DoubleLine’s Jeff Gundlach hosted a Web seminar in mid-September titled, “Mirror, Mirror on the Wall,” a theme he’s trumpeted in a number of venues recently. No, it wasn’t another star manager waxing rhetorical to a demonic image in a foggy-looking glass, although with the size of the egos of some, you’re forgiven the thought. Rather, it dealt with the contrarian nature of the investing world in which we all currently reside, especially when compared with traditional models, sectors and assumptions.
The theme certainly isn’t new, as fellow fixed-income journeyman Bill Gross routinely notes with his concept of new normal. But the examples Gundlach gave brought into stark relief the notion of just how far afield we’ve gone.
“If you look into a mirror, obviously everything looks backwards,” Gundlach said, when explaining the title of the seminar. “It’s a way to get a very different view of the world and what’s happening in it.”
As an example, Gundlach noted that the discussion used to be about basket cases like Argentina and other developing countries, but he reminded listeners that developed countries are now the biggest debtors.
“Developing countries are now better fiscal stewards than developed countries, and this has played out in Europe.”