It’s Fed day, which means everyone and their sister will be watching to see what Janet Yellen does and says this afternoon. But in the long term, does it really matter? I’d argue the answer is “No,” and I’m not alone.
In a damning interview and presentation late yesterday, DoubleLine Capital CEO Jeffrey Gundlach said: “Central banks are losing control and they don’t know what to do. The Fed is confused and their confusion spills into investor psychology. The Fed changes its tone so frequently, it seems every other week the message is different. They’ve turned into the ‘Zombie Fed.'”
DoubleLine isn’t some fly-by-night, two-bit firm. It manages more than $100 billion in assets, and is one of the biggest players in the bond market. Gundlach’s comments follow by a few days of warning from bond guru Bill Gross. He said negative interest rates are creating a “supernova that will explode one day.” When asked what financial assets were overvalued right now, he said “all” of them.
Sooooo not big Yellen fans then, eh?
