(Business Insider) In a RealVision interview filmed on October 1 and released on Friday, the billionaire "Bond King" Jeff Gundlach said stocks would crash within 18 months, predicted that the US dollar would tumble in the long run, and voiced his doubts about bitcoin.
Gundlach, the founder and CEO of DoubleLine Capital, also called out Chipotle's valuation, criticized welfare, and argued that the only US equities that made sense to own right now were the largest technology stocks.
Here are Gundlach's 10 best quotes from the conversation, condensed and lightly edited for clarity:
1. "Valuation makes absolutely zero difference when you're in a true, brutal bear market. You just go to prices that you just can't believe." — on the tricky 1994 bond market and how it prepared him for the financial crisis.
2. "I'm actually long the dollar now, even though I don't believe in it at all. It's a good investment for the next five years." Gundlach added that he was "very, very negative long term on the US dollar" because of the ballooning budget deficit and the prospect of higher inflation, and that he sees betting against it as "the big trade for the years ahead."
3. "If I want it to invest for my great-great-great-great-grandchildren, I'm positive that certain real-estate investments and certain resource investments would be obvious winners. Who cares about your great-great-great-grandchildren?" — on the need for fund managers to balance the lower risks of a longer investment time frame with investors' impatience.
4. "If you want to own US stocks, you should own those six knowing that you're going to take a bloodbath if you overstay your welcome ... You've just got to have your finger on the exit button or pretty close by, but I think that's your only chance of making money." — advising people that they should own Apple, Amazon, and the other "big tech" stocks that have driven the market in recent years.
5. "The one that just blows my mind is Chipotle. I just can't understand why the stock has tripled over the last six months. It just baffles me. Isn't the price-to-earnings ratio like 150 or something? That's a lot of tacos."
6. "I do think that within 18 months it's going to crack pretty hard. When the next big meltdown happens, I think the US is going to be the worst-performing market." — predicting a stock-market crash that would be exacerbated by a weakening dollar.
7. "It's comical how people talk about modern monetary theory or universal basic income as some wacky idea. We've been doing it since the 1960s. What do you think welfare is? It's universal basic income, just for a certain subset of the population. It hasn't exactly solved the problems. In fact, in my view, it's made it much worse."
8. "I don't believe in bitcoin. I think that it's a lie. I think that it's very tracked, traceable. I don't think it's anonymous." Gundlach later added that he was "not at all a bitcoin hater."
9. "I prefer things that I can put in the trunk of my car. I prefer my Mondrian on the wall to a digital entry that has the same value." — on his preference for physical investments.
10. "It will be quite a pleasant experience to not be in the car on the first wheel of the roller coaster that's coming." — on his cautious approach to investing in anticipation of a crash.
