• Ricky Sandler, the CEO and chief investment officer of the $7 billion asset-management firm Eminence Capital, is so confident in stocks that he says you should refinance your mortgage and scoop up shares.
  • He pointed to dislocated markets, possible government stimulus coming down the pike, and the drastic precautionary actions the US is taking to quell the coronavirus’ effects as reasons for his bullishness.
  • Sandler thinks the market could push to new all-time highs once the pandemic is behind us.
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“My message to your viewers is refinance your mortgage, and take the money, and buy some stocks.”

That’s what Ricky Sandler, the CEO and chief investment officer of the $7 billion asset-management firm Eminence Capital, said on CNBC‘s “Fast Money Halftime Report” during a volatile stock rout

But Sandler’s eye-popping message isn’t without merit — and he comes to the table bearing a plethora of rationale for his bullishness.


“Every new headline, every new hysteria is making people more nervous — and it’s actually very, very positive,” he said in reference to the media coverage of the coronavirus. “It’s all helping to contain the problem. We are acting in a way that nobody ever thought we would.”

He added: “Because of the dramatic actions that citizens have taken, that businesses have taken, that local governments have taken, everybody has taken this seriously, and the best defense to this virus is to be on guard.”

To Sandler, the constant bombardment of warnings, precautionary guides, and information is working in favor of the economy. Though there will be temporary pain, the actions the US is taking as a whole are necessary for a fruitful economic future.

Beyond these measures, Sandler is quick to say he thinks this sell-off has been overblown.

“Let’s talk about the economic risk to everything stopping for two to three months,” he said.

US GDP is about $20 trillion, or about $5 trillion per quarter, Sandler said. He said Goldman Sachs revised its second-quarter GDP estimates down 5%, which would result in a $250 billion hit. But to be conservative, he doubled it to 10%.

Here’s the result.

“One-time $500 billion GDP hit, and we’ve lost $10 trillion in market cap,” he said. “It is so far out of proportion I don’t even want to talk about the numbers.”

In addition to overblown conditions, Sandler said the possibility of swift and forceful government intervention was a real possibility that shouldn’t be overlooked.

“This entire market would turn around in one second if the government came out and said: ‘We’re going to provide business-interruption insurance to companies that lose money in the second quarter if they don’t fire any workers,'” he said. “The truth is: A, I think the government should and will step in here to do something; B, it is not the end of the world, one quarter of big negative GDP.”

Moreover, Sandler thinks the possibility of banks foreclosing on businesses and homes because of this black-swan-esque event won’t come to fruition. “People are much smarter than that,” he said.

That said, Sandler sees confidence coming back to the US economy in three months’ time — and he even thinks markets could create new all-time highs once this is behind us.

“We will have pent-up demand. We will have massive fiscal stimulus. We will have lower interest rates and lower oil — I would argue businesses and the markets could make new highs from that.”

With all of that at the forefront of his attention, Sandler is busy picking up shares of beaten-down stocks.

Here’s what he’s buying: Marriott (MAR), Live Nation (LYV), US Foods (USFD), Bank of America (BAC), and JPMorgan (JPM).

“You can borrow money against your mortgage at 2.5, 2.75% and buy stocks that yield three times that level today,” he said.