Investment guru Jeff Gundlach reportedly has predicted that stocks will crash within the next year and a half as the dollar also tumbles in value.
"I do think that within 18 months it's going to crack pretty hard,” the billionaire investor known as the "Bond King" also said in a recent RealVision interview.
“When the next big meltdown happens, I think the U.S. is going to be the worst-performing market," the DoubleLine Capital CEO said.
Gundlach said he was "very, very negative long term on the U.S. 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," Business Insider quoted him as saying.
"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," he said.
Gundlach also said tech stocks like Apple and Amazon were the only U.S. equities worth owning.
"If you want to own U.S. 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," he said, advising people that they should own Apple, Amazon, and the other "big tech" stocks that have driven the market in recent years.
"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.”
However, other respected economic experts are much more optimistic about the nation's financial future.
President Donald Trump’s top economic adviser said Sunday the economy remains in “a strong rebound” even as Americans learn to “deal with” the coronavirus.
In an interview on CNN’s “State of the Union,” Larry Kudlow argued in favor of a new stimulus bill even as he praised the conclusion of medical experts that "focused protection" can get nation through the pandemic.
But, Kudlow added, a national economic recovery won't necessarily need a stimulus.
Kudlow was asked about Federal Reserve Chair Jerome Powell’s call last week for more government spending to protect the recovery.
“It’s just getting Americans through a difficult period of time,” Kudlow said. “I don’t want to parse, but I don’t think the recovery is dependent on it.”
The U.S. will post strong economic growth in the third and fourth quarters, he said, bouncing back from the historic dive in the second quarter.
“We are are in a strong rebound,” Kudlow asserted. “Lower taxes and lower regulations going way back are still in place and businesses are reopening.”
“We are learning to deal with the virus in a targeted safe preventative way. … some targeted assistance would go a long way right now,” he said.
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