It appears that Jeff Gundlach was right when he said, “Bill Gross Is Early” on his bond bear market call.
Reminding his audience of the rivalry between himself and Bill Gross, Gundlach disagreed with the former bond king, who made headlines today with his statement that the bond bull market is over, and said that “Gross is too early with his TSY bear market call.” What is the catalyst for Gundlach? As he explained, one “needs to see the 30Y at 2.99% or above for the trendline to break.“
And now, Janus Henderson tweeted this…
Gross: There is a level on U.S. 10yr Tsys above which stocks and economy are negatively affected because corporations are highly levered. 3.25% is a close estimate. Expect a Hibernating Bond Bear Market for 2018: 2.80-3.25% range.
Following Bill Gross’ appearance on Bloomberg where he appears to throw in the towel – for 2018 at least – on the bond bear market.
As Bloomberg reports, billionaire bond investor Bill Gross now believes most of this year’s excitement in the Treasury market is behind us and yields won’t see a substantial move from here.
“Supply from the Treasury is a factor in addition to what the Fed might do in terms of a mild, bearish tone for U.S. Treasury bonds,” Gross told Bloomberg TV.
“I would expect the 10-year to basically meander around 2.80 to perhaps 3.10 or 3.15 for the balance of the year. It’s a hibernating bear market, which means the bear is awake but not really growling.”
Which leaves speculators with a record short position now wondering who will be the one holding the greatest fool bag by the end of the year…