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Gundlach Warns "America's Credibility Is Slowly Eroding"

Tyler Durden's picture


Reflecting on the collapse of the USD, the surge in gold, the Chinese ratings agency downgrade, and the groundhog-day-like world in which the US government (and markets) live, DoubleLine's Jeff Gundlach warns that "America's credibility is slowly eroding." In his typical manner, Gundlach rapidly and efficiently covers a lot of ground in these brief clips; from the growing skepticism of the rest of the world towards the US' full faith and credit, to no end in sight for QE and reignition of bond inflows under an even more interventionist Yellen, to his views on Tesla, Google, and Apple.

On America's credibility (and growing skepticism around the world)...


On Fed Policy..


On US Stocks:


On US Bonds:


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Thu, 10/17/2013 - 15:03 | 4066152 Boris Alatovkrap
Boris Alatovkrap's picture

<-- USSA is already lose credibility

<-- MOAR QE is necessary

Thu, 10/17/2013 - 15:04 | 4066156 Cult_of_Reason
Cult_of_Reason's picture


Thu, 10/17/2013 - 15:06 | 4066166 LetThemEatRand
LetThemEatRand's picture

Yeah.  Hey Gundloch, 1980 is calling about that slowly thing.  

Thu, 10/17/2013 - 15:11 | 4066198 TeamDepends
TeamDepends's picture

Our research shows the US has indeed broken into a sprint downhill.

Thu, 10/17/2013 - 15:26 | 4066262 Manthong
Manthong's picture

Is this guy that twin brother Einstein was talking about in the spaceship nearing the speed of light whilst the other brother and the rest of us are here on Earth?

Thu, 10/17/2013 - 15:50 | 4066358 James_Cole
James_Cole's picture

Still loadin' up the truck with t bills though.

Thu, 10/17/2013 - 16:15 | 4066466 NotApplicable
NotApplicable's picture

Friday humor a day early this week, Tyler?

Thu, 10/17/2013 - 16:35 | 4066521 Keyser
Keyser's picture

Slowly eroding? Please, quit bullshiting us. America has no credibility left. 


Thu, 10/17/2013 - 15:09 | 4066186 Aeternus
Aeternus's picture

Uh huh, especially when we have mk ultraed stenographers raving about freemasons and satan on the house floor.

Thu, 10/17/2013 - 15:25 | 4066255 TeamDepends
TeamDepends's picture

Is it MKULTRA or does she simply have the firmest grasp of reality of anyone in the room?

Thu, 10/17/2013 - 15:41 | 4066320 the not so migh...
the not so mighty maximiza's picture

you know she overheard all the bribing going on

Thu, 10/17/2013 - 16:13 | 4066457 NOTaREALmerican
NOTaREALmerican's picture

Re:  raving about freemasons and satan on the house floor

When, in fact, it's the Lizard People who are behind all this.

Thu, 10/17/2013 - 15:32 | 4066249 Millivanilli
Millivanilli's picture

Credibility?  What bankster set of nuts did this jerkoff slide out of?  America under the Federal reserve is a nation underseige.  A country with this type of overlord is always predicated on fraud and a lack of credibility.   


Ask savers who float this system with their "investment" about ZIRP and credibility. Or a Inflation ripping apart their purchasing power? Or a system that tells them that Inflation is low?  All of which is designed to SAVE THE COCKSUCKERS who manipulate the markets, sell fraudulent securities, and rig rates.   


Hey buddy, buy these securities, they AAA.  Meanwhile, in the back of the house,  SHORT THOSE FUCKERS NOW.  In wing b of the investment bank they are laundering 1/3 of Mexico's gdp for Drug cartels.  None of which is prosecuted- FUCK YOU ERIC HOLDER>


Credibility. Seriously..



Fri, 10/18/2013 - 04:54 | 4068027 StychoKiller
StychoKiller's picture

I sense some hostility towards Banksters in you...

Thu, 10/17/2013 - 15:38 | 4066306 Nothing but the...
Nothing but the truth.'s picture

There's nothing slow about the erosion and the pace is accelerating rapidly. Dollar is doomed.

