(Money and Markets) Billionaire “Bond King” Jeffrey Gundlach says the Democrats’ impeachment inquiry against President Donald Trump is nothing more than political “theatrics.”
“This is more theatrics than anything else,” Gundlach told Fox Business in an exclusive interview.
DoubleLine Capital oversees $140 billion in assets, and its CEO and Chief Investment Officer said he doesn’t expect the impeachment inquiry to have a big effect on markets.
“I don’t think it’s a real major market issue,” he said. “When it comes to politics, the outcome of the 2020 election is far more important than what will be an unsuccessful and probably not even fully realized impeachment sort of action.”
The impeachment inquiry, announced Tuesday by House Speaker Nancy Pelosi, D-Calif., will seek to prove that Trump was attempting to smear a potential 2020 presidential election rival, former Vice President Joe Biden, with the help of a foreign power, the Ukraine.
Trump of course denies the allegations and released a transcript of the call on Wednesday.
Markets sank a bit Tuesday after news of the impending announcement broke, which also coincided with a bit of sharp rhetoric toward China regarding the ongoing trade war during Trump’s speech before the United Nations General Assembly. The trade war shots Trump leveled at China are getting much of the blame for the market’s downturn that day.
Gundlach’s view is in line with the market’s previous performance surrounding the impeachment of President Bill Clinton. From the time Clinton’s affair with Monica Lewinsky first broke to the day he was found not guilty of perjury and obstruction in a swift Senate trial, the market rallied 31%.
With a Republican-controlled Senate highly unlikely to convict their president even if the House votes to impeach, Gundlach said the Democrats’ 2020 nomination is what is most important. Betting markets now have Massachusetts Sen. Elizabeth Warren is the favorite to win the nomination at 48%. Biden has an 18% chance and Vermont Sen. Bernie Sanders has an 8% chance, according to ElectionBettingOdds.com.
“If you look at the betting markets, Warren has by far the greatest chance for the nomination,” he said.
“There’s no way Joe Biden is going to be the nominee, there’s just no way,” Gundlach continued. “I’ve been asking people, ‘Do you know anybody that really supports Joe Biden?’ and I haven’t met a single person that says they know anybody that truly supports Joe Biden.”
Gundlach, who correctly said Trump would win the 2016 election, has been hammering the former vice president for months, often calling him “Sliden’ Biden” and “Jurassic Joe” on Twitter.
Gundlach also told Fox Business previously that Biden is nothing more than a “placeholder type of candidate.”
Gundlach said he doesn’t believe Warren has any chance of beating Trump in a general election because of the costly plans she’s pushing like Medicare for All — and getting rid of private insurance entirely — and tax hikes to pay for all her giveaways that will hammer the middle and upper classes.
“I don’t think you can go to 160 million Americans and say you’re going to get worse healthcare,” Gundlach said. “That the healthcare you have now is too good, and we need to take from you so that we can improve the lot of people that have inferior healthcare. I don’t think that’s a winning issue.”
As far as who would be worse for stock markets, Gundlach said Sanders would be a disaster, though, Warren wouldn’t be great.
“Elizabeth Warren comes across as less ideological, I think, and a little more pragmatic,” he said. “Bernie is just ideologically a communist. He got thrown out of a commune for being too lazy back when he was young.
“She keeps talking on and on and on about how corporations are going to pay, they’re going to pay, they’re going to pay for everything. So that sounds really bad for bottom-line earnings for large American corporations. But you haven’t seen it yet, so that tells me that there’s no coalesced opinion for what’s going to happen with Warren.”
