SALT 2015: Fighting The Fed, Activists And The Loeb-Buffett Rant

Day 2 of the 2015 SALT Conference is in the books. Presented in Las Vegas by SkyBridge Capital, the second day of the event brought together a wide range of opinions on the markets.

Fighting The Fed

Peter Schiff talked about the Fed, and in particular, its forecasting inadequacies. In an interview with Benzinga, Schiff said the coming economic crisis could be worse than ’08. “We refused to face the music years ago,” he added.

On the subject of interest rates Schiff said even a boost as little as 25 basis points could be “risky” for the economy.

Dan Loeb

Mega-hedge fund manager Dan Loeb, meanwhile, took the stage later in the day to discuss his investing strategies, Yum! Brands, Inc. YUM and — surprise — Warren Buffett.

Loeb’s two rules for the current economy: Don’t fight the Fed, and don’t fight the Godfather, David Tepper.

Tepper discussed central bank policy earlier this week at the Ira Sohn conference.

On Yum, Loeb said his firm “saw an opportunity.” He sees three reasons the food company is an attractive investment:

• Its turnaround potential is under appreciated by the market.
• Franchising operations have potential.
• There’s also the possibility Yum could split its Chinese division from operations.

A Yum China could deserve a higher multiple, Loeb added, and has “enormous upside.”

Finally, Loeb also talked about Warren Buffett. Twitter caught the action:

Activist Panel

Later in the day, activists Clifton Robbins, Barry Rosenstein, Tom Sandell and Jeff Smith discussed their strategies.

Robbins, who manages Blue Harbour Group, highlighted Investors Bancorp, Inc. ISBC, and said it’s one of the best risk-rewards he’s ever seen. His firm owns 9 percent of outstanding shares, he added.

Robbins explained that the bank has a $4 billion market cap and $2 billion in cash, which makes it an attractive investment in his eyes. He predicted the stock will “rapidly appreciate.”

Jeff Smith of Starboard Value, meanwhile, commented on Yahoo:

The four strategies he wanted Yahoo to implement — an Alibaba spinoff, a Yahoo! Japan spinoff, the real estate market, and cost-cutting — have largely been adopted by the company, he added.

Barry Rosenstein of Jana Partners, lastly, talked about QUALCOMM, Inc. QCOM. The company is his firm’s “biggest investment ever,” and has “tremendous value with little downside,” he said.

When placing a fair multiple on Qualcomm’s patent business, it investors can buy shares of the company for “free,” Rosenstein explained. He said he’s “very, very excited” about the future of Jana’s investment in Qualcomm.

Day 3 brings many more top guests, including T. Boone Pickens, Kyle Bass, Leon Cooperman and Sir Richard Branson.