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MQS Asset Management CEO Bob Gelfond argues a change of economic policies and creation of productivity can give the market a boost.
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XT three points now my first guest says let the Fed is not being helpful.
He doesn't think we need monetary easing so the question is what does he think will give this economy and market the boost it needs.
Joining me now Bob -- and and q.s asset management global macro hedge fund Bob thank you so much for being here it was seeing the market react to this.
Is is really based on the gloom and doom that the fed policy makers appear to be talking about is that what the market's reacting to.
Well I think that the market is -- it seemed to have QE3.
Come again.
Why disagree you know I don't -- -- that'll help too much I think that's what the markets sort of sort of want.
They talk about needing perhaps some putting more tools into its tool box I mean what else can the Fed did and ended.
They they can always increase -- balance sheets and more that would be doing another round of of QE3.
And -- on the QE.
But it's not clear how much -- that would help and in fact it's it's pretty.
Unclear that QE2.
Didn't anything more than no help boost asset prices.
Right commodity prices I don't think -- any real positive effect on the economy and we don't have a liquidity crisis doing that's right what we have -- is an issue of creating more productivity for the economy -- -- to really see.
Growth and it -- with the big downturn that we saw 20082000.
Line.
We really should be seeing growth were like 45.
Even higher 45% a year.
Much stronger employment growth -- well this is an incredibly tepid recovery for for this point of the cycle.
We had -- mentioned in the minutes there they talked about the concern about what's going on in Europe and a global slowdown particularly in China which is the bigger problem and -- mind.
But I think they're both important and and the fact that they're both happening the same time makes it that much worse and indeed at least.
Ended 2009 we had China is still doing fairly well meg -- -- -- as a locomotive for the world economy.
Now that everyone is is either slowing down -- in Europe's case going into recession.
That really makes our life that much more complicated than I think in this stock market being down last few days is sort of taking that in.
-- also mention in the Fed minutes about this fiscal cliff facing this country does a lot of uncertainty because this is an election year.
What do you think the impact of the election could be.
Well there's going to be continuation of the same policies that I don't think that's gonna be very good for the economy -- stocks can still do well in that type of world.
Because of the Fed as liquidity that will bolster asset prices but in terms of the real economy.
I think that will be you know quite damaging.
If if we have new leadership then and there really isn't a change of course less from the republic right though.
The White House and congress we really didn't -- much which -- you saw a big increase in spending.
And regulation.
But if there isn't that you change in economic policy.
I think the markets woods wouldn't you know welcome that and then more importantly the real economy would would start.
Perking up quite quickly.
Went down eighty points now is that was the the belief the QE3 is just around core resorting baked into this market.
I think it's somewhat I think that no one was really expecting there to be.
The of the Golden Nugget and right in the notes here that was say it's it's it's on the horizon.
11 factors that the Fed is starting to feel political pressure as election comes closer.
I think Bernanke certainly wants to too much more aggressive monetary policy.
He's student of the depression and it's right his view that that's.
What prolonged the depression was that the Fed didn't act.
Adequately providing liquidity.
I disagree but I certainly -- what he what he intends to do I believe all right Bob Kaufman thank you so much for being here commenting on the Fed minutes the markets down 85 points about the --
