Gundlach: Another Wave Down

“The reason the markets aren’t going lower is people are holding and hoping. The market bottoms out when people are selling and sold out — not when they are holding and hoping. I don’t think you’ve seen real selling in risk assets broadly. Markets need buying to go up and they need volume to go up. They can fall just on gravity.”

DoubleLine Capital co-founder Jeffrey Gundlach warned after the weak jobs number on Friday that the US equity market as well as other risk markets including high-yield “junk” bonds face another round of selling pressure.

“People are acting like everything is great. Junk bonds are at a four-year low. Emerging markets are at a six-year low and commodities are at a multi-year low — same level as in 1995 … GDP is not growing at a nominal basis. … Clearly what’s happening is people are waking up to the idea that global growth is not what they thought it was.”

Even International Monetary Fund Managing Director Christine Lagarde affirmed this, Gundlach said: “You talk about an important moment when somebody who is traditionally a cheerleader for a bright future says, ‘I have to downgrade my global growth forecast,’ as Lagarde did.”

— Excerpt contributed by Jason Kelly

_____________________________________

Z-val: Jeffrey Gundlach
Via: Reuters
Date: 10/2/15
Disposition: Immediate-Term Bearish
S&P 500 on 10/2/15: 1951
S&P 500 on 11/2/15: 2104
Change: +7.8%
Judgment: Wrong

Z-val definition and more forecasts in The Z-val Zone.

Gundlach

Scorecard

This Forecast

Accuracy

of 1

Judged

Forecast

Created with Snap
This entry was posted in Z-vals and tagged . Bookmark the permalink. Both comments and trackbacks are currently closed.
  • Here are your three options:

    Option 1: Annual Subscription (no refunds)

    For just $200 per year, you’ll receive everything listed above to completely upgrade the way you manage your investments. This is 17% cheaper than the monthly option. This is what I recommend:






    Option 2:Monthly Subscription (no refunds)

    If you'd like to try The Kelly Letter  without paying the full year, you can pay $20 per month.





    Option 3:Free Email List

    If you'd like to hear more from me but aren't ready to part with any money yet, you're welcome to join my free email list:

    Join the free list





    Thank you for the work you do. You're a household name here and my wife and I often discuss your letters on Sundays. My ten- and seven-year-old children recognize your name and will eventually be taught to invest using 3Sig and 6Sig. You've had an enormously positive impact on our investing and inspired me to look at the world in more rational and clear terms than I did years ago. I'm sure that thousands of others would say the same. Kelly Letter subscriber Matt Barnes
    Matt Barnes
    Product Line Director
    OCLC

    Join Matt and thousands of other rational investors to invest without stress.

    Subscribe to The Kelly Letter  now!

Bestselling Financial Author