Jeffrey Gundlach: Ready, Aim, Aim, Aim, Aim | CNBC

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DoubleLine CEO-CIO Jeffrey Gundlach joins CNBC’s Scott Wapner following Federal Reserve Chairman Kevin Warsh’s latest Federal Open Market Committee press conference, and Mr. Gundlach’s takeaway is that the Fed is stuck in a loop on rates of “ready, aim, aim, aim, aim,” with the trigger never pulled. With energy prices up sharply, his inflation model has headline CPI starting with a 4 for the next several months. The U.S. Treasury yield curve steepened during the press conference, which Mr. Gundlach reads as the long end voting against a Fed that is slow to act. “I don’t understand why the Fed is so reluctant to move,” he says, setting a December hike as the base case.

Mr. Gundlach says financial conditions are tightening because the market is doing it, not the Fed, with spreads widening on weaker credit and a crisis of confidence in the ratings on AI-related bonds that trade like junk soon after they’re issued. He compares the mood to subprime in 2006 and 2007, calling it “the beginning of a trend, not just a bump.” He points to the deficit as more pressure on rates, with the national debt up about a half-trillion dollars in two months, and he wants no part of “the epicenter of the blast radius of the AI problems” in cap-weighted equity indices. He closes on a lighter note about the Fed’s move to fewer meetings, recalling the days when a bell rang on the ticker-tape machine and rates changed out of the blue. He wouldn’t mind a return to that.

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DoubleLine Capital LP

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DoubleLine has been managing money for insurers since its inception in 2009. The firm's focus on securitized fixed income and risk management positions it well to manage money for insurers. The firm offers an array of fixed income strategies including dedicated ABS, private ABF, CLOs, infrastructure debt, non-QM, commercial and residential loans, multi-sector fixed income and EM. We understand that the needs of each insurer can vary, and our insurance team is focused on providing our clients with unparalleled access to the investment team and creating custom solutions to meet their distinctive objectives. DoubleLine wants to be your fixed income partner.
 

Paul Schroeder, CFA   
Relationship Manager- Insurance  
paul.schroeder@doubleline.com
Direct: 213-372-3123
Main: 813-791-7333
 

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