#352 Jeffrey Gundlach: Private Credit Is An Unmitigated Disaster, And It’s Only Going To Get Worse

Legendary bond investor Jeffrey Gundlach, founder and CEO of DoubleLine Capital, makes his debut on The Julia La Roche Show for a wide-ranging conversation on the most pressing risks facing investors in 2026. Gundlach makes the case that we are living through a fundamental regime shift — one where the next recession brings rising long-term interest rates and a falling dollar, the exact opposite of what most investors expect. He breaks down why the private credit market is shaping up to be the defining financial stress of this cycle, drawing parallels to subprime in 2006 and revealing just how opaque and potentially dangerous the marks in that market really are. He also shares his current asset allocation, explains why American investors should have 100% of their equity exposure outside the US, and lays out two scenarios — dollar debasement or outright debt restructuring — for how America's unsustainable fiscal path eventually resolves. Plus: why he's avoiding general obligation munis in California, Illinois and New York, where gold goes from here, and his non-consensus prediction for the next presidential election.

Links:

Website: https://doubleline.com/

YouTube: https://www.youtube.com/@DoubleLineCapital

X: https://x.com/truthgundlach

Economist op-ed: https://www.economist.com/by-invitation/2024/12/13/americas-debt-cannot-keep-stacking-up-says-jeffrey-gundlach

Timestamps:

0:00 Introduction — Jeffrey Gundlach on the debt burden and why something has to give

1:33 Big picture macro: secular shift from falling to rising interest rates

16:00 The case for 100% non-US stocks

17:30 Gundlach's current asset allocation: 40% non-US stocks, 25% fixed income, 15% commodities, rest in cash

22:00 Private credit: why it reminds him of subprime 2006 and why it’s “a total unmitigated disaster"

38:00 The Fed follows the 2-year Treasury —  why the next Fed move actually be a hike?

42:30 Recession probability: at least 50% in 2026

47:00 Capital preservation mode: lowest risk positioning in DoubleLine's 17-year history

50:00 The gold call: from $2,915 to $4,000 and where it goes from here

53:00 The most dangerous force in investing: not fear or greed — need

56:00 California, Illinois, New York: avoid all general obligation munis

1:00:20 Wealth taxes, billionaire flight, and why it'll cost more to administer than it raises

1:01:00 Non-consensus prediction: three parties on the ballot in the next presidential election

1:02:00 The Fourth Turning reset — why 2030 is the timeline