Thu, 10/17/2013 - 18:31 | 4066884 Exponere Mendaces
Exponere Mendaces's picture

Par for the course in the U. S. DUMB of A.

Idiocracy was right.

Thu, 10/17/2013 - 15:05 | 4066157 Dr. No
Dr. No's picture

Well appl is a "no brainer".  However, I interpret "no brainer" differently than the MSM.

Thu, 10/17/2013 - 15:36 | 4066291 Renewable Life
Renewable Life's picture

If you think Putin put an ass beating on Bammer on the Syria thing, wait until China finally makes a move on shit!!  I know their smart, so they'll propose some "duality" option, in which the world will have two options for its reserve currency, and may the best fiat win!

Which, given the reality of the shape we (USA) are in, will be a really funny development! But it will play into the "American exceptionalism" bullshit and instead of dropping bombs, we will think we can "compete" against them, rah rah the flag, etc! 

That way the dollar can drift slowly into the dustbin of history, instead of plummet!  But anyone with an IQ over 65 will know how that will end!

Which I susepct is why, the big banks have suddenly started to "limit" international outflows of dollars, because some big announcement is coming, I can feel it! Nothing happens for no reason! 

Thu, 10/17/2013 - 16:41 | 4066540 Keyser
Keyser's picture

The Chinese are looking at the big picture, unlike the US which cannot see beyond the end of their nose. The Chinese don't want to lose their $3+ trillion investment in US bonds, but they need a hedge. In comes the reason for their gold purchases, to hedge their US bond exposure. If the USD survives and the bonds pay out, so be it and they have lost nothing on their gold investment. If the USD implodes, gold goes parabolic and they still make money as the dollar dies. They have already stated that they do not want the Yuan to be the next reserve currency, but would defer to the SDR from the IMF for that role. 


Thu, 10/17/2013 - 15:05 | 4066159 Charles Nelson ...
Charles Nelson Reilly's picture

i thought we were told not to pay attention to bloggers or financial types?

Fri, 10/18/2013 - 04:56 | 4068028 StychoKiller
StychoKiller's picture

Hmm, I'm sorry, what were you typing again?

Thu, 10/17/2013 - 15:06 | 4066163 Calmyourself
Calmyourself's picture

Slowly, mine is compeltely gone.. What the hell is wrong with these slow learners?  Maybe the chemtrails are real they kill the common sense basic econ gene..

Thu, 10/17/2013 - 15:06 | 4066165 chunga
chunga's picture

Slowly? LOL!

I'm ashamed and embarassed at the shit that goes on every single day.

Thu, 10/17/2013 - 15:06 | 4066168 Big Corked Boots
Big Corked Boots's picture

No shit, sherlock.

Thu, 10/17/2013 - 15:07 | 4066175 ebworthen
ebworthen's picture

Yellen and QE4!

It's like the Queen Elizabeth 4, but really more like the Titanic!

When the Russians and Chinese agree to move the Dollar out of reserve currency status QE"X" won't matter.

Thu, 10/17/2013 - 15:07 | 4066176 Goggles Pisano
Goggles Pisano's picture


Thu, 10/17/2013 - 15:08 | 4066181 krispkritter
krispkritter's picture

Slowly? Like this?

Mythbusters Rocket Car Pancake 

All they needed to do was paint the car Red, White, and Blue...

Thu, 10/17/2013 - 15:09 | 4066184 One And Only
One And Only's picture

Buh buh Buh our dear leader was born of immaculate conception. How could he be sending us to the bottom of the world's toilet ball? Unpossible.

Thu, 10/17/2013 - 15:09 | 4066189 stant
stant's picture

wow------ ya think?

Thu, 10/17/2013 - 15:10 | 4066195 Bay of Pigs
Bay of Pigs's picture

It's a good thing crazy "bloggers" like Tyler Durden of Zero Hedge pick these stories up from the BlowHorn [CNBC].

(since nobody watches them anymore, we would have missed it).

Thu, 10/17/2013 - 15:19 | 4066235 fonzannoon
fonzannoon's picture

So U.S credibility is eroding, and based on that it is prudent to buys stocks and bonds.

