Bond Fund Manager Expresses Skepticism Over Unemployment Data, Calling It 'Unbelievable'

Amid a growing list of major company layoffs in 2024, billionaire bond fund manager Jeffrey Gundlach, also known as the "Bond King," has expressed skepticism about certain unemployment data during an interview on "Making Money with Charles Payne."

Gundlach highlighted that 88% of states, including the District of Columbia, have reported rising unemployment over the last six months, which he finds hard to reconcile with the stable and low national unemployment rate. He questioned how national unemployment could remain steady if the majority of states are experiencing increases.

In contrast, the December jobs report indicated that the U.S. unemployment rate unexpectedly dropped to 3.7% after a series of monthly increases, attributed to a decrease in the jobless rate among teenagers. However, a recent report by Challenger, Gray & Christmas revealed a significant acceleration in job cuts by U.S. employers during 2023, with a 98% surge in layoffs compared to the previous year.

Gundlach emphasized his concerns about the data, citing negative leading economic indicators and a prolonged inverted yield curve. He drew parallels between current market conditions and the "inflation fight" of the late 1970s to early 1980s, expressing recession concerns.

The "Bond King" pointed out that states with declining unemployment rates, such as Texas, Pennsylvania, North Dakota, and Wyoming, might not be able to offset the increasing unemployment in states like Florida, Illinois, California, and New York.

Looking ahead to 2024, Gundlach predicted that Federal Reserve Chair Jerome Powell will likely cut rates.