Government intervention in the financial markets virtually guarantees that most investment choices will go up, hedge fund manager David Tepper told CNBC. Even though market reaction has been tepid, Tepper said this week's Federal Reserve Open Market Committee statement reflected a clear "put"—or the equivalent of an options play in which the government will do whatever it needs to keep the capital markets from sinking below a designated level.
"What, I'm going to say, 'No Fed, I disagree with you, I don't want to be long equities?'" said Tepper, president of Appaloosa Management in Short Hills, N.J., which oversees $12.4 billion in client assets. "We're a bond place, but we changed up to a little bit more equities recently."
"Either the economy is going to get better by itself in the next three months...What assets are going to do well? Stocks are going to do well, bonds won't do so well, gold won't do as well," he said. "Or the economy is not going to pick up in the next three months and the Fed is going to come in with QE.
You talk about when you get moments," he said, referring to the Fed statement. "This might be one of those—kind of."
Tepper, who is notoriously shy when it comes to granting interviews, appeared to move the market as he spoke.