Thanks Jeff 

(does anyone know what Jeff sells btw?)

Thu, 10/17/2013 - 15:27 | 4066264 Bay of Pigs
Bay of Pigs's picture

I saw that too fonz. Moar bawnds?


Thu, 10/17/2013 - 15:14 | 4066207 ebworthen
ebworthen's picture

Meanwhile, as IBM furloughs employees and cuts retirees off from promised insurance benefits, anyone holding the stock is -7% today.

Yup, things are fine, this economy is recovering, Europe is improving, China's growing middle class will save the consumptive world, the U.S. is solvent, Leprechaun friend is demanding my attention.

Thu, 10/17/2013 - 15:15 | 4066211 falak pema
falak pema's picture

Since this crisis and thanks to the Tea PArty the "slowly" has become fast track.

Thu, 10/17/2013 - 15:21 | 4066243 Bay of Pigs
Bay of Pigs's picture

You mean the "scapegoats" right? Thats all Obama and Boner wanted to do with this manufactured crisis. Paint anyone who is fiscally responsible as "evil and wrong" and "trying to shut the US gov't".

Give it a rest retard. You're a fuckan idiot falak.

Thu, 10/17/2013 - 15:56 | 4066382 falak pema
falak pema's picture

I belong to no cabal. Get that into your head.

The Tea Party is totally discredited. If you guys feel you have a message to sell to the nation, based on your values then you are doing it the WRONG WAY.

Thats the lesson. The first thing to understand is the world is what it is. Its Pax Americana...and like all juggernauts it has a momentum that none can turn around on a six pence! 

You want to change that? Well its not by doing what these retards have done over the last few months. 

Grow up! Look at the political process as IT IS. Change comes over a period and it requires patience. It requires the adherence of the PEOPLE.

Not vigilante stuff! That's the road to Dictatorship. If you think the other side is on that road, then you have to build your power base from bottom up. Not from low leveraged ideological plays that are totally counter productive. 

Win the people then win the Congress; not the other way. And if you can't win the people you don't deserve to be in power in a nominal democracy. 

Thu, 10/17/2013 - 16:07 | 4066432 Bay of Pigs
Bay of Pigs's picture

Youre the one that brought the Tea Party up, not me. What you said above made no fucking sense whatsoever. They have zero clout in CONgress. As in none.

Get THAT through your thick head and try to connect some dots why they were blamed in the first place.

Thu, 10/17/2013 - 16:15 | 4066455 falak pema
falak pema's picture

THe WHOLE WORLD is saying the TEA PArty overplayed their hand and tried to run when they couldn't even learn to WALK in terms of political clout. By so doing, by being ideologically obtuse  they instilled this incredible fire sale of the GOP.

Do you even read what the world says? 

I'm not questioning the sincerity of the values of RP and consorts; I'm questioning their ability to weigh on the political process in a democracy; bad as it is. FAIL.

Thu, 10/17/2013 - 16:28 | 4066499 Bay of Pigs
Bay of Pigs's picture

Yeah, keep drinking the MSM Kool Aid falak. Boehner, Cantor, McConnell, etc...are NOT part of the Tea Party. You FAIL at Poli-Sci 101 and common sense.

As the poster said below, you really are a special kind of stupid.

Thu, 10/17/2013 - 17:13 | 4066663 falak pema
falak pema's picture

Boehner played along with the TP and tried to muscle it out and then backed off. He played the TP hand, he fronted it, until he folded as the others were not behind him. It was evident from day one the TP clique didn't have the fire power. 

He will now wear that hat. Its not the man, the fall guy, its the strategy of Slugging it out when you don't have the staying power and all its done is to hurt american prestige; maybe thats what the TP wants.


Thu, 10/17/2013 - 15:52 | 4066366 aardvarkk
aardvarkk's picture

It takes a special kind of stupid to assign blame for this Charlie Foxtrot situation on the one group who really has very little power while absolving everyone else.  A SPECIAL kind of really, really stupid.

Thu, 10/17/2013 - 16:09 | 4066439 NOTaREALmerican
NOTaREALmerican's picture

Re:  situation on the one group who really has very little power while absolving everyone else.

