‘This is a really huge buy signal’: Billionaire Bond King Jeffrey Gundlach lays out a juicy investment setup worth seizing — one that’s only happened a handful of times in the last 100 years

Jeffrey Gundlach

Jeffrey Gundlach — the CEO and chief investment officer of DoubleLine Capital — shares an investment setup happening right now that’s historically rewarded patient investors.
Prior to this instance, it’s occurred just two other times in the last century.
Gundlach says the US dollar “should weaken” in the near future — a core expectation that helps dictate some of his other forecasts.
Unrelated to the his US dollar forecast, Gundlach says bitcoin will climb as high as $15,000 in 2020. The prediction comes on the heels of his spot-on bitcoin forecast for 2019.
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It was hard to lose money in 2019.

The S&P 500 returned 29%, emerging market stocks gained 15%, oil increased 34%, gold swelled by 19%, and US bonds climbed 8.7% in aggregate.

Still, many experts say the likelihood that investors will reap similarly broad-based returns across asset classes in 2020 is unlikely.

But Jeffrey Gundlach, the CEO and chief investment officer of $140 billion DoubleLine Capital, sees opportunities on the horizon — and a simple theme ties them all together: a weaker US dollar.

“It seems like it’s just about time for the dollar to weaken,” he said on a recent webcast.

Gundlach is adamant that the US dollar will depreciate for three main reasons: foreigners starting to divest from the US, the Federal Reserve’s continued insistence upon printing money, and a blown-out budget deficit.

Below is a chart depicting the relationship between the US dollar and current account and budget balance of the US. Gundlach says that historically speaking, the dollar — with a lag — is highly correlated to the movement in the twin deficits (brown line). This leads him to believe that a weaker US dollar (black line) is on the horizon.

With the prospects of a weaker US …read more

Source:: Business Insider


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