This post was originally published on this site
Greenlight Capital’s David Einhorn told CNBC on Wednesday that he maintains his negative view of the stock market as he believes rates are headed higher.
Speaking to CNBC’s Halftime Report, Einhorn stated that “we should be bearish on stocks and bullish on inflation” as he feels the current policy will be “increasingly difficult” for financial assets.
The Greenlight Capital founder and president also explained that rates will continue to move higher. “I think that both long- and short-term rates are headed higher and probably higher than what people are expecting,” he says, adding that the economy and employment are strong and current fiscal and monetary policy is “very stimulative.”
In addition, Einhorn believes the Fed wants stock prices lower.
“Well, they talk about it as tightening financial conditions, and so I think that phrase is mostly about the stock market,” he stated. “The Fed does want stock prices lower. They’ve made that clear.”
However, he thinks it “would be better if they cared less about the stock market in either direction.”
Later on in the interview, Einhorn said he is buying back Tenet Healthcare (NYSE:THC), which he sees as recession resistant. In addition, Einhorn spoke on Teck Resources (NYSE:TECK), which he stated has a strong cash flow and is trading at a low multiple.
Meanwhile, on stock buybacks, Einhorn explained that he likes stock buybacks that focus on taking shares out of the market but doesn’t like those that repurchase inflated stocks it paid to employees.
