David Einhorn, the Greenlight Capital manager who can puncture a stock’s price with a mere flap of his gums, has joined Sarah Palin, China, Germany and many others in criticizing the Federal Reserve’s recently announced $600 billion bout of quantitative easing.
From The New York Times:
“It is perverse that on the heels of suffering the after-effects of the collapse of the Internet bubble and then the real estate bubble (both of which the Fed disclaims responsibility for creating or supporting), the Fed would like to encourage the formation of yet another bubble,” Mr. Einhorn wrote in Greenlight’s most recent investor letter, dated Nov. 1.
Einhorn criticized the notion that quantitative easing would carry with it a wealth effect, and cautioned investors against buying heavily into stocks, because their prices could collapse if the market were to lose faith in the Fed’s monetary interventions.
mtaylor [at] observer.com | @mbrookstaylor