Here’s a great interview at Yahoo Finance with Jeffrey Gundlach, CEO of DoubleLine Capital in which he says US stocks will be crushed in the next recession. He also says that there is currently a forty per-cent chance of a recession in 2020. Here’s an excerpt from the interview:
My belief is if that pattern will repeat itself. In other words when the next recession comes the United States will get crushed and it will not make it back to the highs that we’ve seen, that we’re kind of floating around right now, probably for the rest of my career. Is what I think is going to happen.
Now my career doesn’t have 30 years to go but it also doesn’t have a year or two to go. So I think that there’s going to be a rotation into non-us stocks. The dollar is going to be weak. The dollar has been very stable this year. It’s really remarkable the DXY index. The DXY started this year at 96 and a quarter and today it’s a 97 handle. So it’s been remarkably stable.
I think in the next recession the dollar will fall because of the deficit problem in the United States and investors will be better served to own foreign stock markets instead of the US stock market in dealing with the next recession.
You can watch the entire interview here:
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