In a conference call today, the new bond King (fuck B. Gross) laid waste to the Fed and other central banks, mocking the Fed for calling the June meeting a live one– besmirching them as zombies.
Moreover, the negative rate experiment is going very poorly wherever implemented, backed up by massive drawdowns in global markets from the highs.
Does any one disagree?
A great man once said ‘it’s gonna be a hot summer.’ An even greater one just said the summer will be one of the rocky varietal.
“Central banks are losing control and they don’t know what to do … just like the Republican establishment and Donald Trump,” Gundlach told Reuters in a telephone interview, referring to the Republic Party’s unpredictable presumptive nominee for U.S. President.
“The Fed is confused and their confusion spills into investor psychology,” said Gundlach, who oversees more than $100 billion at Los Angeles-based DoubleLine.
“The Fed changes its tone so frequently, it seems every other week the message is different. They’ve turned into the ‘Zombie Fed.’ They say the meeting this week is ‘live,’ but investors all know it isn’t at all.”
Gundlach said it is a “dangerous price appreciation game” to purchase German Bunds at current levels and that gold and gold miners are still an attractive place to put money to work.
On a webcast for investors later on Tuesday he said negative interest rates implemented by some major central banks, notably in Japan, were backfiring. “Negative interest rates don’t do what they’re theoretically supposed to do,” he said, noting the appreciation in the Japanese yen.
He added that negative interest rates “aren’t leading to higher economic growth.” He said world gross domestic product could be averaging around just 1 percent against the backdrop of aggressive global monetary policies.
Gundlach also noted the dramatic “drawdowns” from the highs in several stock markets. Germany is down 22 percent, Japan is down 23 percent, China is down 45 percent, the United Kingdom market is down 15 percent and France is down 20 percent.
“Negative rates do not prop up stock markets,” Gundlach said on the webcast.“This summer is going to be a rocky ride,” Gundlach said, summarizing his outlook.
Go buy some Chinese stocks you degenerates.
If you enjoy the content at iBankCoin, please follow us on Twitter
It certainly seems that negative rates are not encouraging spending, but what is a logical explanation for why this is true?
Negative rates are such a sign of desperation that even the common plebes feel something’s ahead and it ain’t good.
Now if you are pretty certain a hurricane is beelining for your property are you going to empty the toll on a bunch of brand new furniture, appliances and other assorted crap? Probably not. Instead most will hoard as much cash as possible and hope it lasts long enough to see better days.
Thanks Pimp. What you said makes sense to me.
Theyve been circling/enacting/staging ZIRP/NIRP for 90 months, 100 months 105 months something like that. Public is so beyond clueless and a little “late to the party”
Central banks need to tell governments that monetary policy has done all it can do and is in the land of gimmicks. The next trick is helicopter money drops. Fiscal policy has to step up.
we …(are.. are we?) fkd???