially generate asset bubbles as investors flock to the riskier corners of the market.
The founder and president of Appaloosa Management said it was highly rated, but noted that he still won’t bets on stocks while the Fed is still in easing mode.
“I don’t like multiples, but how do I not own them?” Tepper said. “I’m not fighting this, especially when the market told me…it’s hard to own that, as one quarter cut will be one quarter and three-thirds by the end of the year.”
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