Tags: Dan Loeb | Trump | Animal | Spirits | Matter

Billionaire Dan Loeb Applauds Trump Tactics: 'Animal Spirits Matter'

Billionaire Dan Loeb Applauds Trump Tactics: 'Animal Spirits Matter'
(AP/Charles-Rex-Arbogast)

By    |   Friday, 28 April 2017 08:43 AM

Activist hedge fund manager Dan Loeb applauds the vigor and enthusiasm the election of Donald Trump as president has injected into the financial markets.

Loeb, who's more than doubled the S&P 500's return over the last two decades, told investors he doesn't plan on missing out on the final portion of this eight-year bull market.

"While we recognize that we are in the late stages of an economic cycle, experience has taught us not to miss the end of an expansive period," the Third Point manager wrote in the letter obtained by CNBC.

"This is especially true following Trump's election. Animal spirits matter in markets and despite the obstacles that the new administration will face in passing legislation, the overall pro-business environment is in sharp contrast to the last 'you didn't build it' administration's attitude towards business, enterprise, and free markets."

Loeb said that opportunities were ripe for his style of investing, disclosing that the fund had made new investments in the financials, industrial and energy sectors last quarter.

"We expect the favorable environment for our investing style to continue for three reasons: 1) Corporate activity should pick up as President Trump's tax plans are detailed and enacted; 2) Opportunities for activist and constructivist investing are robust; and 3) Combining security selection with a reasonable interpretation of the macro continues to be critical," the letter stated.

Loeb admitted that Trump is not actually at the center of his bullishness. It's actually global economic growth that's got him excited. The manager cited a Goldman Sachs forecast for global GDP growth to top 4 percent this year, double the pace of a year ago, CNBC.com reported.

Third Point reported meager returns in the letter that do not seem to match Loeb's enthusiasm. Third Point returned just 5.9 percent last quarter, slightly below the S&P 500's return.

For his part, veteran financial guru and former Ronald Reagan adviser Larry Kudlow is urging any impatient investors to just give Trump a chance to fully enact his strategies to reform healthcare, spark economic growth and redesign the tax system.

After all, Trump has been in office a relatively short time and has inherited a mountain of problems from the past two decades. “He's trying to fix a lot of problems that have gone unfixed in the last 20 years,” Kudlow explained to CNBC.

Meanwhile, many other respected economic voices are predicting robust growth and additional stock-market gains amid Trump's blueprint to truly "Make America Great Again."

David Horowitz, author of the best-selling book "Big Agenda: President Trump's Plan to Save America," told Newsmax TV that the market rally since Republican Donald Trump won the election has more room for gains as the president pushes his pro-business agenda.

“There's more upside. Starting from when he was president-elect he started this stock market boom,” he told Newsmax TV's “The Income Generation Show.” 

“There will be corrections. There are going to be setbacks along the way like the healthcare which they hurried too fast. If you're looking over the long term of this administration I think the stock market is going to love Trump,” Horowitz said.

"Big Agenda: President Trump's Plan to Save America" is available at bookstores everywhere – or get your copy on Amazon – Click Here Now

(Newsmax wire services, Reuters and Bloomberg news contributed to this report).

© 2019 Newsmax Finance. All rights reserved.

   
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"This is especially true following Trump's election. Animal spirits matter in markets."
Dan Loeb, Trump, Animal, Spirits, Matter
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2017-43-28
Friday, 28 April 2017 08:43 AM
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