I highly recommend watching this Jeffrey Gundlach interview on CNBC following the FOMC decision yesterday. He talks about his outlook for bonds, the economy, and the stock market in it.
In 2021, when so many people – such as Cathie Wood – believed that inflation was “transitory” and would go away Gundlach did not and adopted to the new reality while most continued to live in denial. He was not caught off guard when the market went into a bear market in 2022, because he was not one of those who just believes what he wants to believe.
He now believes that 1-2 year bonds are a great buy now, as he thinks we are at the peak of this Federal Reserve tightening cycle, however he also worries that we are heading for a funding crisis that will impact the bond market in the next few years.
He talks about buying corporate bonds and getting yields over 6% with them.
In the interview he says he thinks bonds and the stock market can rally over the next few months (despite their recent declines), but that rally could lead to another round of market turmoil when it comes to an end next year, with interest rates going lower by the end of next year.
That’s why he likes the idea of buying 1-2 year bonds now.
Personally, while I do think the market is likely to be ok into the end of this year, I’m looking for a long-term buy point before I buy much more stocks, like we saw last in the October, 2022 – January, 2023 time period.
That’s why I have done so few updates lately and am personally not doing much.
I explained what such a buy point would look like in a private Power Investor update last week (no we are not accepting any new members and have not for over two years).
I already have reduced my long exposure in the markets to around 20% and shifted the rest of that 80% into various CD’s and bonds, awaiting a good long-term buy point. Yes, I sill own the gold I bought last year in October/November.
This is the type of thing that is impossible to focus on with Youtube videos and get any kind of following – in fact people turn away from such videos and that behavior then tells the algorithms to not show them and then your channel gets degraded by Youtube. A generation of investors have been trained by crypto advertisers and Cathie Wood to only want to hear about getting rich quick.
I will never cater to those people and so have pretty much been walking away from the financial Youtube social media space and just doing occasional updates.
If you want to hear how you can get rich quick in the stock market watch don’t listen to me, instead watch people like this delivering the predictions the Youtube masses love to hear.
For more on my views: