Tepper did it again.
Recall that exactly one year ago, we wrote about David Tepper's latest TV appearance on BBG TV, when we reported that "David Tepper Dumps 40% Of US Equity Exposure Despite Claiming "Stocks Inexpensive" in which we said the following:
Submitted by Charles Hugh-Smith of OfTwoMinds blog,
Rather than fix what's broken with the real economy, ZIRP/NIRP has added problems that only collapse can solve.
The fundamental premise of global central bank policy is simple: whatever's broken in the economy can be fixed with zero interest rates (ZIRP). And the linear extension of this premise is equally simple: if ZIRP hasn't fixed what's broken, then negative interest rates (NIRP) will.
The algos are happy. Headlines proclaim Iran "supports" the Doha proposal to "freeze" oil production levels (at record levels) and oil spikes. However, what they failed to grasp was Iran's lack of commitment to actual production levels... i.e. Iran fully supports production cuts for everyone else... but will not freeze its own production.
Oil prices limped higher overnight in their ubiquitous carry-driven way, only to tumble quickly this morning as the reality that, as Goldman says "at record levels, this production freeze doesn't help at all") and clear indications from the meetings in Tehran that Iran will do 'whatever it takes' to increase its production to pre-sanctions levels. WTI is back below $30.
As Bloomberg notes,
Any output-freeze agreement among key oil producers is being dismissed out of hand by oil bears.
In 17 of the 19 times in the last 100 years that Industrial Production has contracted for 3 consecutive months, the US economy has entered recession. Today 0.7% drop YoY is the 3rd month of declines.
The only times in the last 100 years that 3 months of US Industrial Production contraction has not coincided with a recession was in 1934 and 1952... (and the current decline is larger than 1952's in aggregate)