Uno che ne capisce

Anticipiamo nuovamente la pubblicazione dei nostri Post, rispetto alla consuetudine, in ragione della possibilità di eventi inattesi durante il weekend 7-8 marzo 2020.

Nei momenti di confusione, sui mercati come in ogni altro campo della nostra vita, è utile ascoltare ciò che dice uno che ne capisce.

Che poi vuole dire ascoltare chi ha sia l’esperienza sul campo, sia le basi della conoscenza, necessari per decifrare, nei momenti nei quali prevale il caos, ciò che è importante da ciò che è soltanto confusione che genera altro caos.

Noi di Recce’d abbiamo da questo punto di vista riferimenti precisi, e molti ve li abbiamo presentati, nel corso degli ultimi 10 anni, proprio qui nel Blog.

Uno di questi è il gestore Jeff Gundlach, che ha rilasciato nel corso della settimana l’intervista più significativa, tra le poche interviste significative (e decine di migliaia di insulse) che abbiamo ascoltato.

Potete leggere qui sotto una sintesi, che mette in evidenza i passaggi più importanti. Oppure, potete rivedere per intero l’intervista cliccando su questo link.

L’intervista aiuterà i nostri lettori a comprendere perché, mentre questa settimana l’attenzione di tutti i media e di tutti i promotori finanziari era concentrata sugli spettacolati alti-e-bassi di Wall Street, in Recce’d abbiamo speso i giorni e molte ore della notte a … occuparci di altro.

No, non siamo andati a passeggio, e neppure alla Beauty Farm. Abbiamo lavorato per i Clienti.

Ma non sulle Borse: in quel comparto, si è avviato un processo le cui cause e le cui prospettive Recce’d ha ben chiare, e di cui abbiamo anche scritto in numerose occasioni.

Oggi Recce’d si occupa di preparare i propri portafoglio, e quindi quelli dei nostri Clienti, a ciò che verrà dopo i fatti di Borsa di queste settimane.

Abbiamo fatto, e rifatto, e poi ancora rifatto, tutti i conti: le valutazioni, i rendimenti attesi, i rischi in termini di possibilità di calo dei prezzi.

In particolare, abbiamo cercato di individuare quali categorie di asset, e quali categorie di operatori (e prima di tutto, quali famiglie di Fondi Comuni di investimento) sono destinati a pagare il conto di questo andamento tumultuoso dei mercati finanzia.

Proprio di questo parla Gundlach nell’intervista che vi offriamo. Noi per i Clienti ne scriveremo ogni mattina, la settimana prossima, in The Morning Brief.

"The bond market is rallying because The Fed has reacted the seizure in the corporate bond market - which is not getting enough attention."

That was the sentence that sparked a chin hitting the table moment for anyone watching DoubleLine CEO's Jeff Gundlach being interviewed on CNBC today. Until now, amid all this equity market carnage, various talking heads - who clearly are not 'in' the bond market - have confidently claimed 'yeah, but it's different this time, there's loads of liquidity and credit markets are not showing any signs of pain'... Well that all changed today as the world was told the truth.

Credit spreads have exploded wider in recent days... "the junk bond market is widening out massively..."

Gundlach noted that Powell's background in the private equity world - rather than academic economist land - has meant that his reaction function is driven by problems in the corporate bond market as "this will be problematic for the buyback aspect of the stock market."

The Fed cut rates, he added, "in reaction to even the investment being shutdown for 7 business days."

So the DoubleLine CEO said that Powell "cutting rates was justified" but didn't like the way it was done as it signaled "panic."

The reason for his disdain is clear:

"The Fed in their most recent press conference, took a victory lap, talking about how they had finally reached a stable place in policy and that they could be on hold for the foreseeable future, maybe even the entire world. That we are in a good place. That policy rates were appropriate. And I don't know, I thought it was a little bit of hubris at this time."

And reminds watchers that historically, "when The Fed has cut 50bps in an emergency intra-meeting such as this, they typically cut pretty quickly after once again."

And sure enough the market is already pricing in another 50bps cut at the March meeting...

However, unlike Guggeheim's Scott Minerd - who sees 10Y yields at 25bps - Gundlach believes "we are pretty near the low right now...maybe we get to 80 basis points on the ten year."

Well we are at 85bps now...

However, while his view is that long-rates are starting to floor, he notes that "short rates are definitely going lower. There is absolutely no upward pressure on short rates."

Gundlach agrees with Jim Bianco that short-rates are going back to zero, but stopped short of expectations for negative rates:

"I think Jay Powell understands that negative rates are fatal to global financial system. If we go to negative rates, there will be capital destruction en masse."

But more easing is coming, as Gundlach reflects on those calling for v-shaped recoveries:

"I think it is foolhardy to think anything other than this [pandemic] is going to take a major hit to short-term economic growth."

His perspective on the financial and societal impact of the Covid-19 pandemic is refreshingly honest on CNBC:

"...obviously, the airlines are in free fall for good reason. And small business activity is going to contract. Maybe grocery store sales will go up on a short-term spike. But all other kind of social activity is grinding to a standstill."

Warning that "the two sectors that are just falling knives are financials and transports. And I don't see anything that's going the reverse that until we get through the other side this valley of this sort of travel shutdown."

Finally, Gundlach ends on an even more ominous note:

"...the President and the physicians, on top of this coronavirus situation, and they are saying that they might have a vaccine in like a year, year and a half.

So, nobody knows what is happening here. And so, caution is appropriate."

So no more buy the dip?

As former Dallas Fed President Richard Fisher noted, that means a generation of money-managers are about to losae their security blankets!

And that's why Gundlach is long gold:

"I turned bullish on gold in the summer of 2018 on my Total Return webcast when it was at 1190. And it just seems to me, as I talked about my Just Markets webcast, which is up on DoubleLine.com on a replay, that the dollar is going to get weaker.

And the dollar getting weaker seems to be a policy. And the Fed cutting rates, slashing rates is clearly going to be dollar negative. And that means that gold is going to go higher."