Doubleline’s Jeffrey Gundlach spoke with Reuters and one of the headlines was that 10-year yields could go to 1.00%. It raised eyebrows because just two weeks ago he reiterated that he thought 2.20% would be the bottom (spot at 2.21% today).
He qualified the statement by emphasizing on the could aspect of the statement and told CNBC it could happen if oil fell to $40.
In the Reuters story, he says:
“The 10-year Treasury could join the Europeans and go to 1 percent. Why not? The European rates are at 1 percent. France is below 1 percent right now,” Gundlach said.
I think anyone expecting yields to rise is playing a dangerous game. With Treasuries yielding more than Italian 10s, the dollar strengthening and inflation falling, there’s a compelling case to buy Treasuries even at low yields.
