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"To
raise interest rates when junk bonds are nearly at a four-year
low is a bad idea," Gundlach said in a telephone interview.
Gundlach, widely followed for his prescient investment calls,
said if the Fed begins raising interest rates in September, "it
opens the lid on Pandora's Box of a tightening cycle."
Gundlach said the selling pressure in copper and commodity
prices driven by worries over China's growth outlook "should be
a huge concern. It is the second-biggest economy in the world."
Last year, Gundlach correctly predicted that U.S. Treasury
yields would fall, not rise as many others had forecast, because
inflationary pressures were non-existent and technical factors,
including aging demographics, were at play.
The Los Angeles-based DoubleLine Capital had $76 billion in
assets under management as of June 30.
The DoubleLine Total Return Bond Fund, DoubleLine's largest
portfolio by assets and run by Gundlach, had positive inflows in
July.
The Total Return fund attracted a net inflow of $390.4 million
last month, compared with $81.7 million in June. It has $47.2
billion in assets under management and invests primarily in
mortgage-backed securities.
(Reporting by Jennifer Ablan; Editing by Lisa Shumaker)
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