Jeffrey Gundlach’s Top 10 Predictions for the Rest of 2022 | ThinkAdvisor

Portfolio

Economy & Markets

Portfolio Construction

Asset Managers

Investment VIPs

ETFs

Mutual Funds

Alternative Investments

Retirement Planning

Saving for Retirement

Retirement Investing

Spending in Retirement

Social Security

Financial Planning

Tax Planning

Trusts and Estates

College Planning

Charitable Giving

UHNW Client Services

Behavioral Finance

Practice Management

Building Your Business

Diversity and Inclusion

Marketing and Communications

Succession Planning

Compensation and Fees

Regulation and Compliance

Federal Regulation

State Regulation

Legislation

Litigation

Cybersecurity

Technology

Artificial Intelligence

Investment Platforms

Marketing Technology

RegTech

Life & Health Insurance

Life Insurance

Health Insurance

Annuities

Long Term Care Insurance

Running Your Business

LUMINARIES Awards

Event Coverage

Event Site

Newsletters

ThinkAdvisor

Jeffrey Gundlach’s Top 10 Predictions for the Rest of 2022

X

Share with Email

sending now...

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

Portfolio > Economy & Markets > Economic Trends

Jeffrey Gundlach’s Top 10 Predictions for the Rest of 2022

By Jeff Berman

News March 09, 2022 at 02:46 PM Share & Print

X

Share with Email

sending now...

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

Related: Jeffrey Gundlach’s Top 10 Predictions for 2022

Inflation could reach as high as 10% this year and it is crucial for the Federal Reserve to start hiking interest rates aggressively to slow it down, according to Jeffrey Gundlach, DoubleLine Capital CEO and chief investment officer.

It’s the Fed’s job to “fight inflation,” Gundlach said Tuesday in a webcast, adding: “They’ve done a terrible job of it so far. All they did was try to jawbone it down,” claiming it was just “temporary” and “transitory.”

Meanwhile, inflation has just gone higher and “that’s likely to continue as the inflation ‘convoy’ keeps rolling along,” the money manager said, referring to the Russia-Ukraine war and other market issues that continue to spur inflation.

Check out the slideshow above to view the top 10 updated predictions that Gundlach made on Tuesday, following his 2022 predictions in December.

At top: DoubleLine CEO Jeffrey Gundlach (Photo: Alex Flynn/Bloomberg)

Jeff Berman

NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

Up Next

A Look at Americans' Financial Health Across 3 Income Groups

View Story

More on this topic

9 Questions You'll Get at Holiday Parties in 2023

SEC Won’t Appeal Court Decision Paving Way for Grayscale Spot Bitcoin ETF

Bob Rodriguez: Stock Market ‘Delusional’; Hard Landing Ahead

Inflation Predictions Are Boosting Interest in This Asset Class

Jeffrey Gundlach’s Top 10 Predictions for the Rest of 2022

Exit

Exit

1. Inflation could approach 10% this year and will likely end 2022 at 7.5%.
With oil increasing to “over $120 a barrel and fertilizer prices exploding and natural gas in short supply,” among other current issues, “I think the inflation rate is not going to peak out” at 7.5% on the consumer price index during this year, according to Gundlach.

Depending on where the prices of commodities go, “I think we could be headed to a 10% CPI — certainly a 9% CPI before we get any relaxation,” he predicted. But he expects 2022 to end with about 7.5% inflation for the second-straight year.

(Image: Shutterstock)

Advertisement

Exit

2. The Russia-Ukraine war does not make it less likely that the Federal Reserve will raise interest rates.
“I completely disagree with” those pushing the narrative that the Russia-Ukraine war makes rate hikes cless likely, Gundlach said.

For one thing, if the inflation rate hits 9%, “I can’t possibly see how the Fed can pull back on interest rate increases,” he said.

