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TEPPER: One presidential candidate is 'demented, narcissistic, and a scum bag'

Oct 17, 2016, 22:18 IST

Reuters

David Tepper, the CEO and founder of hedge fund Appaloosa Management, is not known for mincing words.

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And in a wide-ranging interview with CNBC's Scott Wapner on Monday, he had some choice words for one of the presidential candidates.

"One of them has bad judgment, and the other one is a demented, narcissistic and a scum bag," Tepper said. "I'll let you decide which one."

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.

And now, the market

Of course, the market is waiting for the outcome of this election. For now, Tepper is "pretty conscious on the market, not outright bearish." He's invested his fund mostly in the bond market, and has gone into cash.

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"We're pretty light in the stock market," he said. "I just don't see the market's ability to go 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... anti-pharmaceuticals," Tepper mused.

If the stock market then goes down based on this situation, Tepper thinks the Federal Reserve may become more dovish, and push off raising rates. This, he believes, it will 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 him if this view means that he's shorting bonds.

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"I'm not long them," Tepper responded.

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