Trump's deficit reduction triggers austerity alert, hedge fund tycoon Cooperman urgently cashes out.

Hedge fund manager Leon Cooperman stated that he is selling stocks and holding cash while the market is strong. Cooperman believes that President Donald Trump's deficit-cutting policy is "contractionary" and "unstable". Cooperman discussed the macroeconomic environment on Monday to guide his investment strategy. He believes Trump's focus on the deficit is "the right thing to do" but is causing concern in the market. Cooperman said, "The president's approach is right, but I think his execution is very unstable. He is trying to change the spirit of the whole country... I understand his approach, focusing on the deficit, but focusing on the deficit is contractionary." Cooperman believes that the current market valuations are too high, with a P/E ratio of 23 times, which makes him uneasy. He stated that for his portfolio, he is considering trading stocks with high growth prospects at a discounted price, especially Fidelis Insurance (FIHL.US) and Lithia Motors, Inc. (LAD.US). Cooperman also mentioned that he holds stocks in Vertiv Holdings (VRT.US), but he does not plan to sell at the current high valuation due to tax considerations. In his portfolio, Cooperman holds about 15% of short-term cash, as he believes stocks are better than bonds at resisting inflation risk. He said, "I have a very negative view on bonds - a bond with a yield of 4.2% is meaningless to me. In the long run, interest rates will rise." Cooperman's investment strategies reflect his cautious stance on the current economic environment. He emphasized that despite market uncertainty, there are still opportunities for high returns through careful stock selection.