In David Einhorn’s fourth quarter letter to investors (which reveals a respectable net return of 4.5% for Q4 and 8.4% for 2016), the avid poker player reveals himself as yet another closet supporter of Trump policies, stating that he expects the economy to “accelerate” once Trump’s still undetermined policies are implemented.
Looking back, Einhorn writes that “since Election Day, the market appears to have changed its macroeconomic outlook and is reevaluating the prospects for many companies accordingly.” This, of course, is the so-called Trumpflation rally, which however may have fizzled overnight with Trump’s stated opinion that the USD is now overvalued. Nonetheless, Einhorn points out that “this change in tone has been favorable to our style, and we generated a good result in the quarter despite our low net exposure and a decline in gold.”
But, as he then breaks, “rather than look backward, we’d like to share our views of what a Trump Presidency (TP) might look like and why we believe we are well-positioned for 2017. In short, we believe that the post-Great Recession easy money policies have been good for Wall Street but bad for Main Street. It’s possible that the TP reverses these policies, which would be good for Main Street but rough on Wall Street.”
So looking forward, Einhorn is, for now at least, that the fiscal stimulus emerging from the Trump presidency will be favorable both for the economy…
This post was published at Zero Hedge on Jan 17, 2017.