Last week, DoubleLine Capital CEO Jeff Gundlach triggered headlines when the famed investor said he was buying puts on the S&P 500. While we obviously respect his investing track record, we have disagreed with Gundlach since mid-November.
As we pointed out in May:
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“Shortly after Election Day, Gundlach expressed a skeptical view of the U.S. economy. He called Technology stocks “expensive.” “The Trump win is not positive for consumer spending,” he said. “It's way late to be selling bonds and buying stocks. Probably should be doing the opposite." |
Meanwhile, the U.S stock market (expensive tech stocks in particular) continue to notch new all-time highs on strong earnings and accelerating growth.
For the record, we still respectfully disagree with Gundlach’s market calls.
The U.S. economy has rallied to 2.1% year-over-year in the second quarter of 2017, from the low of 1.2% year-over-year hit in 2Q 2016. We think the economy continues to head higher from here.
“If you think Gundlach could be wrong, just think about all the other people who are far less impressive than Jeff Gundlach,” Hedgeye CEO Keith McCullough said recently on The Macro Show. “They have failed to acknowledge that GDP bottomed and then accelerated, inasmuch as profits have. And that’s a big part of what’s going on out there.”
For the record, here is a collection of recent Gundlach market calls…