You mean like OldFart white-trash running around in  socialist motorscooters blaming "those people" for taking the 2 TRILLION dollars worth of loot that it distributed to the politically connected each year.

Yeah,  it IS pretty stupid. 

Thu, 10/17/2013 - 15:19 | 4066232 Smiley
Smiley's picture

What do you mean 'Slowly?'


Why in the world would anybody invest money in a country full of idiots who can't stick to a budget and in fact, get offended at even considering the prospect?

Thu, 10/17/2013 - 15:55 | 4066379 aardvarkk
aardvarkk's picture

You hit the point that just mystifies me.  Not only do we not have a single leader (including the tea party) advocating for a BALANCED budget (they're all about "deficit 'reduction'"), but they and seemingly every yahoo in the country jumps down the throat of ANYBODY who suggests perhaps we should live within our means.  Because when you think people and countries should live within your means, I guess you're racist or something.

Thu, 10/17/2013 - 16:06 | 4066426 NOTaREALmerican
NOTaREALmerican's picture

Re:  the throat of ANYBODY who suggests perhaps we should live within our means

How many really smart-n-savvy people do you know living the good life off of Big-Ag, Big-MIC, Big-Road, Big-Water, Big-Airport, Big-Energy, Big-Ed, Big-House, Big-Fin, Big-OldFart, Big-OldFartHealthcare, Big-AntiDrug, & Big-PoliceState?

How many smart-n-savvy people are dumb enough to want their own crony-capitalist scam to end?

The country's been a crony-capitalist scam for 60+ years.   It's great if you're living off of other people's money.   And EVERYBODY loves living off of other people's money.   It's the best kinda money there is.

Thu, 10/17/2013 - 15:22 | 4066250 MFLTucson
MFLTucson's picture

Thank you to Barack Obama and the morons who would vote this man into office!  

Thu, 10/17/2013 - 15:25 | 4066257 ziggy59
ziggy59's picture

Lol...Long-term reputation of US markets appears intact despite high-stakes budget fight

Appearances are obviously disceptive...

Thu, 10/17/2013 - 15:47 | 4066338 sbenard
sbenard's picture

I disagree! America's credibility is NOT eroding SLOWLY. It's eroding RAPIDLY!

Thu, 10/17/2013 - 15:47 | 4066339 Atomizer
Atomizer's picture

The Central Planners policies are reaching critical failure mode Globally. It’s a three step process.


  • A massive fiscal stimulus.
  • More aggressive monetary easing.
  • Structural reforms to boost competitiveness.

 Recently, the IMF ran another effort to rejuvenate the theory of Abenomics. When watching link below, remember that 2% is the magic number to become a hero.  Enjoy

Now that you understand. Listen to what you hear the sock puppets telling you. All will make sense going onward.

Thu, 10/17/2013 - 15:50 | 4066360 kaiten
kaiten's picture

Gundlach: "America´s credibility is slowly eroding"

Slowly? Optimist.

Thu, 10/17/2013 - 15:55 | 4066381 Jethro
Jethro's picture

No kidding! Obama is Cap'n Kirk, and BS Bernanke is Scotty, this credibility death spiral is at warp 9.

Thu, 10/17/2013 - 15:56 | 4066383 foxenburg
foxenburg's picture

What does he mean "credibility is eroding in the wrong direction"? cf eroding in the right direction??

Thu, 10/17/2013 - 15:59 | 4066385 SheepDog-One
SheepDog-One's picture

Correction- Americas credibility is a total joke, just that people like Gundlach are just now slowly catching onto that fact.

Thu, 10/17/2013 - 16:02 | 4066402 NOTaREALmerican
NOTaREALmerican's picture

This guy is obviously a defeatist anti-American who hates our freedom, and the troops.

Thu, 10/17/2013 - 16:28 | 4066498 Atomizer
Atomizer's picture

Quite the opposite my friend. He is now understanding what he knew all along, but denied the truth.


Just take JPM/Chase story yesterday. Perhaps this will help you understand what we see. Hope this simple knowledge will open doors to understand and generate solutions.

Money Confiscation Legal?

