When last we checked in on Jeff Gundlach, keeper of the Twitter “truths”, he was busy crashing the S&P during an ill-conceived interview with CNBC’s Scott Wapner who sat idly by as a man who showed up at Sohn dressed in a Jack Nicholson Joker costume forcibly injected markets with an absurd dose of doomsday hyperbole.
For those with a short memory, recall that the sudden lunchtime swoon shown in the S&P futures chart below was Gundlach’s Christmas gift to the investing public, delivered early on December 17:
That landed Jeff in an absurd feud with Jim Cramer who, on air, advised Gundlach to “stick to bonds.”
Cramer would later apologize for being “intemperately critical “. The apology came after Gundlach effectively boycotted CNBC via tweet.
So sad that appearances on CNBC are now a thing of the past. It was great while it lasted. Blame it on Cramer. We’ll be on Fox Business.
— Jeffrey Gundlach (@TruthGundlach) December 21, 2018
Yes, “blame it on Cramer”, because Jeff would never do anything “intemperate” towards Cramer like, say, make up a childish nickname for him and Joe Kernen.
Paging Donald Trump: your patented Twitter cadence is being misappropriated.
In any event, Jeff is a cartoon character – plain and simple. For anyone who might be new to these pages, allow me to quickly reiterate why we give him such a hard time. To wit, from our recap of his last webcast:
I guess I wouldn’t be so hard on Jeff were it not for how incorrigible he is and were it not for the fact that he has an extremely pernicious habit of showing up on TV and basically just rehashing what’s been going on, only in an overtly condescending tone.
Every, single time he’s on CNBC it feels like you’re watching the news only with an anchor who is talking down to you and otherwise berating you for no discernible reason.
So there’s that, and then there’s his Twitter account which, in case it isn’t clear enough from the above, is basically what you would get if Donald Trump ran a giant bond fund.
Well, unfortunately, Jeff held his annual “Just Markets” webcast on Tuesday and because people are morons, it’s grabbing headlines despite Jeff having said absolutely nothing that is in any way, shape or form unique or otherwise insightful.
Among the “highlights” (if that’s what you want to call them) are Gundlach reiterating that the U.S. national debt is a “horrific situation”, which, in addition to being common sense, is just a rehashing of his “suicide mission”/’death wish” characterization from last year.
As is customary, he also spent some time describing what’s been going on across markets in case you’re having trouble using Google or else tried to deliberately overdose on barbiturates washed down with Old Crow after hearing Jeff predict the apocalypse last month and are just now waking up.
“[Jerome Powell] staged a full capitulation” last week, Gundlach reports, adding that “he went from pragmatic Powell to Powell put and the markets have been throwing a party since then.”
Jeff also suggested that the US government shutdown is contributing to investor angst at just the wrong time, another example of his penchant for stating the obvious and breaking two-week-old news during a live webcast.
And listen, don’t you think for a second that Gundlach didn’t offer up the usual set of “predictions” that, to someone who didn’t know any better, sound a lot like some guy stating the obvious.
For example, Gundlach said that “if the dollar weakens, gold will break upward” and he also said “the yield curve could steepen in 2019.” These are things you wouldn’t have known had Jeff not told you, ok? Ok.
On emerging markets, Jeff says it’s time to buy them “relativistically,” a hilarious attempt at profundity that feels just as forced as that time back in November when he rolled out “copacetic” to convey the notion that markets are too sanguine about BBB risk. If I had to make an assessment as to whether Jeff actually knows how to use the word “copacetic” in a sentence based on that November Reuters interview, I guess I would describe his grasp of big words as “relativistic”.
On EM, the bottom line is that if you think the dollar has likely peaked along with US growth, developing nation equities are likely to outperform their US counterparts. It’s not complicated and indeed, the convergence has already started to play out.
Jeff also delivered a warning on high yield, describing junk spreads as “starting to look like recession”. Of course junk has staged a monumental rally over the past three sessions and when I say “monumental” I mean this:
That recent strength, Gundlach says, should be seen “as a gift”. As for what you should do if you’re still in junk bonds, Jeff says you should “get out of them” in favor of companies with strong balance sheets. That’s probably a decent suggestion although, again, I’m not sure he’s saying anything that everyone didn’t already know.
Finally, for good measure, Jeff says Bitcoin could “easily” make it to $5,000 this year. Hilariously, Bloomberg credits Gundlach with having “rightly predicted [Bitcoin] would fall last year.” That’s technically true, but it’s about like “rightly predicting” that Donald Trump will say something crazy during the course of an hour-long press conference. It’s a guarantee and you needn’t possess any kind of specialized knowledge to know it.
That, for me anyway, is more than enough Gundlach for one day. And really, it’s more than enough Gundlach for a whole year, but you can bet you’ll hear from him again in “relativistically” short order, if not on TV, then in a Reuters interview or on Twitter where the masochists among you can follow Jeff and subject yourself to his random musings about everything from WSJ conspiracies to the Buffalo Bills.