Gundlach spoke in a CNBC interview:
- what we’re seeing appears to be deleveraging in the bond market-
- believe there is
some forced selling going on in bonds, and is probably not ending - the Fed is really
not in a position to reverse course or resume rate cuts - the odds favor a
recession at this point - think the Fed will
use their balance sheet if things get worse, think they would do that
before cutting - believe that long
yields will go up - believe rates will
go up in the next recession at the long end - “no way” tariffs
delay is going to happen, Trump will keep this going
None of this sounds very optimistic from Gundlach. Market professionals are in a dour mood over this dog’s breakfast of policy choices.
This article was written by Eamonn Sheridan at www.forexlive.com.