Thu, 10/17/2013 - 16:05 | 4066417 ToNYC
ToNYC's picture

Collapse Dynamics predicts ending by Ice rather than Fire.

Thu, 10/17/2013 - 16:12 | 4066454 Widowmaker
Widowmaker's picture

Because ejaculation always happens "slowly."

Gundlach is a buffoon.  There simply ain't no credibility.

Thu, 10/17/2013 - 16:30 | 4066507 dcohen
dcohen's picture

America is like an alien nation, not belonging to the world, it acts strange, talks strange and thinks strange. 

Thu, 10/17/2013 - 16:34 | 4066519 Fundies
Fundies's picture


Thu, 10/17/2013 - 17:00 | 4066626 Arkadaba
Arkadaba's picture


Thu, 10/17/2013 - 17:31 | 4066720 nakki
nakki's picture

nice call on google! when central banks started "printing" money whtever cred we had was long long gone.

Thu, 10/17/2013 - 18:33 | 4066888 thewayitis
thewayitis's picture


 Duh ....Credibility? Its been going downhill for years ....We're just PICKING up MORE speed.  Dimwitt

Thu, 10/17/2013 - 19:45 | 4067104 blindman
blindman's picture

nation al cia da is being murdered to make room
in the cortex for global, inter national, composed of
decayed meat and brains of decaying national matter'
in space and time , structured and dysfunctional
hand off.
people and persons having been
previously defamed and become dependent to such
delusional and macabre domain, celebrity trap
on tarp give away.
credibility is just an adverb called a synonym\
in place of a noun. clean slate filled with
more bullshit for the unsuspecting innocent many!
somewhere someone resorted to the threat of
insubordination and someone laughed and laughed,
another died and another went into the cage.
I Drink Your Milkshake! - There Will Be Blood (7/8) Movie CLIP (2007)
anyway poems *t

Thu, 10/17/2013 - 20:10 | 4067206 BullyBearish
BullyBearish's picture

We'll be gellin with Yellen...

Thu, 10/17/2013 - 20:23 | 4067257 polo007
polo007's picture

According to Deutsche Bank:

October 8, 2013

Bretton Woods III and the Global Savings Glut


History suggests that periods of global economic expansion are characterized by symbiotic imbalances rather than balanced arrangements that satisfy theoretical ideals. Therefore, it is important to understand the factors that drive the imbalances in each period as well as the resulting distortions. In our view, demographics will have a significant impact on the future trajectory of the world economy. In this report we specifically focus on the implications on savings and current accounts.

Population trends imply that we are entering a phase where rapid aging will cause many countries to generate persistent current account surpluses. This raises the question – who will generate the world’s deficits?

World demographics is not neatly spaced out such that some countries generate surplus savings exactly when others need to fund deficits. Moreover, there are many factors that may prevent surplus countries from funding deficit countries. Thus, we have a situation where countries like India, Brazil and Indonesia may attempt to tame their deficits before old countries like Japan and Germany enter their dissaving phase. The resulting savings glut could be further exacerbated by a likely increase in China’s current account surplus.

Thus, the emerging international economic system, dubbed by us as Bretton Woods III, will yet again depend on the United States to act as the demand source of last resort. Meanwhile, demographics will hold down the real cost of international capital whether or not the US decides to absorb part of it. In turn, the ability of world’s financial system to allocate excess savings will be tested again. Young emerging markets with the ability to sensibly deploy cheap capital could benefit disproportionately from this environment.

Thu, 10/17/2013 - 22:41 | 4067650 Wilcox1
Wilcox1's picture

So, Is the Market moving past the Fed?

Fri, 10/18/2013 - 07:58 | 4068164 Youri Carma
Youri Carma's picture


Fri, 10/18/2013 - 10:08 | 4068520 Youri Carma
Youri Carma's picture

- They must continue the Zero Interest Rate Policy (ZIRP) forever and the Quantitative Easing (QE) to infinity.

- The USFed must accelerate the QE bond monetization program, not reduce it.

- The bigger conclusion is that the USGovt debt default is within view, no longer over the horizon.

