Gold Price Set To Bounce, The Decline Is Done

(March 15th, 2021 - Dhwani Mehta)

Jeffrey Gundlach, Wall Street's bond king and Founder and Chief Executive Officer of DoubleLine, expressed his take on gold prices, given the disappointing performance so far this year.

"Gold went down to $1,681 on Monday on the close. That might be low in gold for a while.”

"Certainly, that looks like it has been the right call," referring to his neutral call on gold when it was above $1800.

"Gold has really underperformed other froth assets like bitcoin by incredible amounts, almost inconceivable amounts since that peak in gold above $2,000.”

"Long-term gold is pretty interesting. Our model shows that gold is at fair value at $1,761.”

"We don't think the decline in gold is likely to continue."

"Gold is very likely to bounce because the selloff has been pretty powerful."

"The Fed chooses to be unconcerned about a period of time with inflation running above 3%.”

"In my opinion, not only are they unconcerned, they welcome inflation being higher than interest rates. They like negative interest rates because they know that negative interest rates help to forestall the incredible deficit and unfunded liability problems the United States has."

“One could actually plausibly predict that headline CPI could go over 4% at some point in about four months from now," which would "really spook" the bond market.