Best of the Week
Most Popular
1.Gold And Silver Voodoo Analysis Price Forecasts - Austin_Galt
2.UK Saved From I.S. Threat But Scottish Independence Nightmare is Not Over! - Nadeem_Walayat
3.Silver Price At or Very Close to an Important Low - Clive_Maund
4.Gold And Silver - PetroDollar On Its Deathbed? PMs About To Rally? No - Michael_Noonan
5.Gold and Silver Bear Phase III Dead Ahead - Rambus_Chartology
6.Stock Market Major Selloff Looms - Zeal_LLC
7.Inflate or Die! When Leverage Fails and Market Hope Turns to Fear - Ty_Andros
8.Gold Price Very Close to an Important Low - Clive_Maund
9.Market Forecasts for Stocks, Gold, Silver, Commodities, Financials and Currencies - EWI
10.U.S. Aggression - Will Russia and China Hold Their Fire? - Paul_Craig_Roberts
Last 5 days
Europe Is Crumbling Into Economic Collapse - 2nd Oct 14 - Raul_I_Meijer
Gold Stocks Stealth Rally - 2nd Oct 14 - Gary_Tanashian
U.S. 30 Year US T-Bonds Voodoo Analysis - 2nd Oct 14 - Austin_Galt
Top Approaching in Berkshire Hathaway Stock? - 2nd Oct 14 - EWI
Stocks Interesting, Junk Bonds at Fair Value, Bill Gross Who Cares? - 2nd Oct 14 - David Tepper
Gold Will Surprise In More Ways Than One - 2nd Oct 14 - Bob Loukas
“Back Door” Method For The Government To Pay Down The Federal Debt Using Private Savings? - 1st Oct 14
Dow Stocks Index And The No Mercy Cycle - 1st Oct 14
Why China Thinks Gold is the Buy of the Century - 1st Oct 14
Forex Volatility Predicts Bottom in Gold and Silver? - 1st Oct 14
Stock Market Wil-e-Coyote Moment May Have Arrived - 1st Oct 14
Europe Teetering the Ddge of a "Japan-style" Deflation - 30th Sept 14
Economists Economic Atonement - 30th Sept 14
Everything You Need to Know About the Stock Market S&P Index Until Christmas - 30th Sept 14
Singapore Becoming Global Gold Hub - Launches Kilo Bar Contract And Gold ATMs - 30th Sept 14
Germany Fights on Two Fronts to Preserve the Eurozone - 30th Sept 14
Turn the Tables on the Gold and Silver Market Manipulators - 30th Sept 14
U.S. 2014 Election Business as Usual - 30th Sept 14
Gold - Time to Buy the Dip? - 30th Sept 14
Urging Investors to Stay Liquid for the Coming Gold Stocks Boom - 30th Sept 14
The Japanese Deflation Myth and the Yen’s Slump - 29th Sept 14
Epic Investor Optimism that Can Be Reversed Only by a Huge Stocks Bear Market - 29th Sept 14
Russia’s Gokhran Buying Gold Bullion In 2014 and Will Buy Palladium In 2015 - 29th Sept 14
The End of Monetary Policy - 29th Sept 14
Here's What Rising Interest Rates Really Do to Your Shares - 29th Sept 14
Is a Credible Stock Market Top Forming? - 29th Sept 14
Silver Price At or Very Close to an Important Low - 29th Sept 14
Gold Price Very Close to an Important Low - 29th Sept 14
Nihilism And The Unknown Future - 29th Sept 14
Stock Market S&P, NAS Change In Trend? None Apparent, But A Caveat - 29th Sept 14
UK Saved From I.S. Threat But Scottish Independence Nightmare is Not Over! - 29th Sept 14
U.S. Aggression - Will Russia and China Hold Their Fire? - 28th Sept 14
Currency Wars and the Death of the Euro - Audio - 28th Sept 14
Obscure Maritime Law Practically “Guarantees” Profits for These Energy Companies - 28th Sept 14
Stock Market Primary IV Underway? - 27th Sept 14
Darwin And The Climate Apocalypse - 27th Sept 14
The Global Middle Class and Copper Consumption, A Stop Spike Event - 27th Sept 14
Can Money Save The Climate? - 27th Sept 14
Gold And Silver - PetroDollar On Its Deathbed? PMs About To Rally? No - 27th Sept 14
Debt and Inflation Consquences of American Fear - 27th Sept 14
U.S. and Global Confidence are in Divergence - So Are Stock Markets - 27th Sept 14
Are U.S. Cars About to Crash? - 27th Sept 14
Why the U.S. Created and Armed ISIS From Libya to Syria - 27th Sept 14

