Wednesday, January 19, 2011

[Video] CNBC - Jeff Gundlach of Doubleline Capital

CNBC had an interview today with the rarely seen bond guru Jeff Gundlach, lately of his new firm Doubleline Capital but previous to that TCW.   Along with Loomis Sayles' Dan Fuss, and PIMCO's Bill Gross, Gundlach would be considered cream of the crop in the bond game - despite an uhhh, 'eclectic' background that led to his ouster at TCW.  (for the sordid details see this Fortune story)

I would have liked some better questions but basically it was a "what do you think of corporate bonds?", "what do you think of munis?" "what do you think of high yield?" sort of deal.  He does make some interesting points, especially the psychological aspects of what he thinks is going to hit the muni market, but the interview sort of ran too short. 

Here is a 9 minute clip, one can skip to 0:45 to get started.  I've added some text from a Reuters article last week below.  Being a bond guy I am not sure his accuracy with stock market calls, but he certainly offers his view.

  • As far as U.S. stocks go, Gundlach said: "I am not predicting a negative 38 percent 2011, but I deeply believe that stocks bought today will show double-digit losses at some point in 2011." He added: "The quantitative easing II impact on risk assets seems to have pretty nearly run its course, in my view."
  • During DoubleLine's December client call, Gundlach said the then-rapid rate rise in the 10-year Treasury note's yield of 3.50 percent would hit "exhaustion" in the weeks to come and that investors should purchase Treasuries and bond funds
  • ....Gundlach reiterated that he sees stagnant wage growth, highly indebted consumers and a weak job market.

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