Billionaire ‘Bond King’ Jeffrey Gundlach Predicts the Fed Will Cut Rates Substantially Soon
Uh oh, the time for interest rate cuts may soon be upon us! According to the renowned Billionaire ‘Bond King’ Jeffrey Gundlach, the Federal Reserve is likely to take action and cut the Federal overnight lending rate substantially in the near future.
The Bond King and his track record
First things first – who is this guy and why should we take his word? Well, Jeffrey Gundlach is widely known by his title as the ‘Bond King’ and his job is to understand the bond markets. And he’s been doing this well for many years, and his firm Doubleline Capital often seems to enjoy more returns than their peers.
According to Mr. Gundlach, there’s merit to the theory that the federal funds rate will drop significantly, and soon.
Gundlach stated that the Fed “tend[s] to move pre-emptively and a if your body language conveys desperation, you know what? You’re halfway there,” and he added that “right now, the Fed is desperate and will do whatever it takes to get the economy going again.”
What could this mean for us?
This means that the rate cuts could pave the way for cheaper loans for businesses, mortgages, and credit cards. And for those of us saving for retirement, it could mean higher returns on our investments.
Time To Get Serious
While there’s no guarantee that rates will actually drop as Gundlach predicts, we should take this seriously and begin preparing for the potential cuts.
Here are a few things to keep in mind:
- Consider locking in rates on a fixed-term loan sooner rather than later.
- If you’re saving for retirement in a taxable account, now may be a great time to get serious about your investments.
- If you’re sitting on a bunch of cash, it may be smarter to invest it before the rate cuts take place.
The Final Word
Bottom line, it looks like the bond king may not be wrong after all. It may be a good idea to start preparing for the potential rate cuts. Maybe Jeffrey Gundlach is right, and the big money might be calling!
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