Jeff Gundlach was on CNBC this morning offering his 2013 outlook. Here are some snippets:
- We’re in a range bound market in bonds. He says:
“On the positive side, we have rate repression by the Federal Reserve buying bonds which obviously keeps interest rates lower than they would otherwise would be, but on the other side in the treasury market, you have no value to speak of from an investor’s perspective.”
- There is no bond bubble. The year 2013 may be “building a credit risk bubble”. He says:
“The next move that I believe will start happening in the financial industry is that funds will start leveraging credit risk to a greater extent, which will build up an overexposure potentially should the market turn against bonds later on….in the near-term it’s a positive for the bond market.”
He provided 1 year total returns on various assets:
- 10 year t-bond: 3%
- S&P 500: 5%
- Laddered MBS: 6%
- High yield bonds: 6%
- Nikkei: 20%+
“Apple is in a consolidation period…I deeply believe though that Apple is headed to $425 a share. Not because I’m a bond guy or stock guy but because I’m a market guy. I’ve been around for a long time and I know that when something goes vertical like Apple did from $425 once the bubble pops it goes back down to the point at which it lifted off. And that’s about $425.”
See the full interview here:
Mr. Roche is the Founder and Chief Investment Officer of Discipline Funds.Discipline Funds is a low fee financial advisory firm with a focus on helping people be more disciplined with their finances.
He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance, Understanding the Modern Monetary System and Understanding Modern Portfolio Construction.