Gundlach – “Shaky and Feeling Dangerous”
Another Wall Street legend, Jeff Gundlach, head of the $100 billion DoubleLine fund and who Barron’s famously called the “King of Bonds”, is voicing warnings of what’s to come and advising gold as the place to be. Gundlach joins the chorus of billionaires we’ve reported recently of (click to read) Druckenmiller, Soros, Icahn, Singer and Gross recommending gold.
On bonds (US Treasuries) and as we reported Wednesday:
"You're seeing people who hated the '2 percent' 10-year suddenly loving it at a 1.38-1.39 percent revisit of the all-time low closing yield…..If you buy 10-year Treasuries now, I would say, it is a terrible trade location. In fact, it is the worst trade location in the history of the 10-year Treasury."
So to be clear, the Bond King wouldn’t touch bonds with a long pole at the moment.
On the Euro banking crisis:
"Banks are dying and policymakers don’t know what to do….. Watch Deutsche Bank shares go to single digits and people will start to panic... you'll see someone say, 'Someone is going to have to do something'."
That something would be the ECB increasing their already aggressive/desperate Eur1.2 trillion QE (money printing to buy bonds) program and possibly even more negative rates. Not surprising then, on gold:
"gold remains the best investment amid fears of instability in the European Union and prolonged global stagnation, as well as concerns over the effectiveness of central bank policies…. Things are shaky and feeling dangerous…. I am not selling gold.”
Indeed Gundlach is on record predicting US$1400 this year.