One of the hot stories making the financial page rounds today involves billionaire bond guru Jeffery Gundlach.
Gundlach was one of the few bond fund managers who called ahead of time the falling interest rate scenario that caught many off guard this year.
But Gundlach in an interview with the Financial Times wasn't looking back singing his own praises. He was scouting out 2020.
"A lot of things seem to be pointing to the year 2020 as an interesting time-frame," the Times quoted the founder of Double Line, the fund he started in five years ago from scratch that now controls $50 billion.
In short, what Gundlach apparently sees, given all the economic overhangs, from soaring federal deficits to aging populations to the Fed's maturing bond holdings, is what some might label as the second resurrection. In other words, a second round of more QE.
"It seems like one of the consequences of this zero interest rate policy is you've pushed out the problem of refinancing, of rolling over, but you've really compounded the magnitude of it and it seems to be focused around 2020."
In case you don't recognize it, in our view, this is another metaphor for the Piper. Kick the can is a great game, but the Piper has to be paid, one way or the other.
Another one Gundlach's points is the recent 4% second quarter number for the U.S. that MSM, as is their wont, went back-flipping over was bloated "by inventory stocking."
He noted he'd be surprised if 2014 U.S. GDP exceeded 2%
t. man hatter
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