DoubleLine executive chief Jeffrey Gundlach, who is known as the "new debt king," said on Tuesday that US economic growth appears to be "completely" dependent on public debt, corporate bonds and mortgage-backed bonds, if it has increased trillions of debt, the US economy It should have been shrinking.
"If US public debt does not increase, the name of the past five yearsGDPThe increase will be negative," Gandrak said. "When everyone looks at these GDP data, it seems to ignore one thing - they don't seem to understand that the seemingly good GDP growth actually depends entirely on debt. Public debt, corporate bonds, and even mortgage-backed bonds have grown. ”
If the US Treasury does notAdditional issuanceBonds, then nominal GDP will be negative for three years in the past five years, “even during this period mortgage-backed bonds, corporate bonds and student loans have grown,” Gondrak said in an email to Reuters after a live webcast. Said. “If these non-public debt liabilities do not increase, the degree of GDP contraction will be large.”
Gundlach pointed out that nominal GDP increased by 4.3% in the past five years, but total public debt increased by 4.7%.
Gondrak said that in the context of this debt, and the financial market “has been addicted to the Fed’s stimulus policy”, this is a “very, very dangerous period” for the next US recession. Gundlach manages more than $130 billion in assets at DoubleLine Capital.
Gondrak said that although the United States will not move towards a recession soon, the US economy shows some weaknesses. He cited the Citi Economic Data Change Index, which has fallen to its lowest level since the financial crisis.
Gandrak said that the US stock market and the bond market are heading for shocks, and he is doing more gold with "confidence." He said that he has been making more gold since the beginning of $1,190. The price of gold will rise to $1,300 per ounce.
(Article source: Global Forex Network)