- The nations which actively depart the USDollar Sphere will survive, the others to fall into the De-industrialized Third World. Many are the forces within the inner circle and along the periphery.

- The Gold Trade Standard, enforced largely by China & Russia, supplied by the BRICS Bank which will manage the conversion of USTBonds to Gold bullion, will manifest the Paradigm Shift.


Money velocity remains crippling low, at historic lows. The fast decline in Money Velocity is the most convincing proof of the failure of monetary policy. The Money Velocity is at historic lows, a point of extreme embarrassment to USFed Chairman Bernanke, who is on the way out with failure on his resume. Be sure to know that fast reducing money velocity is the most reliable signal of deep recession and economic danger.


QE does not provide stimulus, but rather capital destruction. The amplified monetary expansion has aided banks and redeemed bonds, but with no tangible benefit to the useconomy. Many are the channels for money flow, but most are blocked. As capital is killed or retired from the USFed monetary policy, the money velocity declines. It is proof of capital destruction in its wake. They preside over failure with a franchise model that causes great capital destruction in the climax phase. Rather than stimulus, the monetary policy produces killed and retired capital. The truth is the exact opposite. No stimulus is seen, when in fact the QE bond monetization will continue to kill capital and destroy business. Military spending for a profound deficit effect that harms twice with capital destruction in true nazi style. However, almost no economists comprehend the capital destruction and severely harmful effect from the USFed policy.


The debts are covered by hyper monetary inflation. The nation seems to completely accept the notion of the USFed monetary policy being a radical stimulus that runs the risk of promoting extreme price inflation. The price inflation effects are all over the board, with material costs rising, service costs rising, but liquidation sales throughout the field of view in a suppressive cross current effect.


A grand game of shuffling gold bars has begun, actually accelerated in a final phase. The big bullion banks wish to obscure that they are almost bone dry of gold in inventory. The COMEX registered gold continues to plummet, down to 665k oz gold in a recent snapshot. The present level of 0.665 million ounces marked on September 10th means a 77 to 78% decline had occurred this year. They are being drained and lied to, holding a fistfull of gold certificates that are in the process of being forcibly redeemed at cash. Further investigation reveals JPMorguen taking gold from Scotia Mocatta under certain hidden threat, as well as from HSBC and other big banks. Ramps are busy moving gold bullion around in trucks and tunnels. It is curious why Scotia Mocatta played this game of harikari. They cut a deal in Satan’s service.


A global USDollar rejection is in full swing. The foreign dumping of USTreasury Bonds actually accelerated this past summer, amidst the Taper Talk trial balloon offered by the hapless desperate Bernanke Fed. Foreigners sold more US$-based securities in June than after the Lehman Brothers bankruptcy. The USFed must lap up what is dumped. Next on the global stage will be the USFed serving as the processing plant for the USTBonds returned to sender from a vast stream of foreign entities. Big pressure is on primary dealers, which the USFed must relieve. The Taper Talk will reverse into an acceleration of official bond purchases. In June and July, the Jackass indicated that the USFed would eventually be forced to buy up all the foreign dumping of USTreasury Bonds. It happened. The new threat is the seizure of the REPO market, the vast overnight credit window device.

The TIC Report is compelling. Paul Mylchreest added a great point regarding the tighter capital requirements imposed by Basel III Rules. He said, “Leverage ratio regulations might preclude banks using REPO’s to accommodate sudden influx of Treasury [being dumped by foreigners.] Maybe they will use the Exchange Stabilization Fund if BRICS start swapping USTreasurys for Gold as you suggest.” So the big US banks, and London banks too, might not be able to withstand the huge flood of USTBonds returned to the sender from foreign sources due to stricter rules on stretched capital.

FROM: Gold Resurrection from Financial Disaster, 17 October 2013, by Jim Willie (Golden Jackass)

Clear Huge Totem-Poles of FED’s Failing because despite years of QE:

- 10-Year Bond Prices Have Actually gone up – FAIL!

- Even FED’s own Core Inflation doesn’t reach 2% – FAIL!

- Extremely Low Money Velocity – FAIL!

- GDP Declining, growth forecasts constantly cut – FAIL!

Do NOT follow this link or you will be banned from the site!