Jeffrey Gundlach will speak at the 2019 SOHN Conference held in New York on May 5th, 2019.
Adam Jeffrey | CNBC
Doubleline Capital CEO Jeffrey Gundlach said Thursday that there could be another painful volatility on the horizon as he views bonds as increasing risk of a recession.
“I think investors should have already upgraded their portfolios… I think we have another risk,” Gundlach said on CNBC’s “Closing Bell.”
Gundlach, who managed about $95 billion at the end of 2024, said Doubleline had reduced the amount of money he borrowed to amplify his leveraged fund position to the company’s 16-year history low.
Recently, aggressive tariffs on President Donald Trump’s major trading partners have sparked fears of economic slowdowns, causing a month-long pullback on the S&P 500, which revised its benchmark 10% last week. The index is currently about 8% below its all-time high in February.
Widely running investors are looking at the odds of a 50% to 60% recession in the future.
“I think the chances of a recession are higher than most people believe. In fact, I think it’ll be over 50% in the next few quarters,” Gundlach says.
His comments come after the Federal Reserve downgraded its economic growth outlook and hiked the inflation outlook on Wednesday, causing a stag horror. The Fed expects to make two rate cuts for the remainder of 2025, despite saying its inflation outlook is getting worse.
Gundlach recommends that US investors move away from American securities and find opportunities in Europe and emerging markets.
“It’s probably time to pull the real triggers of investors based on dollars that simply move away from US investments, and I think that’s going to be a long-term trend,” he said.