Free Instant Analysis

Free Instant Technical Analysis


Market Oracle FREE Newsletter

The Most Exciting Event in the History of Technical Analysis

We’re in a Recession Right Now

Economics / Double Dip Recession Sep 29, 2011 - 12:00 PM GMT

By: Trader_Mark

Economics

My posts today seem to have a Negative Nelly tone - I am looking very hard for some positive stories to offset what I'm posting. ;)

WSJ's Dealbook has an interview with one of the smartest men in the room - Doubeline's Jeffrey Gundlach.  Many would consider this guy the best bond investor on planet Earth, alough PIMCO's Bill Gross gets all the press.  His Total Return Fund is once again smacking its index year to date. 


Gundlach believes the U.S. is in recession right now - I'll wait for the ECRI to confirm, but the bigger picture is, no matter if 'official' GDP is -1% or +1%, that does not matter much for economic prospects.  This economy needs to be moving at 3%+ for quarters on end to truly have any serious impact on the lives of most Americans.  At best we're at muddle through speed, despite massive stimuli. More from Gundlach:

  • The country is already in a recession, according to bond manager Jeffrey Gundlach, who predicted “there’s going to be a big loss in Europe.”  The much-watched head of Los Angeles-based DoubleLine Capital addressed a crowd of roughly 100 financiers and reporters at the New York Yacht Club this afternoon.
  • Gundlach reinforced his often dark views about the status of the U.S. economy and future for Europe. “We’re in a recession right now,” Gundlach said, as he reviewed a hefty deck of slides with dreary data. Statistics on the polarization of wealth in the U.S., dim headlines about sentiment in locales abroad and the European bond market were among the reasons Gundlach cited for his dour forecasts.
  • Echoing the sentiments of many money-managers, Gundlach said that the Eurozone is bound for problems. “I don’t know what is going to happen,” he said. “But I think there is going to be a big loss in Europe.” DoubleLine has no investments in Europe, he said.
  • He then flashed a chart of 10-year sovereign debt spreads for the so-called “PIIGS” (Portugal, Italy, Ireland, Greece, Spain) and circled their recent spike in red. Next to the spike he wrote “These are crashes, why no understanding of that?” in red ink. Greece’s spreads showed signs of woe as far back as February 2010, he said.
  • As for what’s ahead in the United States, Gundlach pointed out that the rally in the municipal bond market was helped by many states not having a choice but to balance their budgets.  However, that may mean that “the man on the street thinks it’s a depression,” he says, as many local governments have slashed jobs, cut down hours for public resources and stalled projects.  He pointed to the closing of bathrooms near his home in Southern California as an example. “You can’t go to the beach and drink your lemonade because there’s no bathroom,” he says.
  • DoubleLine’s strategy has no exposure to Europe, Gundlach says, and is entirely denominated in dollars.
  • The bets have paid off so far. The DoubleLine Total Return Fund is up 8.76% year to date, according to Morningstar Inc., compared to a 2.52% increase in the Barclays Aggregate index.

By Trader Mark

http://www.fundmymutualfund.com

Mark is a self taught private investor who operates the website Fund My Mutual Fund (http://www.fundmymutualfund.com); a daily mix of market, economic, and stock specific commentary.

See our story as told in Barron's Magazine [A New Kind of Fund Manager] (July 28, 2008)

© 2011 Copyright Fund My Mutual Fund - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2014 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Free Report - Financial Markets 2014