Jeff Gundlach's S&P, Muni, TNX and Home Price Targets (DLTNX, DBLTX)

Jeff Gundlach, CEO of DoubleLine Capital LP (adviser to the DoubleLine Funds), was Barron's cover story this week. His DoubleLine Total Return Bond Fund (DLTNX/DBLTX) is up 17.36% since it launched in April 2010, outperforming competitors. He made interesting calls in the Barron's article.

DLTNX - DoubleLine Total Return Bond
In summary, Gundlach thinks the S&P "will hit 500 in the next couple of years", "expects home prices to fall by another 10% to 15%", and if there are muni defaults "there will be a panic at the margin, and muni bonds from the highest-rated on down will plummet". He's setting up a fund to scoop up distressed municipal bond funds at "40% of NAV". I wonder if Kyle Bass is doing the same. I'm going to check what muni-bond funds and ETFs own.

Regarding Treasuries, Gundlach said, "a renewed slowdown in the economy would drive 10-year bond yields sharply lower, but not below 3%, unless a banking panic similar to last year's euro-zone crisis ensues. Here is a link to Gundlach's January report.

DoubleLine's January 11, 2011 Report (via StoneStreetAdvisors)

DoubleLine Opens the DoubleLine Multi-Asset Growth Fund via Load and No-Load Share Classes (PR Newswire)