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CEO of $150B investment fund expects upcoming weakening of USD and jump in Bitcoin price

Jeffrey Gundlach — the CEO and chief investment officer of DoubleLine Capital — shared an investment setup happening right now that has historically rewarded patient investors. Before this instance, it occurred just two other times in the past century. Gundlach said the US dollar "should weaken" in the near future — a core expectation that helps dictate some of his other forecasts. In a call unrelated to his US dollar forecast, Gundlach said bitcoin would climb as high as $15,000 in 2020. The prediction comes on the heels of his spot-on bitcoin forecast for 2019. Click here for more BI Prime stories.

It was hard to lose money in 2019. 

The S&P 500 returned 29%, emerging-market stocks gained 15%, oil increased 34%, gold swelled by 19%, and US bonds climbed 8.7% in aggregate.

Still, many experts say it's unlikely that investors will reap similarly broad-based returns across asset classes in 2020.

But Jeffrey Gundlach, the CEO and chief investment officer of the $140 billion investment firm DoubleLine Capital, sees opportunities on the horizon — and a simple theme ties them all together: a weaker US dollar.

"It seems like it's just about time for the dollar to weaken," he said on a recent webcast.

Gundlach is adamant that the US dollar will depreciate for three main reasons: foreigners starting to divest from the US, the Federal Reserve's continued insistence upon printing money, and a blown-out budget deficit.

Below is a chart depicting the relationship between the US dollar and current account and budget balance of the US. According to Gundlach, the dollar — with a lag — is historically highly correlated to the movement in the twin deficits (the brown line). This leads him to believe that a weaker US dollar (black line) is on the horizon.

Bloomberg, Doubleline

With the prospect of a weaker U...

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