(Image: Adobe Stock)

Exit

3. The Fed may raise interest rates as much as six times in the next two years.
The Fed has indicated it’s going to raise interest rates by 25 basis points at its March meeting, Gundlach noted. (Fed chair Jerome Powell also said he was ready to move more aggressively at a later date if inflation doesn’t start decreasing.)

“The Fed may raise rates six times — not necessarily this year but in the next couple of years,” Gundlach predicted.

(Image: Shutterstock)

Exit

4. U.S. consumer demand for many products will decrease due to higher energy and food prices.
The commodity price increases we have been seeing will create “demand destruction,” Gundlach predicted, noting “a lot of money is going to have to go to food and energy” at the expense of other items as prices, especially on gas, continue to soar.

(Image: Adobe Stock)

Advertisement

Exit

5. The U.S. dollar will decline in the near future.
The U.S. dollar index and yield curve have been “highly correlated,” Gundlach said. On a short-term basis, “one of the reasons I’ve been highly bullish on the dollar for the past nearly a year is because we thought the yield curve would flatten,” he noted.

When the yield curve flattens, in the short term, the U.S. dollar is supported, he went on to explain. But “we’re getting very near a flat yield curve,” he said, predicting the dollar will eventually “buckle” as a result of the U.S. budget and trade deficits.

(Image: Adobe Stock)

Exit

6. There could be another recession sooner than expected.
“We’re definitely getting more concerned about the potential for a recession,” Gundlach said.

When the U.S. dollar “finally buckles under the weight of the deficits,” that “might be the next recession,” he said, adding, “it might be coming sooner than we would have thought six months ago.”

Also, if we get an inverted yield curve, that has historically led to a recession, he reminded viewers.

(Image: Shutterstock)

Exit

7. U.S. stocks will start underperforming.
After the U.S. dollar buckles, we can expect to see an “even bigger convoy of stimulus coming at us, and I think that would probably be the time when U.S. stocks will start underperforming,” Gundlach predicted.

(Image: Shutterstock)

Advertisement

Exit

8. It will take a long time to get back to the Fed’s target of 2% inflation.
To even get to an average of 2% inflation, which is what the Fed has targeted, “to counter a couple of years of 7.5 [percent] inflation, you’re going to need many years of inflation of 1%,” Gundlach said.

(Image: Shutterstock)

Exit

9. Gold is probably a safe bet for long-term investors.
Gold has “started to shine” and may hit a new high, Gundlach said. But owning gold now does not make much sense on a short-term basis.

However, Gundlach said he didn’t see a problem with long-term investors owning gold if it fit in their portfolios.

“I own gold presently and I haven’t added to it in a long time but I do think that when the dollar falls, which will take the next recession, I think … gold will have a good purchasing power protection aspect,” he added.

(Image: Adobe Stock)

Exit

10. Commodities are a better investment than gold.
Broadly, commodities have outperformed gold, Gundlach said. Commodities are also better as an inflation hedge, he added.

(Image: Adobe Stock)

Choose your next slideshow ...

Exit

Slideshow

9 Questions You'll Get at Holiday Parties in 2023

Slideshow

13 States With Income Tax Cuts in 2024

Slideshow

COVID-19 Deaths Surge 15% in a Week

Slideshow

6 Ways to Find Common Ground With Wealthy Prospects

Dark Mode

Featured Resources
View All

From Schwab Advisor Services
Creating Your Own Formula for the Modern Office

Download Now ›

From Schwab Advisor Services
Freedom To Serve Complex Client Needs As An Independent RIA

Download Now ›

From Schwab Advisor Services
Advisor Case Study: Transitioning in a Pandemic

Download Now ›

From Addepar
The Risks in Risk-Free Assets

Download Now ›

Connect with ThinkAdvisor

About ThinkAdvisor Contact Us Advertise With Us Asset & Logo Licensing

Sitemap Terms of Service Privacy Policy

Copyright © 2024 ALM Global, LLC. All Rights Reserved.